How to Keep Your ERP Implementation on Track
When it comes to sticking to your ERP implementation budget and schedule, your chances are about 50/50. According to Panorama’s 2019 ERP Report, about 45% of implementations result in budget overruns, while 58% take longer than planned. These numbers indicate that a lot of software projects require more time and money than organizations expect, but they also show that staying inside your budget and schedule is possible. Plus, once your ERP is installed, you can achieve incredible gains in revenue and efficiency to make the software well worth the investment.
So how can you keep your ERP implementation on track to go live on its scheduled date without exceeding your budget? Following these steps will help your project stay on course.
Set Clear Goals
The only way to stick with your budget and timeline—and to achieve a successful implementation—is to establish clear project goals. If your project team doesn’t understand the end target for the implementation, how can they develop a plan, or even select the right ERP vendor? The project’s success completely hinges on clearly defining objectives.
Implementation goals should be based on current pain points as well as your vision for your company’s future. For example, if you see your organization expanding globally in the future, you’ll want to seek a solution with multi-currency functionality. If you’re experiencing issues with customizing customer orders, you should be on the lookout for a robust product configurator.
By undergoing business process modeling, you can diagram your workflows, detect problems and determine how your ERP can be utilized to improve processes and prepare your company for future growth. Once your project objectives are established and prioritized, you can build your budget and schedule around these specific goals.
Having unrealistic expectations is one of the leading causes of budget and timeline overruns. More factors contribute to the overall cost and duration of ERP implementations than businesses tend to realize. The price extends beyond the initial licensing fee to include any hardware, cloud hosting, consulting and training costs. ERP implementations also comprise of multiple stages such as data migration and testing which often take more time than companies allot.
You can develop realistic timelines and budgets by speaking to vendors, consultants and peers. Their estimations and anecdotes can give you a ballpark figure. Pairing this information with your unique project goals will help you put together a reasonable budget and schedule. Don’t forget to add some wiggle room to account for potential changes to the ERP project.
Though you don’t want to get too bogged down in the details of the implementation when estimating its cost and duration, you should consider the tasks involved in each stage. Isolating the project into stages makes scheduling more manageable and prevents you from leaving out essential activities.
Avoid Scope Creep
Along with unrealistic expectations, scope creep is a huge contributor to ERP scheduling and budgeting issues. Scope creep occurs when projects spiral out of control. New tasks and features get added on, moving the implementation further away from its original goals. Project teams become distracted by unnecessary customizations and features rather than stick to the plan.
This is why setting clear project goals is so important. The goals your company established early in the implementation should guide you until the go-live date. Otherwise, your ERP project could veer wildly off course, resulting in delays, extra expenses and a software system that doesn’t even provide necessary business improvements.
However, sometimes the project scope really does require adjustments. To take on new tasks without getting carried away, establish a process for proposing changes. Create a changelog where all suggested changes are documented. After a change has been proposed, discuss it with stakeholders and the project team. If most agree that the extra task will add value to the software and should be carried out before deployment, then the change can be approved. Otherwise, it’s probably best to wait until after go live to perform the activity. This managed, transparent approach prevents projects from extending your budget and timeline.
The ERP implementation changelog is just one way to keep your project organized. Without organization, your implementation becomes susceptible to costly errors and delays. Documenting project goals and use cases will help everyone understand the implementation process and stay on the same page.
Additionally, maintain clear communication. At the project kickoff meeting, make sure everyone knows their role in the ERP implementation and who they should report to whenever they have questions or concerns. Regular meetings with project teams and stakeholders should also be required to discuss progress and updates. Build communication and documentation into your implementation to keep it within the budget and schedule.
Bring on Consultants Early
Some businesses think they can undergo their ERP implementation on their own, only realizing they need help once their project has exhausted their resources. Sure, consultants are an extra cost, but their expertise is well worth it. They guide you in business process modeling, scheduling, budgeting and everything else throughout your ERP project. By enforcing ERP best practices, they mitigate risk from start to finish, so you can deploy your solution on time and on budget.
However, not just any consulting firm will do. Some firms lack experience in your industry or don’t follow a proven implementation methodology. You can’t count on a consultant who doesn’t understand your business to “wing it.” As you search for an ERP consulting firm, seek out certified experts with a record of executing successful software projects for clients that share similarities with your business. They’ll understand how to align your software to your processes without breaking the bank.
ERP implementations consist of many moving parts and require multiple considerations, but that doesn’t mean you can’t stick to your budget and schedule. Plenty of manufacturers and distributors have succeeded in implementing their ERP without cost or timeline overruns.
But these businesses probably didn’t do it alone. Premier ERP consultants, such as those at Datix, work hard to keep your software project on track. An Epicor Gold Partner, Datix has helped clients transform their business with software for over 20 years. Our certified consultants have a proven record for implementing ERP solutions that maximize ROI while staying within timelines and budgets.
To learn more about the ERP implementation process, get in touch with one of the experts at Datix today!