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Posts Tagged ‘Digital transformation’

At a recent “Digital Enterprise Boot Camp” in Toronto, a group of leading IT executives and project managers discussed their experiences with recent ERP implementations and digital transformations.  Some of the key takeaways included…

For starters, there’s budget.  ERP implementations are large and costly, and one takeaway was that you don’t have to buy every module.  Focus those capital expenditures on the key project areas and the fewest number of early feasible users.  That way, you can see some progress, and pitfalls, along the way, and only invest more deeply later as project objectives begin to prove out.

Think next about best practices that are not necessarily technical in nature.  There are very real differences between projects that succeed and projects that fail, and they often have little to do with technology.  Best operational practices add real value to an ERP implementation, and smart CIOs consider those workflows and the people who will manage them before evening thinking about specific software.

Recognize the need for strong internal discipline.  This was especially valid for companies who had grown both organically and via acquisition, as different cultures and business styles lead to different processes and different outcomes.  You’re looking for standardized and consistent operations, mapped out before you implement process changes and software to match.

ERP isn’t just about software, it’s about the business transformation.  Most of the best projects are more about people and processes than software.  Software alone is not an effective blueprint for running your business.  Effective change management and project management are the real keys.

20 years is too long to be on the same legacy system.  Businesses change a lot over twenty years – these days more than ever, and twenty year-old ERP systems simply don’t keep up.  Business today is more aligned with technology than ever, and your systems need to keep up.  Organizational change management and careful planning of processes and the people involved are the first steps.

Internal biases are alive and well entrenched.  Most organizations have internal biases, recognized or not.  The main thing is to mitigate the biases by understanding the changes and flows truly required to align your business with its best profit-making capabilities today, and then explore the solutions – from change management and process flow through software and implementation services customized to our unique circumstances – that will truly match your needs.  After all, there’s a good chance those choices will have to work for you for the next twenty years.

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Any “digital transformation,” as the consultants at Panorama Consulting like to call things like ERP implementations, can seem daunting, a thing best put off ‘until tomorrow’ when, apparently, it will be… easier?  A recent article by Panorama makes a few points however that are worth noting, and that may get you off the starting line to your own internal project efforts and transformation.  We’ll meld their comments and our experience into today’s post.

For starters they point out, think about your ERP effort at a grass roots level.  You can start simply enough by having a few of your own people map out their current business processes, while thinking about the potential improvements they might want to see in a future state.  We always start our clients’ ERP projects with just such an effort.  Clients are usually too busy to do it for themselves, or perhaps too close to the subject to properly critique it, or lacking in the higher level business analysis skills that can help shape the best outcomes.  But at the very least, you can get your team thinking about how you do things today, and how you could better do them tomorrow, with less overlap and redundancy, and better information sharing and collaboration.

As you gather and review your grass roots analysis results, begin thinking about your overarching project goals.  Instead of starting with no sense of direction, think about the long-term goals business goals that underlie your IT, ERP or digital transformation project.  Be sure everyone understands the same goals, and how each of their individual parts in the process will contribute in the end to a more profitable, focused and leaner company.  Be careful not to get too distracted by the technology, and keep your purpose business-focused: that’s how you’ll succeed with customers and grow your own business.

Defining your business processes and requirements is the logical outcome of the actions and discussion we just noted.  It’s getting your ducks in a row.  It can take some time and outside help may be required (to learn what works and what doesn’t, best practices, etc.).  When you are ready to commence your actual ERP initiative, you’ll be equipped with the necessary data, thinking and step-outlines necessary to give your project its full forward momentum.

If you do all the above, you’ll be well prepared for the final step of hiring your outside consultant or reseller or implementer.  The process will go quicker and more smoothly if you’ve already given serious consideration to your business goals, your processes and workflows, and to your newly imagined future state.  It will help you more quickly and accurately match up process needs with software flows (and vice-versa), and save you time and money getting to the point where you’re ready to actually install and implement.

If it all sounds easy, well then, just remember that all along, your employees still have their regular jobs to do!  Be realistic in your expectations, fair in your judgments and remain focused on the planned business outcomes.  If you orient your resources consistently toward giving your people the tools they need and staying focused on the project’s business goals, you’ll fall into the small but highly desirable category of those who actually succeeded in their ERP implementations.

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digital-transformA recent post by our friends at Panorama suggests there are some myths about “digital transformation” – the process of transforming a company into a 21st century digital enterprise worthy of a quick recap today.  They make 4 points of distinction that companies should heed in the process of their continuous improvement and digital initiatives.

  1. Myth: digital transformation is the same thing as an ERP implementation. Their first point is that digital transformation is not ERP – at least, not ERP alone.  They do not assume a single off-the-shelf ERP solution.  Rather, they are open to best-of-breed, or sometimes hybrid, solutions.  Rarely is one company’s base ERP offering sufficient to serve the complete needs of a company.  We ourselves have found that with any of the variety of ERP solutions we’ve sold over the years, it’s still necessary and useful to utilize that software’s companion, third-party options to extend the reach and capabilities of the core system into areas often better handled by vertical subject matter experts.  Moreover, notes Panorama, ERP solutions are often about incremental improvements.  A digital transformation often requires “a more revolutionary approach to operational and organizational change.”
  1. Myth: your digital transformation software needs to be provided by one ERP vendor. As implied above, a digital transformation opens doors to all manner of new thoughts, processes, ideas and technologies.  So ERP may come from one source, your e-commerce from a second and your warehouse management from a third.  There’s no harm in that if all can be well-integrated.  And that requires people and process analysis, before anyone touches much software or hardware, we might add.
  2. Myth: digital transformations should be run by the IT department. Most enterprise software initiatives must be viewed first as a business project, and then as a “computer” or “IT” project.  We always remind prospective clients: ERP (and by extension, digital transformation, is first and foremost a strategic business investment.  Business and executive involvement here are more important than ever.
  3. Myth: digital transformations are best for every organization. Not always, Panorama points out.  Sometimes, incremental, slow change is best.  They note that… “The key is to identify what type of project you want this to be, and then ensure that you have alignment in how you allocated resources, focus and measures of success for the project.”

Whether yours is an ERP project, a true digital transformation, or something in between, begin with a clear definition of the what the project is, and the pace of change the organization believes it can support.  These will often dictate the steps that should – or should not – be taken after.

 

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