At a glance
Good preparation makes the ERP implementation quick, clear and manageable. When processes are in place and the data is correct, the project runs more smoothly and delivers real benefits sooner. A clear checklist ensures that decisions are made with confidence and the team remains focused.
The introduction of an ERP system brings many benefits as well as risks. There are numerous horror stories circulating on the Internet about failed projects: There is talk of excessive budgets, long delays and resistance within the workforce.
So it’s no wonder that many project managers are unsettled. What if such a disaster happens in your own company? We can reassure you at this point: With the right preparation, there is no need to panic. To ensure that everything runs smoothly for you too, we have compiled a checklist with the most important success factors for you. If you pay attention to the following points before the start of the project, nothing will stand in the way of a smooth ERP implementation.
1. document and optimize your processes
Information is exchanged in every company. Data such as delivery times, stock levels or project calculations are forwarded from one area to the next and processed there. The ERP system can only map this exchange if it is process-based and structured.
To ensure that the software works properly later on, you must first formally define your current processes. Every data exchange in your company should be fully documented and precisely regulated on the basis of processes. Without a description of the current status, it is not possible to fully map all processes in the system.
Important to know:
Documentation alone is not enough. In order for the system to ultimately develop its full potential, you must also analyze and revise your internal processes. After all, the real strength of an ERP solution lies in providing the best possible support for optimized processes.
To-dos:
- Look at the exchange of information in your company from a process perspective.
- Fully document your current processes.
- Put all internal processes to the test at an early stage.
- Allow sufficient time for process optimization.
In order for the system to ultimately develop its full potential, you also need to analyze and revise your internal processes.
2. create awareness for necessary changes
Some companies assume that the mere implementation of the ERP system will make processes more efficient. They see the tool as a kind of magic bullet that will magically solve all existing problems. This is, of course, a misconception. At the end of the day, an ERP solution is just a piece of software with features and functions that do not generate any added value on their own.
The system can only make a difference if the new solution is actively used. This means that your entire workforce must be prepared to work with the new software and break up old structures. To do this, you need to create the necessary awareness of the need for change throughout the company. The understanding for process adjustments and the willingness to change must be anchored in all areas.
Important to know:
There is a direct causal relationship between the dependencies within the value chain. If a business unit does not use the ERP solution, this has a direct impact on the upstream and downstream processes.
For example, if production still processes orders using physical route cards, it is not possible to react digitally to changes in scheduling. Someone has to print out the order data every morning and bring it to the factory floor. This represents a significant break in the digital information flow.
To-dos:
- Realize that the ERP system alone does not achieve efficiency.
- Find out how the individual divisions interact with each other.
- Integrate all departments into the solution.
- Explain the urgent need for change to every employee.
3. rely on professional change management
Every now and then, however, individual departments or employees vehemently cling to established procedures and block process adjustments. There are many reasons for this: some see no point in changing something that has been working for years. Or there are power struggles at play, in which the loss of one’s own indispensability would be fatal. Excessive demands can also express themselves in resistance.
Whatever the triggers may be, if your team resists the system, even the world’s best ERP solution will hardly bring you any efficiency gains. Change management is therefore one of the most important success factors of an ERP project. Companies that prepare themselves and their employees for the impending problems in advance are at an advantage.
Important to know:
Simply ignoring your colleagues’ fears and concerns is not a good idea. Instead, be transparent and communicate all developments openly to your workforce. Keep explaining the advantages of the new software and highlight the benefits that the solution will bring to their daily work.
To-dos:
- Get your employees on board at an early stage and actively involve them in the change process.
- Keep the workforce continuously informed about the progress of the project.
- Be open to feedback, ideas, doubts and concerns.
- Provide comprehensive training and learning materials.
Read more:
Large practical guide to change management
4. formulate precise project objectives
You should also define what you want to achieve at the very beginning. The more precisely you know your goals, the better you can work towards them.
The quality of the target definition plays a decisive role here: it must be clear, precise and unambiguous. Vague formulations such as “increase sales” are not a decision-making aid, but only cause confusion. Neither your project team nor your external partners can derive concrete requirements or specifications from this.
When formulating your goals, you can use the SMART system an acronym that defines five criteria for valuable goals. If, on the other hand, you have difficulties in setting basic goals, you should take a closer look at Greiner’s growth model. It can help you to better align your goals with your corporate strategy.
Important to know:
The functional scope of your ERP system should exactly match your objectives and cover the entire value creation process. If it doesn’t, the software is nothing more than a structured data storage or an organizational aid. However, the ERP solution should not be too bloated in the first step, as otherwise the costs and project duration will increase too much. Ideally, the system should have a modular structure. You can then upgrade the software with additional functions at any time if your requirements change in the future.
To-dos:
- Formulate your goals as specifically as possible.
- Avoid imprecise statements.
- Align the range of functions with your goals.
- Do not choose too many or too few features.
5. put together a strong project team
The success of the ERP implementation also depends to a large extent on the selection of the right project team. Ideally, it is made up of an experienced project manager and motivated key users. However, not all people are suitable for these positions.
A sure instinct is therefore required when putting together the team. Although the selection process is individual, you should pay particular attention to the following character traits:
- For the project management you are looking for someone who has the entire company in mind and not just their own department. In addition, the person leads with a gentle hand, but can also take action at the right moment.
- As a key user you should primarily select people with a high level of professional expertise and stamina. Foresight, empathy and a structured way of working are also excellent qualities.
Important to know:
Project management can only build a strong position if it has the backing of the management. backing of the management enjoys the support of the management. Only then can it make detailed decisions independently and confidently. This means that colleagues don’t even have the idea of going over the project management’s head and contacting the next instance directly. This in turn reduces micro-management at management level.
To-dos:
- Select a competent project manager and capable key users.
- Pay attention not only to professional skills, but also to personal skills.
- Give the project management sufficient trust and resources.
- Back up the project managers.
6. make sure you plan your resources sensibly
All too often, ERP implementation is declared to be a purely technical project. Once IT has introduced the software, everything will run smoothly – or so the theory goes. In reality, however, an ERP project always affects the entire company and requires internal personnel from different departments. This is because the ERP provider does not take on the implementation alone.
The Project management and key users, for example, accompany the entire implementation process. It goes without saying that they not only need special skills for this demanding task, but also a lot of time.
Important to know:
Many companies underestimate the internal time and costs involved. Bear in mind that coordinating and monitoring the implementation is almost a full-time job for the project manager. They usually invest up to 70% of their working time in implementation. So make sure that you and your employees have the necessary time resources.
To-dos:
- Estimate the internal effort realistically.
- Provide sufficient personnel.
- Free up some of the project participants from day-to-day business so that there is enough time for the ERP implementation.
- Consider external support if necessary.
7. evaluate your technological infrastructure
An ERP system places high demands on a company’s IT landscape. As a central platform, it integrates different business areas and processes large amounts of data in real time. Without a high-performance infrastructure , implementation can lead to system crashes, data loss or slow response times.
The existing hardware and software must therefore fully meet the requirements of the new ERP system and be compatible with it. An early and thorough assessment can minimize risks and ensure smooth integration.
Important to know:
An inadequate infrastructure can not only impair the performance of the ERP system, but also lead to high follow-up costs. Be prepared for necessary upgrades or delays in the course of the project.
To-dos:
- Carry out an inventory of your IT landscape.
- Take a close look at the system requirements of the ERP system.
- Examine the compatibility and interfaces of the individual solutions.
- Check whether you need additional hardware and software or new developments.
8. ensure clean master data
Company data is the lifeblood of an ERP system. It forms the basis for correct processes, analyses and documentation. If your data is incomplete, incorrect or outdated, this affects the output of the system. Incorrect bookings, delivery delays or incorrect information on stock levels are just some of the problems that can result. “Trash in – trash out” is what IT experts casually call it.
In addition, poor data quality makes automation more difficult, meaning you have to expect time-consuming manual corrections. This in turn affects the efficiency of the entire project. Thorough data cleansing is therefore very important for a smooth ERP implementation.
Important to know:
It is not enough to simply pay attention to clean master data when introducing ERP. If nobody makes the effort to consistently enter data into the system, all your initial efforts will come to nothing in the long term. It should therefore be a matter of course for your employees to record every transaction and every piece of information in the system without exception. This is the only way to ensure that your day-to-day business is fully mapped.
To-dos:
- Check that your master data is complete, correct and up-to-date.
- Clean up your data, for example by merging duplicates, correcting errors and deleting irrelevant information.
- Create a set of rules for data entry and introduce standardized formats.
- Train your employees and establish clear rules for data maintenance.
All points fulfilled? Then you are ready for the ERP implementation!
Were you able to tick off all 8 points on our checklist? If so, then you no longer need to worry. You are well prepared for the ERP implementation. If not, it’s better to invest a little more time in planning. Because mistakes in the design can end up being expensive.
However, you should not be too perfectionist in your approach. You must always reckon with unplanned incidents . These are usually minor delays or uncalculated expenses that are still within reason. A well-planned ERP project is robust enough to compensate for such disruptions.
Whitepaper on ERP implementation
In this Whitepaper, you can find out which mistakes you should definitely avoid when implementing ERP.
