With ERP implementation, as with any other project, planning is everything. Companies that do not prepare sufficiently are putting the success of the project at risk – and that can be expensive. What you need instead is a plan: a detailed checklist that you work through step by step.
It is usually no problem for ERP veterans to create such a plan. They can draw on their own experience. But what do decision-makers facing their first ERP implementation do? The internet offers a lot of material on how to proceed, but this content is often superficial and incomplete. It is difficult to find a comprehensible (and above all complete) description of ERP implementation as an overall process. That’s why we’ve taken the time to describe the complete procedure in this blog post: The ERP implementation from A to Z.
Preparation and requirements analysis
Contrary to the expectations of many decision-makers, an ERP project does not start with huge specifications or complex drawings on a whiteboard. It starts with you sitting back and thinking carefully.
The first question you should ask yourself is: Do you have the necessary resources for an ERP project? Bear in mind that the ERP implementation will tie up some of your employees for several months. During this time, your project team will only be able to carry out its own day-to-day business to a limited extent. Can you cope with this loss of work? If not, it is better to extend the project over a longer period.
Once you have ensured that you can handle the ERP project, it’s time to analyze the requirements. First of all, think informally about what your ERP system should be able to do. There are two perspectives that you need to consider: the technical (which technologies do you need?) and the functional requirements analysis (which features does your ERP system need to have?). At this point, avoid the mistake of defining all the requirements yourself. Instead, take a tour of the company and get input from the departments. This is the only way to find out what your employees really need from the ERP system.
The specifications
The next step is to formally write down all previous considerations in your specifications. This document will later form the basis for the actual ERP selection. It not only contains your technical and functional requirements, but also:
- Information about the company and market environment
- an overview of your technical infrastructure
- the schedule of your ERP project
The specification sheet is a topic in itself, and we have already published numerous other blog posts about it. If you are having problems with your specifications, you will finduseful tips and tricks in thisarticle, for example. At this point, we would just like to give you one piece of advice: Do not underestimate the specification sheet! This document forms the cornerstone of the subsequent ERP implementation. If you skimp at this point, you will pay for it later – guaranteed.
From the longlist to the shortlist
With the requirements specification, you have created a solid foundation for your new ERP system. Now it’s time to select the right provider. However, the ERP market is large and complex. There are hundreds of ERP systems. You first need to narrow down the selection to a manageable list of possible ERP partners. We call such a list shortlist.
Before you compile your shortlist, you should first carry out a rough narrowing down. A simple internet search will suffice. Get an idea of the ERP systems available and eliminate those that are already out of the question. The requirements that you have written down in the specifications are a helpful criterion. For example, is there a missing feature that you have declared as a key requirement? You have already narrowed down your list even further.
The result of this pre-selection is your longlist – a list of ERP providers that are generally suitable. In the next step, you send your specifications to all providers on the longlist and ask for an initial assessment. The response you receive to this request forms your next selection criterion. Pay attention not only to content-related statements, but also to “soft factors”. For example, do you receive a standardized response or an individual evaluation of your request? Both can provide you with valuable information about the provider.
If you do not have enough information after this rough selection, you can arrange a personal meeting with the remaining providers. Ask for a brief presentation of the various ERP systems and take the opportunity to get to know the provider personally. This will help you to further filter your longlist until you have a document with all suitable ERP providers in your hands: Your shortlist.
ERP workshops and system selection
So now you have a list of potential ERP partners in front of you. Does that mean the ERP selection is over? Unfortunately, no. The providers on your shortlist are all basically suitable as ERP partners – but you still don’t know which of them is the best fit for you. This may sound petty, but the decision for an ERP system has long-term consequences. You should make sure that you really are making the right choice.
For this reason, most companies decide to get to know the providers on the shortlist better during one or two-day ERP workshops. These events allow the providers to introduce themselves and their ERP software and to respond in detail to the questions and requirements of the prospective customer (in this case, you).
As these presentations should be individually tailored to your needs, it goes without saying that the provider must prepare thoroughly. They need precise information about your company, your industry and your challenges. While the specifications are a good source of this information, nothing beats a face-to-face meeting at this point. That’s why we always recommend inviting all parties to a supplier briefing in advance. This is a preparatory meeting that allows the provider to find out more about your company and its context in a direct conversation. In our experience, such briefings always lead to better ERP workshops – and in turn make it easier for you to decide on the right system.
Once you have conducted a workshop with all the shortlisted providers, you only have to decide on one of them. There are pitfalls lurking here too. Many companies see costs as the primary decision criterion. But “soft factors” can also have a major impact. For example, if there are personal antipathies between your project team and the provider, you can already prepare yourself for conflicts. Make sure you keep an eye on all factors, not just the price.
The implementation
As soon as you have selected the right ERP provider and clarified the contractual details, the next phase of the ERP introduction begins: implementation. This involves technically implementing the ERP system and anchoring it in your processes. At the same time, your employees receive training on how to work with the ERP system.
First of all, however, another workshop is on the agenda, in which you and your ERP partner examine the requirements from the specifications together. The aim of this is to develop a common perspective and clear up any misunderstandings. The result of this workshop is the functional specification: a document that defines how the ERP provider intends to technically implement the specifications from your requirements specification. Some ERP managers make the mistake of simply waving the requirements specification through in order to speed up the project. However, this can have expensive consequences, because even with intensive consultation, different interpretations can never be ruled out. It is better to read the specifications carefully and check everything thoroughly.
As soon as the specifications have been drawn up, the ERP provider’s technical staff work with your IT department to set up the software on your premises and make any necessary adjustments.
Acceptance test and training
The technical implementation is followed by several migration tests and final acceptance. As the customer, you can now put the system through its paces. Do not be impatient at this point. Check every single function carefully – negligence can be expensive.
The training of your team takes place in parallel to the entire implementation process. These trainings are actually two different trainings: the basic training and the employee training. Both take place at different times. The basic training takes place at the beginning of the implementation. The ERP provider gives your key users an overview of the system and trains them in how to use the most important functions. The aim of all this is to make the key users fit for supporting the implementation and later training their colleagues.
Employee training, on the other hand, only takes place towards the end of implementation. As soon as the system is up and running, you get the rest of your employees on board. In contrast to basic training, however, this task is not performed by the ERP provider, but by your key users. This is therefore internal training. The idea behind this is to support the transfer of knowledge within the company and to anchor ERP knowledge in the company. In this way, you are no longer so dependent on your ERP partner.
Once you have also completed this step, the ERP implementation is complete. The system is up and running and your employees can use it. Your ERP solution is ready for use.
The complete ERP implementation process
Milestones for the ERP implementation
In addition to the phases already described, the definition of clear milestones is crucial for the success of the project. These serve as reference points for measuring progress and responding to potential challenges at an early stage. Important milestones can be
- Project initialization completed: The ERP project has been officially approved, the core team has been put together and the initial course has been set for successful implementation.
- Completion of the requirements analysis: All relevant business processes have been recorded and documented in detail – the basis for a customized system configuration has been created.
- System selection made: After careful evaluation, the decision for the suitable ERP system is made and the contract is signed.
- Completion of the implementation phase: The software has been successfully implemented, adapted to the company processes and is ready for the test phase.
- Implementation of the system test: All functions were thoroughly tested, potential errors were rectified and approval was given for live operation.
- Go-live: The ERP system goes live – a decisive step towards sustainably improving efficiency and transparency in the company.
Careful planning and monitoring of these milestones makes a significant contribution to the structured and successful implementation of ERP.
Additional tips for success
Finally, we would like to give you a few additional tips that can significantly support the success of your project. With these recommendations, you can ensure that both technical and organizational aspects harmonize perfectly with each other in a simple and efficient way. In this way, you will create a solid foundation for the smooth progress of the project.
- Gather the expectations of all parties involved from the outset in order to create a solid basis.
- Recognize potential stumbling blocks early on and plan appropriate measures.
- Organize the transfer of your data systematically to avoid delays.
- Clearly define who is responsible for which tasks so that everyone can make their contribution.
- Use automated processes to optimize the workflow and reduce errors
- Keep all team members up to date and encourage them to share information.
If you would like to delve even deeper into the process of an ERP implementation, you will find comprehensive insights and further practical details in our Whitepaper “The ERP implementation from A to Z”.
