Augmenting our previous post in the ERP Know More series, our second post intends to help businesses understand the issues that may emerge while migrating from disparate software solutions to ERP and enlists the best ways to ensure smooth migration.
Many small firms that are still using disparate software to manage various business functions often feel wary of moving to an ERP platform, since they feel this might lead to lots of migration issues. Well, a little more understanding is all that is required. If organizations wish to set up an IT backbone so that they have a system in place as they grow year after year, implementing an ERP is inevitable. Hence the sooner they take the plunge, the better. A transparent system with the right controls and validations will help them in their growth phase. While the first year of implementation will be tough, it is a necessary evil and companies go through this period keeping in view the long term benefits of the ERP implementation.
Legacy systems are usually disparate systems that are not properly integrated. Hence duplication of data and integrity of data is always an issue. They also lack the best business practices that are a given in any ERP software. As the business grows, the legacy system does not scale up accordingly. Hence over a period of time, the system has performance and stability issues. The technology also gradually becomes obsolete. The earlier we migrate, the fewer issues we deal with, so that we don’t end up losing the shoe for want of a nail.
To understand better, let us go through the need for moving to an ERP solution and the advantages it offers. Growing organizations often find it difficult to retain business efficiency, employee productivity, and responsiveness to customer needs. Businesses are hindered by lack of technology or systems that simply cannot keep up with growth, lack the functionality to support daily business operations, and cannot scale up to a growing customer base.
An ERP model is the ideal fit for companies, to overcome these challenges and push forward.
To begin with, in the previous post, we discussed that fundamentally, an ERP implementation is going to impact almost every department in your organization, thereby linking almost all your applications. Here are some issues that can crop up when an organization (especially, small and mid-sized ones) migrates from disparate software solutions to an ERP platform at various levels.
• Management level
o lack of a change management policy
o lack of adequate participation from the top management
o excessive expectations
• User level
o Resistance to using a new system
• Vendor/implementation partner level
o inadequately trained resources
• In-house IT team's level
o Allowing inappropriate resources to handle the system
From Ramco, we give you some best practices that you can adopt to address the pitfalls or implementation challenges, to ensure smooth migration to ERP.
The first of these best practices is to involve all users in the planning stages of the process. During the planning stages, a time line and budget needs to be devised. This helps the company stay on track when things get rough or unsettling. It is also imperative that all employees are aware of the current organizational scenario, and how things will transform in the near future. ERP applications should be aligned with business imperatives, by not marginalizing the potential gains. In the same vein, companies should keep medium- to long-term objectives in mind at all times, and avoid shortsighted decisions.
The best practices of ERP implementation also involves, finding a good software vendor and implementation partner who merges well with the vision of the company for the change management. This ensures that there is no difference of opinions across the organization.
To sum it up, best practices we suggest include
- Earmarking a dedicated ERP team with required empowerment before the onset of the implementation so that the implementation goes smoothly and in a focused manner.
- The organization should be willing to look at and embrace the generic and best business practices offered by the ERP with minimal customizations.
- In the post go-live period, the dependence on the vendor should be consciously reduced even if it puts strain on the users. This helps in attaining self-sufficiency faster and thus minimizes additional costs.
For all the advantages that an ERP system brings with it, expecting the implementation hiccups, understanding the new system better and working in accordance is but a fraction of the total effort involved. So, why should we compromise when there is an easy way to plan and handle our development!
Contributed by Ashok Dash