From the concept to the success - BPX

The way which the company has to get through to implement ERP system.

The successful implementation of ERP system changes a company in relation to IT and almost the whole company functioning. It is the next step to the development and the improvement of market competitiveness.

Nowadays, in order to prosper well and to develop along with market, each company should consider implementation of advanced information solution. There have appeared different systems which support the companies in limiting costs related to their activities. To choose an optimal system for a given kind of market, we need to decide which aspects shall be exactly adjusted.

ERP system (name is taken from Enterprise Resource Planning) is a unit structure package of information solution. It includes modules such as: Accounting, Management, Human Resource, Sales and Distribution, Business Intelligence and many others. All units are integrated so circulation of information is automated. The integration enables to create different kinds of balances and economic analyses.

The first step towards the effective implementation of ERP system is to define the overall business purpose but it is also important to align it with the company’s mission. Please note that you cannot ignore this process because it has an impact on the entire venture. Taking into account the course of implementation, the first stage (which is part of the above-mentioned statement of purpose) is the most important. Any errors made during the implementation, despite the successful technical implementation, may have negative effects and can prevent from meeting the business requirements. One of the basic assumptions in the definition of such a purpose is its measurability. It is important to define it in such a way that later it will be possible to check the efficiency of a system. Please note that if the system does not bring tangible results in the form of profits in the pre-implementation calculation, it should not be implemented. While planning the purchase it is also important to specify less important business objectives related to various processes and departments of the company.

After the stage of the determination of aims, the company can proceed in two ways: analyze the current situation and identify the main areas on which it should focus during the implementation on its own or use the services of third parties (consulting companies). A company which chooses the second option can select a company that will be at the same time engaged in the system implementation. Today, successful companies provide implementation services based on an analysis of the company and assistance in choosing the appropriate system as a separate element of the bid. Examination of the current situation will help to avoid errors that will make the purchased ERP system, or its individual modules, not adequate to the needs of companies related to this system.

When the choice of third parties has already been made, the whole process connected with the technical and technological aspects of implementation begins. It is important to develop a group of people, especially for the project, which will be solely responsible for the different elements of the process. Another important step is the selection of the implementation method. The chosen methodology identifies the different stages and steps that will have to be made during the actual implementation. The best way to choose the method, is to look for one based on proven solid basis, and which has already been successfully used in other companies. The method includes all the activities from preparing the project to the testing phase of the system. It is a tool that synthesize and supports the work of all those involved in the implementation. It is an action plan, in which each participant of the process has his or her functions, tasks and powers determined in the implementation process. Each company responsible for implementation may have its own implementation method (preferably when it is developed on the basis of own experience), so while making a choice it is important to get information about the kind of method used and to learn about it as much as possible. Depending on the company, that method may have a different number of stages (from 3 to 11), but while considering a particular method it should not be the main argument, of course. Important, and perhaps the most important, is the previously mentioned efficiency of the method, i.e. in which companies process of implementation was made by this method (it is also important how many), what problems appeared during implementation, etc.

The process of implementation may vary depending on the chosen method, resources for implementation, the company powers, etc. Both external and internal factors may have the impact on the implementation of the project. The external factors are those which are not connected with the company and with the implementation specialist. In contrast, those connected with them are the internal factors of the project. Even with the best-planned implementation of ERP system and experienced implementation company we cannot avoid all risks. We can prepare for them in order to deal with them quickly and efficiently. A viable solution is to create, together with implementing company, a list of potential threats that exist in your company and its environment and then to develop solutions to them. It will reduce the risk of delays in the implementation process.

After the technological implementation, it is necessary to deliver the end-user trainings so that they will know how to operate the system. Then, in the next stage, it will be possible to start testing the implemented system. In this phase you can directly notice whether the employees are well trained in the tasks they will perform on the implemented system and – in some cases it is even more important – you may get to know their approach to the whole project. In addition to the technical aspect of effective implementation, workers’ approach to possible changes has also got an impact on the effectiveness of the system. It is commonly referred to “soft” implementation. If in the initial phases of the project management will not be able to convince employees about the necessity of the entire investment, it will create risk that the project will not achieve maximum results.

If the system testing has been completed nothing remains except to start production startup, that is to start using the implemented system in the daily operation of the company. At this point it is important to make the transfer of data to the system. To do it as smoothly as possible, you should create a specific timetable, which will include not only the sequence of data entered into the system but also a list of people responsible for each of the data with the date of the execution. Any small problems that may appear in this phase (large, if they were, should be resolved in the latest stage of testing) should be solved by implementing company. The period which includes the support after the implementation can be one of the factors determining the choice of that company.

The implementation of ERP system is one of the most important decisions in the operation of the company. ERP system changes not only the information technology bases but also affects the way the management and business operation processes. Carefully selected and well implemented system will contribute to the evolution and development of the company. Purchasing ERP system can be considered as investments with very high growth rate.

Author:
Marcin Puchlik
SAP Consultant in Financial and Asset Accounting