This document outlines the Protorative methodology for ERP implementations. It begins with background on typical ERP projects and their high failure rates. It then discusses the drawbacks of traditional methods like ASAP that do not allow going back to earlier phases. The Theory of Constraints is introduced as focusing on identifying and exploiting constraints. The Protorative methodology is presented as a prototype + iterative approach that gathers requirements through hands-on prototyping with users. Key assumptions and scheduling are provided, with advantages noted as faster timelines, less testing needs, and better user adoption.

1. 7/5/2010ERP Implementation Methodology1Yashpal Jain, Project Manager-SAP

2. AgendaCompanies without ERPERP ImplementationCurrent Business situation & Expectation from ERPReason behind project failuresOverview of ASAP methodology & its drawbackTheory of ConstraintsProtorative Methodology – Assumption/Schedule/AdvantageQ&A7/5/2010Protorative Methodology2

3. Companies without ERPModerate to high number of home grown systems.

4. Business functions or Systems are not integrated or at best loosely integrated.

5. MIS reports are generally overdue.

6. Management decision on market situation is often reactive.

7. Bird eye view of company’s status is not available to management.7/5/2010Protorative Methodology3

8. ERP Implementation7/5/2010Protorative Methodology4Implementing ERP is always Top down decision.

9. Decision to implement ERP is taken by watching market trend and relying on different agencies reports.

10. With Initial cost of implementation being high, ROI cannot be calculated in short span of time. It is at best over a period of 2-3 years.

11. Success of system implementation has different meaning to Client and Consulting partner.

12. Implementation timeline is aggressive and schedule slippage is very costly to business.

13. ERP systems are sophisticated and not as user friendly as legacy system.Current Business Situation & Expectation7/5/2010Protorative Methodology5

14. Current7/5/2010Protorative Methodology6Expectation

15. End Results??7/5/2010Protorative Methodology7Only two possible outcome ORSUCCESSFAILURE

16. Project Success Rate7/5/2010Protorative Methodology8“Studies by Standish Group and others for traditional project management methods, only 44% of projects typically finish on time, projects usually complete at 222% of the duration originally planned, 189% of the original budgeted cost, 70% of projects fall short of their planned scope (technical content delivered), and 30% are cancelled before completion”.“The success rate is even lower in case when companies are going for ERP system for the first time”.

17. Reasons behind project failures7/5/2010Protorative Methodology9

18. Definition of Success7/5/2010Protorative Methodology10For Consulting Partner/System IntegratorOn time Go-Live

19. In-Budget Go-Live

20. All open issues are closed before end of stabilization phaseFor ClientOn time Go-Live

21. In-Budget Go-Live

22. All open issues are closed before end of stabilization phase

23. Use & leverage the system as intendedIf we compare the meaning of success of both consulting partner and client, the only difference is using and leverage the system as intended. This is in fact the most ignored success criteria and deciding factor between success or failure of the project.

24. Issue in Leveraging ERP System7/5/2010Protorative Methodology11Statistics shows that the top 2 reason behind companies not able to leverage or realize full potential of ERP is Not all requirements were met during implementation of ERP.

25. Users are not comfortable running the system because not all desired functionalities are provided in system and lack of sufficient time spent on the system is hindering them to work as per management expectation.Project Success7/5/2010Protorative Methodology12With all the discussion and explanation of project’s success or failure, it is very easy to comprehend that on-time and in-budget go live are not the only of the criteria of successful implementation. It is User’s adoptability of ERP system which will decide whether project is success or not.

26. ASAP Methodology & Drawback7/5/2010Protorative Methodology13

27. ASAP Methodology7/5/2010Protorative Methodology14

28. During Project Execution7/5/2010Protorative Methodology15How often requirements are captured inaccurately, insufficiently or missed to be captured at all?