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Introduction Best Practices for ERP Implementation Understand business processes and key requirements. Build a business case for ERP with a positive ROI Ensure proper project management and resource commitment Gain executive and organizational commitment Recognize the value of early planning Focus on data migration early in the implementation process Invest in training and change management Know why you're implementing ERP The Value of a Structured Methodology About Epicor 1 2 2 3 4 4 5 5 6 6 7 8
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Introduction
The role of Enterprise Resource Planning (ERP) systems in managing business processes has expanded significantly over the past decade from a focus on specific business areas such as manufacturing, procurement, or human resources, to broader use throughout the company. Although IT has traditionally been responsible for specifying and implementing technology within an organization, successful ERP implementations require involvement from stakeholders at all levels, from executives to end users. For many companies, the transition from existing traditional systems to a new ERP one can consume significant corporate resources, including time, expense, and risk to business operations. However, as well explore below, this need not be the case. Panorama Consulting Solutions, an ERP consulting firm based in Centennial, Colo., publishes an annual report on the state of ERP worldwide. Their most recent report1 found that 54 percent of ERP implementations take longer than expected, while 56 percent of these implementations exceed budgeted costs. As Figure 1 shows, less than 50 percent of implementations achieve expected benefits, while only 17 percent of the companies experienced more than eighty percent of their projected benefits. Figure 1: Percent of Benefits Realized in ERP Implementations
Source: Panorama Consulting Solutions Eric Kimberling, president and founder of Panorama Consulting, believes that one of the reasons that ERP implementations take longer than expected or fail to achieve their expected benefits can be attributed to the high degree of code customization used to tailor ERP systems to business requirements (see Figure 2). The research shows that 60 percent of companies perform some degree of customization which can contribute to longer implementation times and higher costs.
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Source: Panorama Consulting Solutions Of course, customization is only one of the factors that can affect an ERP initiative. Many of the issues associated with difficult or failed ERP implementations can be avoided by adopting the best practices described below.
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activity, resulting in a static set of requirements for vendor selection. Instead, it should be viewed as an ongoing process that can be refined on a regular basis to reflect the changing needs of the organization. Finally, make sure that the ERP software's technical capabilities match the defined business requirements. Many companies concentrate more on the technical aspects of ERP software, rather than on what requirements are most important to the business. Software features or functionality that dont align with the companys business needs often lead to an unnecessary waste of implementation resources, time, and money that might be better spent on other activities such as software customization or training.
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Source: Epicor Software Corporation The Signature Methodology highlights the importance of developing a solid business case for the ERP initiative at the outset, one that presents a positive ROI and KPIs that accurately capture the business processes to be measured throughout the implementation. Its no accident that Epicor Softwares methodology and Panorama Consultings best practices agree on many of the same implementation principles; they are based on the similar experiences and lessons learned from hundreds of ERP implementations. While every ERP initiative is different, following these best practices may spell the difference between a successful ERP implementation and a failed one.
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About Epicor
Epicor Software Corporation is a global leader delivering business software solutions to the manufacturing, distribution, retail, and service industries. With more than 40 years of experience, Epicor has more than 20,000 customers in over 150 countries. Epicor solutions enable companies to drive increased efficiency and improve profitability. With a history of innovation, industry expertise, and passion for excellence, Epicor inspires customers to build lasting competitive advantage. Epicor provides the single point of accountability that local, regional, and global businesses demand. For more information, visit www.epicor.com.
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This document and its contents, including the viewpoints, dates and functional content expressed herein are for informational purposes only and are believed to be accurate as of its date of publication, October, 2012. However, the contents are subject to change without notice and Epicor Software Corporation makes no guarantee, representations or warranties with regard to the enclosed information and specifically disclaims, to the full extent of the law, any applicable implied warranties, such as fitness for a particular purpose, merchantability, satisfactory quality or reasonable skill and care. Epicor, Epicor Business Inspired and the Epicor logo are trademarks of Epicor Software Corporation, registered in the United States and certain other countries. All other trademarks mentioned are the property of their respective owners. Copyright 2012 Epicor Software Corporation. All rights reserved. Job#1,979.