ERP Implementation: Avoiding Common Pitfalls

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Transparent tried and tested project management methodology to implement an ERP system based on my PRINCE2 and my own experience.

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ERP Implementation: Avoiding Common Pitfalls

  1. 1. ERP: Avoiding Pitfalls<br />General ERP Implementation Observations<br />Kirill Popadyuk<br />
  2. 2. “When anyone asks me how I can describe my experience of nearly 40 years at sea, I merely say – uneventful.<br /> Of course, there have been winter gales and storms and the like, but in all my experience, I have never been in an accident of any sort worth speaking about...<br />I never saw a wreck and have never been wrecked.”<br />From a paper presented by E J Smith, 1907<br />
  3. 3. On 14 April 1912, HMS Titanic sank with the loss of 1500 lives. One of which was its captain…<br />…E J Smith<br />
  4. 4. Statistics Is Far From Encouraging<br />79%<br />benefit realisation<br />59%<br />money<br />93%<br />time<br />worse than planned<br />as planned<br />source: Panorama Consulting Group 2008 ERP Report<br />
  5. 5. Top 7 ERP Failure Factors<br />Failure to train users sufficiently<br />Attitude to implementation as an “IT” project<br />Inability to secure cross-functional commitment<br />Lack of disciplined project management<br />Unclean data<br />Risk management being patchy<br />Excessive customisation<br />source: ERP Asia<br />
  6. 6. Early Warning Signals<br />Deadlines missed<br />Ambiguous requirements<br />No visible executive commitment<br />General absence of milestones<br />Employee turnover<br />Reporting is poor<br />source: ERP Asia<br />
  7. 7. project governance<br />project management<br />Implementation Methodology<br />risk management<br />change management<br />
  8. 8. project governance<br />project management<br />Implementation Methodology<br />risk management<br />change management<br />
  9. 9. The Ship Will Not Sail Until…<br /><br />Board takes clear ownership of the project<br /><br />Board provides dedicated resources<br /><br />Board determines the quality criteria and tolerances<br /><br />Board commits for contingency planning and audit<br />
  10. 10. The Ship Will Not Sail Until…<br /><br />Board takes clear ownership of the project<br /><br />Board provides dedicated resources<br /><br />Board determines the quality criteria and tolerances<br /><br />Board commits for contingency planning and audit<br />
  11. 11. So What This Mighty Board Is?<br />project board roles<br />manages provision of resources from multiple suppliers<br />governs the entire project to ensure delivery of benefits<br />delegated by the users to represent their interests<br />senior supplier<br />executive<br />senior user<br />can well be IT or consultants<br />shall not be IT, as conflict of interests is possible<br />can be sales, marketing, finance, etc.<br />
  12. 12. The Ship Will Not Sail Until…<br /><br />Board takes clear ownership of the project<br /><br />Board provides dedicated resources<br /><br />Board determines the quality criteria and tolerances<br /><br />Board commits for contingency planning and audit<br />
  13. 13. Stable Crew Throughout The Project<br />team member profile<br />in-depth knowledge of functional area<br />ability to see beyond functional area<br />excellent communication skills<br />does not have to be a process owner<br />a team player<br />
  14. 14. The Ship Will Not Sail Until…<br /><br />Board takes clear ownership of the project<br /><br />Board provides dedicated resources<br /><br />Board determines the quality criteria and tolerances<br /><br />Board commits for contingency planning and audit<br />
  15. 15. Perfect Clarity On Where We’re Going<br />implementing an ERP to turn it into a star later<br />automating key processes<br />we’ll see, we have time<br />implementing a benchmark ERP<br />
  16. 16. The Ship Will Not Sail Until…<br /><br />Board takes clear ownership of the project<br /><br />Board provides dedicated resources<br /><br />Board determines the quality criteria and tolerances<br /><br />Board commits for contingency planning and audit<br />
  17. 17. Contingency Planning<br />Cortez was sent to colonise Mexico in 1518. On April 22, 1519, he landed with a large armed contingent near the site of Veracruz. There he disassembled his ships – thus ensuring that his team would stay and fulfil their objectives.<br />
  18. 18. Prevention Is Better Than Cure But…<br />contingency options<br />start late and then... run<br />implement partially<br />change the scope<br />delay go-live<br />
  19. 19. project governance<br />project management<br />Implementation Methodology<br />risk management<br />change management<br />
  20. 20. Taking The Ship To The Destination<br /><br />the “what” – getting the system up and running<br /><br />the “how” – project manager’s toolkit<br />
  21. 21. Taking The Ship To The Destination<br /><br />the “what” – getting the system up and running<br /><br />the “how” – project manager’s toolkit<br />
  22. 22. From The General To The Particular<br />% completion<br />original<br />requirements<br />and gap analysis<br />risk analysis<br />start-up &<br />familiarise<br />time<br />
  23. 23. Enough Detail To Freeze Scope<br />% completion<br />signed-off<br />requirements<br />(incl. reports &<br />interfaces) plus<br />fully integrated<br />prototype<br />draft transition strategy<br />design &<br />prototype<br />start-up &<br />familiarise<br />time<br />
  24. 24. The System Is Ready For Go-Live<br />% completion<br />fully configured<br />solution that<br />passed<br />testing by<br />project team<br />final<br />data transition<br />plan<br />develop<br />design &<br />prototype<br />start-up &<br />familiarise<br />time<br />
  25. 25. Go-Live And First Period Closure<br />% completion<br />data converted<br />UAT passed<br />users trained<br />power users placed<br />first period closed<br />implement<br />develop<br />support plan<br />design &<br />prototype<br />start-up &<br />familiarise<br />time<br />
  26. 26. Handover To Support<br />% completion<br />close<br />implement<br />support contract<br />develop<br />design &<br />prototype<br />start-up &<br />familiarise<br />time<br />
  27. 27. Taking The Ship To The Destination<br /><br />the “what” – getting the system up and running<br /><br />the “how” – project manager’s toolkit<br />
  28. 28. Project Manager Thinks Work Packages<br />work packages<br />finance<br />sales<br />purchasing and<br />inventory<br /><br />payroll<br />data conversion<br />transition<br />
  29. 29. Functional Work Packages Are Similar<br />work package content<br />capturing/validating requirements<br />a functional<br />area<br />defining user roles (SoD)<br />creating test case scenarios<br />controlling<br />prototyping and development<br />customising training materials<br />identifying interfaces<br />
  30. 30. Data: Volume Brings Complexity<br />work package content<br />enriching masterdata<br />data conversion<br />cleansing masterdata<br />developing masterdata strategy<br />liaising with technical consultants re data specs<br />transferring opening balances<br />transferring transaction data<br />
  31. 31. In The Suit Of a Transition Manager<br />work package content<br /><br />overseeing user integration test<br />transition<br />overseeing user acceptance test<br />overseeing handover to support<br />prioritising remaining issues with technical consultants<br />coordinating ramp-up plans by area<br />maintaining go/no go checklist<br />
  32. 32. project governance<br />project management<br />Implementation Methodology<br />risk management<br />change management<br />
  33. 33. Making The System Stick<br /><br />knowledge transfer strategy<br /><br />communication and involvement strategy<br />
  34. 34. Making The System Stick<br /><br />knowledge transfer strategy<br /><br />communication and involvement strategy<br />
  35. 35. Particularly Important For Dynamic Business<br />pumping knowledge in<br />managing training<br />overseeing user manuals<br />creating power user institute <br />placing project team back<br />
  36. 36. Making The System Stick<br /><br />knowledge transfer strategy<br /><br />communication and involvement strategy<br />
  37. 37. Mapping All Stakeholders Affected<br />high impact<br />low impact<br />high influence<br />low influence<br />
  38. 38. project governance<br />project management<br />Implementation Methodology<br />risk management<br />change management<br />
  39. 39. Risk Identification From The Beginning<br />sample risk log<br />
  40. 40. Raising Issues ASAP By Anyone<br />sample issue log<br />
  41. 41. Monitoring Project Risk Profile<br />2<br />high impact<br />1<br />4<br />low impact<br />high probability<br />low probability<br />

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