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Posts Tagged ‘Enteprise Resource Planning software’

As ERP implementers, we’ve seen many of them: the signs that an ERP project is in jeopardy.  Or in some cases, we get called in after it’s happened, and are asked to help set things right.  In that sense, we’re in the same business as the folks at Panorama Consulting, who recently released a brief outline highlighting some of those very warning signs.  Their list was complete and good enough that we thought we share excerpts of it in our post today.  Here then is their Top 10 Warning Signs list:

 

  1. Unrealistic implementation project timeline, budget, and resources. Unrealistic expectations lead to bad decisions.  A strong dose of reality goes a long way.  This one’s more common that you think – and no one thinks it’s going to happen to them.
  2. Lack of involvement from your executive team. Exec involvement needs to go beyond approving budgets and timelines, and must include being involved in key decisions all along the way.
  3. Unclear business processes and requirements. Take time to complete this step clearly, in writing, with full team cooperation before you begin your implementation process.  The Business Process Analysis is the critical first step toward project success.
  4. Not enough time spent on business process reengineering. If you don’t refine and redefine your business processes, you’re just “paving the cow paths” as they say.  Or automating already inefficient processes that “bake in” those inefficiencies for the long run.
  5. Your organizational change management strategy consists solely of end user training. User training is important, but it’s only one component of what you’ll need to overcome resistance to new ways and new systems.  Change-impact plans and constant communication are required.
  6. Too little or too much dependency on outside ERP consultants. Don’t underestimate your need for outside help, but don’t “outsource” your whole implementation either.  Remember, it’s your system, and you need to own it.  Find the balance that leverages outside help while allowing your team to take project ownership for the long haul.  It’s hard work.
  7. Ill-defined project governance and controls. Make sure you have clearly assigned approval processes in place for changes and change orders.  Scope changes, customization requests and unexpected challenges need to be met with an intelligent process that vets each change, if you want to keep your project within scope, budget and timeline.
  8. No business case or benefits realization plan. You can’t improve what you don’t measure, so be sure to have benchmarks, goals and KPIs (key performance indicators) defined and thought through before you begin to implement.  As Panorama says, your ERP investment should be “a tool to manage and optimize potential business benefits during and after implementation.”
  9. The project is managed like an IT project. The only truly successful projects, as benchmarked by several of the criteria above, are those that approach ERP as a strategic business effort.  While ERP involves technology, in the end, it’s about the business, and not the technology.
  10. You don’t have a contingency budget. Most projects don’t go exactly as planned, and you don’t want to “paint yourself into a corner,” as Panorama notes.  Plan, budget-wise, for the unexpected, so you can finish up your project satisfied that you completed your goals.  They recommend 15% to 20% of expected project cost as a contingency.  A word to the wise.

We agree with Panorama’s assessment as shared today, and encourage anyone to match up their own ERP project goals and parameters with those listed above.  Thinking about them will be some of the best time you’ll spend in your entire project.

 

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Part 1 in a series…

It’s a bit ironic: Nearing 100 blog posts, I’ve rarely if ever written about the very thing that we here at PSSI do for a living.  Arguably, it’s our one area of true expertise, and I’ve been strangely silent on the topic for the most part. 

Perhaps it’s time to rethink that.

Simply put, we do ERP.  That’s Enterprise Resource Planning, a fancy moniker for the software that keeps businesses running.  Broadly speaking, we’re talking here about areas like accounting, inventory control, manufacturing and shop floor control, managing throughput in the warehouse or on the shop floor, as well as other critical business areas including customer relationship management (CRM, another of those multi-syllabic, three word monikers) and web store development (or ecommerce, that is, selling what you make through new channels like the Internet).

We think of it as software that matters.

In past posts, I’ve touched on some of these elements.  We’ve talked about CRM here in a multi-part post, and we’ve talked about WMS (there’s another one – warehouse management systems) here and here.

But let’s step back and look at the bigger picture: What is this stuff, and why is it so mission critical to any company that wants to grow, prosper, or heck, these days, even survive?  What good comes from it?  Who (and what) is involved?  What are the costs, and what are the benefits received as a result of that investment?

We’ll cover these and other topics in this new series of articles titled Software That Matters.

At its core, ERP software is, above all else, a strategic investment.  It’s an investment of your firm’s most precious resources — cash and people’s time — in what can be described as a long-term business improvement strategy aimed at substantially, even dramatically, improving your return on that investment (your ROI) in the years following a successful deployment.  ERP is front and center in business to improving your operational flow, reducing expenses, and continuously improving your processes.  And, it’s the platform for business growth.

We’ll take a deeper look into ERP in the articles that follow, and even look at a few success stories along the way.

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