Mumbai University > Mechanical Engineering > Sem 8 > Industrial Engineering And Management

Marks: 10M

Year: Dec 2015, May 2015

Stages of ERP implementation

1. Project Establishment

   Project Establishment will comprise of the following activities:

   • Mobilization.
   • Project teams formation
   • Project plan detailing and fine tuning

   For a successful implementation, several types of skills are required. To ensure that the requisite expertise are available to the project, different teams are formed, consisting of members from the organization and vendor.

   • Project board
   • Competence center team, mostly represented by IT personnel of the organization.
   • Key users team.
   • Consultants’ team.
   • Project Implementation Committee.

   Entry Criteria

   • Vendor Project Team on site.
   • Organizations implementation team tentatively identified.

   Deliverables

   • Project Administration Plan.
   • Project standards document.
   • Project board formation.
   • Project Implementation Committee formation.
   • Competency Centre Team formation.
   • Key Users Team formation.
   • Delivery and Installation of vanilla ERP Application.

2. Procedure Development

   In this phase, key users and competence center team map the existing functional processes with the functions available in the vanilla ERP application, in conjunction with the vendor team. The following activities will occur in an iterative manner.

   • Process mapping
   • Gap detection
   • Work-around identification
   • Organizational impact analysis

   Deliverables

   • Business Model through flow chart.
   • Customization Design Specification document for identified modifications.
   • Draft Procedure Manual
   • Acceptance Test Plan and Data

3. Application Software Customization

   This phase includes program development for all modules using the Customization Design Specification Document, unit testing and system testing of all modules. The individual programs will be unit tested, based on test plans developed by the vendor. This phase may be carried out at offshore.

   Next, the developed and unit tested application software will be system tested during this phase. The system testing will be based on the acceptance test plan and test data provided by the organization. Thereafter it will be installed on the Designated Computed System.

   Entry Criteria

   • Acceptance Test Plan and Test Data
   • Customization Design Specification Document for identified modifications

   Deliverables

   Customized unit and system tested application software.

4. Acceptance Testing

   The focus of user acceptance testing is to exhibit that the system works. From the user’s point of view, acceptance testing is the final quality control procedure to determine whether the software product is performing as expected.

   Entry Criteria

   Availability of customized unit and system tested application.

   Deliverables

   • Tested Application Software
   • Updated procedure manual

5. End User Training

   All identified end users will be trained in the specific functions they are required to work. The training will be conducted by vendor.

   Entry Criteria

   • Tested Application Software
   • Updated procedure manual

   Deliverables

   • End users trained as per training plan

6. Conference room trial

   This phase deals on the simulation of the actual business environment. The following activities will occur iteratively during this phase:

   • Identification and entry of representative data
   • Simulation of the business model
   • Business Model enhancement
   • Finalization of procedure manual

   As the team reviews the data model, the business model that is prepared in the Procedure Development stage may undergo some changes.

   Entry Criteria

   • Tested Application Software
   • Updated procedure manual

   Deliverables

   • Final Procedure Manual
   • Final Business Model

7. Data Loading

   This is the migration phase where data from existing manual/legacy operations are transferred to System’s database using interface programs or utilities available within the ERP package. The following activities will occur:

   • Data conversion & loading
   • Establishment of Access Rights and Passwords

   Entry Criteria

   • Final Procedure Manual.
   • Final Business Model

   Live trial

   Once the Final Business Model is ready and database is loaded, the system is ready to go live. This phase will allow users to work on the application software with real time data.

   Entry Criteria

   • Data Loading Completed
   • Trained End Users.

   Deliverables

   • Live Trial completed
   • Data entry completed

Challenges of ERP Implementation

• ERP implementations have a nasty reputation for being challenging.
• These challenges can lead to your ERP implementation project taking too much time and being over budget.
• The result can be you being left with an underperforming solution. Or, you avoiding implementation of an ERP at all costs.
• While the challenges are real, they shouldn’t stop you from implementing one.
• In this post, we’ll cover some of the challenges of ERP implementations. Knowing these ERP challenges upfront could mean the difference between a successful and a nightmare of an implementation experience.

How ERP Software Works???

• First, how does ERP software work? Understanding this complexity, we’ll set the stage for why implementation can be challenging.
• Enterprise Resource Planning (ERP) software has been around since the 1990s. It has evolved from material requirements planning to automating all back office functions.
• ERP software works by integrating separate systems together into a holistic source of information and resources.
• This allows managers to identify trends, optimize systems, streamline decision making based on measurable metrics. This can improve the bottom line of any organization that decides to take the plunge.
• Common ERPs you might be familiar with are SAP, Oracle, Microsoft GP, and NetSuite.
• An ERP system takes your separate, complex business process and streamlines them. This is no easy task.
• An ERP software implementation involves many resources in terms of your data, employees’ time, and money. With so many moving parts, you can see how an ERP implementation can quickly go wrong.
• But, being aware of these ERP challenges below can help you prepare for (and avoid) them during implementation.

ERP Integrations

• The first challenge with implementing ERP software is knowing what processes or systems should be integrated, and which ones shouldn’t.
• It is difficult to know where integrating systems in an organization can gain a competitive advantage and where it will hinder the organization’s workflow.
• Do you need to integrate your ERP with your eCommerce and your POS software? Or what about your accounting and CRM?
• This becomes even more complicated in a large organization where different business divisions view each other as competition, or good old fashioned office politics gets in the way.
• Decision makers often don’t know fully what the ERP system is capable of when they’re planning the system.
• Do your homework on all your ERP’s software capabilities upfront. Make sure you understand the value of each integration (and the cost).
• You be asking yourself questions like this: is integrating your CRM essential to running your business, or would it just be nice to have?

Setting ERP Software Implementation Goals

• Another challenge is setting well-designed measurable goals and objections for your ERP implementation.
• Without goals, your implementation is sure to be directionless. This can lead to even more challenges and frustration.
• These goals need to be defined at the outset of the project. You also need to put a process in place for adding to or changing these goals.
• Designate who your implementation team is at the beginning. Understand each team member’s goals and departmental needs by the end of the ERP implementation.
• Always work with your goals in sight, but understand that needs could change throughout the implementation process.
• Many projects, not just an ERP implementation, have failed because goals were not established.

Customization

• One of the most often misunderstood issues with most ERP systems is the belief that they typically require extensive customization.
• Often what a company is buying is not a packaged solution, but a framework with which to build a solution.
• When you don’t consider these two factors, decision makers are not equipped to ask the right questions. Like, what will your order workflows specifically look like?
• This ERP challenge can lead to projects being delayed and cost overruns.
• Understanding your ERP’s framework, and how it applies to your business will help you uncover the best way to build your ERP solution. Avoid delays because of capability confusion and going over budget.

Flexibility Challenges of ERP Software

• Another challenge of an ERP implementation is dealing with the flexibility of your chosen ERP software.
• An ERP system that is not flexible may force an adopter to change their business processes to fit the ERP system model.
• This requires a re-engineering of steps needed to complete business tasks and retraining of employees and business partners, sometimes even customers. As we all know, people inherently do not like change, and this will create resistance and delays for any organization (at least in the short term).