Implementing an ERP system requires first and foremost executive level commitment from an organization. Under the majority of circumstances, it requires the type of planning and consulting that can only be given by an organization who posses people who are versed in these types of implementations. While it may seem reasonable for an in house IT staff to head the project, it is widely advised that ERP implementation consultants be used, due to the fact that consultants are usually more cost effective and are specifically trained in implementing these types of systems.

In most cases, an ERP implementation will take 3 months to 1 year or more, but it is worth every dollar when you start seeing the results. The increase in productivity, the savings in data entry and double work due to lack of integration, the speeding up of the sales process and customer service, and many other benefits, make the decision of going to a real ERP solution virtually obvious.

Implementing an ERP system requires a new way of thinking about the software and the business, therefore, there are significant changes regarding work practices. One of the most important factors when implementing an ERP system is company wide adoption. Executive level commitment, as mentioned before, is key, but success is better achieved when all of the company’s key people are behind it. By making sure that everyone is on board, the company will implement the system faster, thereby gaining the desired effects of ERP earlier, rather than later.

Usually organizations use ERP vendors or consulting companies to implement their customized ERP system. There are three types of professional services that are provided when implementing an ERP system. They are Consulting, Customization and Support.

Consulting Services - Usually consulting services are responsible for the initial stages of ERP implementation. They help an organization go live with their new system with product training, personalization and installation, workflow definition and deployment, and project management. The value of the consultant is in managing the transition from old to new system without creating disruption for the business, while at the same time generating value for the client from the new investment in ERP as quickly as possible.

Customization Services - Customization services work by extending the use of the new ERP system or changing its use by creating customized interfaces and/or underlying application code. While ERP systems are made for many core routines, there are still some needs that need to be built or customized for an organization.

Support Services - Support services include both support and maintenance of ERP systems after implementation. The following activities fall under the category of support services: Managing and Installing new software releases; educating new staff members at the client; questions and answers on procedural changes; and, trouble shooting data and program issues.

Advantages of ERP Systems - There are many advantages of implementing an EPR system. Here are a few of them:

• A totally integrated system
• The ability to streamline different processes and workflows
• The ability to easily share data across various departments in an organization
• Improved efficiency and productivity levels
• Better tracking and forecasting
• Lower costs
• Improved customer service

Obstacles to Implementing ERP Systems - While advantages usually outweigh obstacles for most organizations implementing an ERP system, here are some of the most common experienced:

• Customization in some situations is limited.
• The need to reengineer business processes in order to be more efficient may be met with resistance by users.
• Local technical support can be an issue; it is a good practice to make sure you will have good and quick technical support after your ERP solution is implemented.

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That said, many obstacles can be prevented if the adequate investment is made in the right implementation partner.

How to avoid the “Implementation Nightmare”

We are sure all people reading this have experienced or know a friend who has experienced what we call the “Implementation Nightmare”. What does that mean?

A company could not keep running the business with the current system, so they hired a Software Reseller. They spent serious money on the new project, the implementation was a disaster, the situation aggravating, and they ended up coming back to the old system”.

If you are among the ones that went through this kind of nightmare, first you have to understand that:

• You just came back to the same troubled situation you were before; your business is in a straightjacket.
  
  
• Your business MUST grow, that’s it! If you sell this year less than you sold last year, you are going backwards, but if you sell you this year about the same you sold last year you are ALSO going backwards. Your business HAS to grow in order to survive.
  
  
• The fact that you lost tens of thousands of dollars on a bad implementation may have you traumatized, but this is history. The worst thing you can do is just lament and not try a solution for your business.
  
  
• You HAVE to do something to make your business grow, and you already realized that your software will NOT support that growth. Your company is not a mom-and-pop business anymore.

Alright, so if you were able to get over the trauma, or if you are still lucky enough and never went through this situation, but you recognized that you MUST do something, how do you avoid being another victim of a bad and expensive implementation?

• Diagnose your software installation, but don’t do it on your own. We know that you know your business better than anybody else. You know most of the issues your company faces today due to limitations in the current software installation. However, professional advice will not only identify the problems you already know, it will also open your mind to new solutions you may not be aware of.
  
  
• Diagnose your hardware installation, but again, seek expert advice. For example, you may figure out that a Business-to-Business E-commerce module will allow select customers to place orders by themselves and save you many thousands of dollars in the sales order taking process, but are your network ready for that? Do you have the proper security to protect your business data, or to ensure that your customers will have fast and secure access to your system?
  
  
• Be prepared for the BNA. The Business Needs Analysis is as important as the software itself. An experienced consultant usually knows how to ask the right questions, but he will never know your business as well as you do, so do your homework and ask for a day or two before meeting with the consultant. Write a list of requirements and special needs that your business may have. If possible, e-mail the list to the consultant before meeting. That will make the BNA much more productive for both parts.
  
  
• Ask for references – reliable consulting companies should be willing to give you references. They do this only when they feel you are serious about doing business, and after asking for their customers’ permission. They respect their customers’ privacy, and they will respect your privacy as well, after you become a customer.
  
  
• Be prepared to pull up the sleeves. One common problem when implementing a new system is that some companies do not prepare themselves, and they end up placing all of the implementation burdens on the consultant. An ERP implementation takes planning, commitment, flexibility, acceptance to change, patience, and perseverance. You are changing the culture, the flow of information, business practices and functions, etc. Again, an experienced consultant can manage the change and make the process a much smoother, but the commitment of the company’s management and staff is key to the success of an implementation.