Implementing Your Manufacturing ERP System, Part 2
By Eric W. Jonassen, President, OLAV & Co., Inc.
The first of this two-part series discussed selecting an ERP system that's right for your manufacturing business, as well as enlisting company leadership and involving the right business process personnel in the project team. [Read Part 1]
ERP system failures, however, are due less to the software and more to its implementation and poor user adoption. Proper implementation is often more important to the ultimate return-on-investment than the system you select.
Your expected ROI won't be realized if your end users resist its adoption because they were left out of the process. Introducing the new system using vendor test data will further alienate them with unfamiliar data bearing no relation to their actual job requirements.
Using company data instead as initial testing data encourages early user acceptance and facilitates training for optimal results.
It's also important to include data migration processes – including data cleansing, standardization, and consolidation – early in the implementation so only high quality data is migrated to your new system.
An early start on training senior end user personnel is facilitated by their involvement in identifying their priority data needs and by employing your own company data throughout the implementation process, increasing engagement, and adoption of the new system.
Balance Technology and Human Resources
Successful ERP implementations employ a balanced approach to assessing data requirements that includes key employees essential to a successful transition to more data-driven operations.
Our several decades experience confirms the human elements in data migrations – team effort, senior management leadership, recruiting the right personnel to participate, effective end-user training - usually prove more crucial than the technical.
Both are needed, but how you lead, staff, and communicate your ERP implementation will determine its ultimate success in achieving your strategic business objectives.
Enlist Outside Expertise
Many companies defer undertaking a complex implementation process despite recognizing the strategic and competitive benefits of a robust ERP system due to a lack of understanding and/or internal resources.
Which is why outside expertise is often needed to prevent a poorly planned and inadequately staffed vendor selection and implementation process. This can avoid misalignments between the system selected and your highest priority functional requirements.
This misalignment can lead to unrealistic expectations and system over-customization in order to compensate for the system's functional shortcomings. That's expensive to maintain as future upgrades are required. Choosing the correct outside expertise should lead to a shorter implementation time, lower total cost, higher quality results, and minimal to zero post-production issues.
Carefully Plan and Manage Your ERP Project
Post-implementation business disruption can be minimized with adequate training that communicates expected changes to end users, resulting in improved adoption rates.
Selecting a system with relevant out-of-box functionality minimizes customizations, while implementation best practices produce the shortest payback period. Capturing R&D tax credits for eligible payroll and consulting implementation costs can further enhance ROI.
The opportunity to upgrade business processes across an organization with a carefully planned ERP implementation is real and substantial. But it will only be realized with in-depth planning and sound project management that's essential for success.