ERP implementation – Strategic growth plan for your business

ERP, earlier considered as the software for only large enterprises, now is paving it’s way to the SMEs and is providing them with various options for simplifying their business.
The demand for ERP software among the Small and medium businesses is growing tremendously, specifically for the Cloud based ERP software, due to its simple and flexible ERP implementation.
ERP vendors are offering small and medium businesses everything they need, right from the simple business solutions to highly customizable software that can be integrated with multiple applications.
The main objective of the ERP implementation in any business (small, medium or large) is to centralize every data around the enterprise along with integrating every complex processes such as accounting, sales, purchase, marketing and much more at one place.
Enterprises have started noticing this power of ERP software and are eagerly waiting for implementing one to their business.
But the question here is:

Is your enterprise ready to execute the ERP implementation process?

According to survey conducted by Panorama,

  • 64% of the ERP projects go over budget.
  • 74% of the ERP projects take longer than expected.

Now, this situation arises due to many reasons such as not considering the type of ERP software to implement, inadequate knowledge of the vendor about the software and other factors included in the ERP implementation methodologies. 
You need to consider and analyze the entire process step by step, keeping in mind the various ERP implementation phases, before selecting the right ERP software.
In this article, you will learn to build a strategic growth plan that will help you in overcoming the Challenges occurring throughout the ERP implementation process.

Key points for you to take away:

  1. What is an ERP implementation strategy?
  2. Why is it necessary to build an ERP implementation strategy?
  3. Steps in ERP implementation life cycle for achieving better business performance
  4. Conclusion

So, without any further adieu, let’s explore the journey of ERP implementation and create structure for a successful business model.

What is an ERP implementation strategy?

It is all about setting up the software for your enterprise, shifting data into the software and configuring the entire system as per the business workflow.
For building a structured model for a smooth business ecosystem, it’s very important to have the right knowledge about the ERP software that you have chosen for implementation as well as the steps to proceed with the tasks on the way.
The strategy incurred while implementing the ERP software takes into account every minute details such as the state of the organization, management of workflow, goals, objectives and much more. 
So, your business fits perfectly into the system and you experience better performance.

Why is it necessary to build an ERP implementation strategy?

It doesn’t matter whether you are implementing the ERP software for the first time or just shifting to a new software, it’s always important to have a ERP implementation strategy.
As per the Statista reports,
The global market value of ERP is expected to reach about $97 billion by the year 2023.
The growing competition among the businesses is increasing with time, demand for better and dynamic performance. 
Because of such massive competition, many businesses in the market are implementing the ERP software without performing the necessary audit.
“The ERP implementation process starts way before you finalize the suitable ERP software for your business.”
As the right ERP software streamlines your entire business processes into one structured system, it is much important that you must know about the ERP implementation life cycle for a successful installation.

Steps in ERP implementation life cycle for achieving better business performance

Preparing for the ERP implementation prior to executing the process is the only way for structuring an efficient and dynamic business model.
Here are the 8 effective steps in ERP implementation life cycle:

  1. Identifying the type of ERP software 
  2. Deciding budget and time constraints 
  3. Finding an expert vendor
  4. Collaborating with the right team
  5. Analyzing risk management
  6. Analyzing change management
  7. Training the employees
  8. Going live

Identifying the type of ERP software for implementation

The most common mistake that is made by many businesses is not having enough knowledge on the type of ERP software to be implemented for their business.
For selecting the right ERP software for your business you need to know

  • What are the requirements of your business?

Do a complete research on the current requirements of your business, what change you are expecting if that requirement is met, and how it will be achieved.
This will also help you in exploring challenges associated with ERP implementation.

  • What is your business vision? 

Determine your business goals and objectives, and check if the software aligns with the strategies you created for it. 
Suppose you have a goal of increasing the business revenue by a certain percentage or filter out lowest performing employees.

  • What is the scope of the ERP solution?

Once you have determined the requirements, vision for your business, the next step is to check for the efficiency of the system to complete the project and the time it consumes in doing so.
This will help you in learning about the scope of the ERP solution and also in creating an outline of the implementation process. 

Deciding budget and time constraints

Deciding a budget and time constraints associated with the ERP implementation process is one of the main traits you need to consider while selecting the ERP software.
Determine the cost occurring at every ERP implementation phase such as deployment of the ERP, license agreement, infrastructure, integration, customization, training, on-going support and maintenance plan.
But in the case of cloud ERP softwares such as ChiefEx, you need to pay only a one-time fee and every ERP implementation process is taken care of.
Once you know the budget for the implementation, calculate the time it will be taking for the executing the entire process.

Finding an expert vendor

Many of the organizations implement the ERP softwares to their businesses without evaluating neither the knowledge of the vendors about the software as well as the ERP functionalities.
They realize their mistake, the hard way in the later part of the projects when they experience software’s lack of capability, functional restrictions, impact on the internal workflow and much more aspects.
Thus it’s always better to evaluate ERP vendor’s knowledge about the ERP software.
The signs your ERP vendor might not have the deep knowledge about the software:

  • Showcasing too much customizations
  • Focussed on selling the software capabilities rather than understanding your business needs
  • Cost of implementation is over budget
  • Providing inadequate consulting resources 
  • Not possessing the ERP implementation methodologies

Beware of the signs and opt for the right ERP vendor.

Collaborating with the right team

An effective robust ERP software requires an equally competent team. 
Collaborating with the right high-grade employees makes the outcome even more productive.
Set-up a structured workflow by categorizing your team as such:

  • Head team
  • Managing team 
  • Executive team. 

Assign a role to the team as per the position in the ERP implementation phase.
This will help you in achieving every business requirements, goals, objectives efficiently at a dynamic rate.

Analyzing risk management

Most of the ERP implementation failures occur due to improper risk analysis. 
Enterprises underestimate or ignore the density of risk and the impact it could cause to the overall workflow.
The prominent risk sectors are as such:

  • Insufficient or improper strategic planning
  • Lack of communication
  • Incompetent project team skills

Proper analysis of the risks, strong communication between teams, cultural readiness to face every obstacle will prevent such failures and streamline your business workflow.

Analyzing change management

Change management is extremely important when you are moving your data to a ERP software. 
It helps in smoothing the implementation process right from the start and until receiving the end outcome.
In ERP implementation life cycle, change management plays a vital role in structuring and streamlining the workflow in such a manner that it will provide optimal performance delivery.
Similar to risk management, communication is the key part of change management as well.
The 3 key components of change management:

  • Effective communication of change with the team
  • Executing stake-holder analysis
  • Providing en-to-end user training

Training the employees

Providing effective training to the employees on knowledge and skills makes them ready for executing the ERP technology successfully.
Training must be custom-designed for each phase of the ERP implementation of the organization.
This will help your team to know their roles better and thus providing an extra-push in executing the workflow.

Going live with the ERP software

After properly executing every step of the ERP implementation life cycle, it’s time to make the ERP software live for your business.
But the process doesn’t end here, even though the implementation has taken place successfully you need to monitor it for the results throughout to see a noticeable change.
So, here are the eight steps of ERP implementation life cycle that you need to follow for creating a better and performance based business workflow.
We hope these strategies will help you in implementing the right ERP software for your enterprise.
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