This is major and time consuming activity which involves analysis of the organizations processes, recommendation of good practices, mapping the processes to the package, data management, implementation and support. The choice of the implementer is a critical factor as the experience of implementation using standard approach and methodology for implementation, Project Management, Change Management are factors of success. Also important are the implementers knowledge of the client’s business processes, local conditions etc.
The key considerations for implementation are:
- Knowledge of application: ERP’s are designed on state of the art architecture using best practice business functions, hence knowledge of the application is essential for the implementer
Experience in implementation: ERP implementation involves adoption of standard approaches, ability to resolve situations and issues and transfer of knowledge. This relate to the experience of the implementer is a key consideration factor.
Reliable support: The ability to provide post implementation support is critical as a lot of issues arise once an organization starts using the application. The implementer necessarily needs to provide the support services after the implementation.
Internal Change Management: An ERP implementation entails changes in processes and reporting structure. Addressing this paradigm shift is a process that the organization has to go through. This will help in achieving the acceptability of the users to the new systems.
There are three drivers of change management:
- People: They are the key players in any ERP implementation. The people of the organization will be in the capacity of process owners, application users and administrators of the application. The challenge of an ERP implementation is to achieve the acceptability of the system to the people and for them to perceive the benefits to the organization and to their way of working.
- Process: One of the returns on investment is adopting business best practices by virtue of an ERP. These processes impact the efficiency levels to be attained by the organization.
- Technology: Implementation of ERP automatically entails adopting technology that will address scalability, death of distance and upgradeability to newer technologies.
ERP systems are theoretically based on industry best practices and are intended to be deployed "as is. ERPs offer customers configuration options that allow organizations to incorporate their own business rules but there are often functionality gaps remaining even after the configuration is complete.
ERP customers have options for customization to reconcile functionality gaps. Technical solutions include rewriting part of the delivered functionality, writing a homegrown bolt-on/add-on module within the ERP system, or interfacing to an external system. Key differences between customization and configuration include:
Customization is always optional, whereas the software must always be configured before use (e.g., setting up cost/profit center structures, organisational trees, purchase approval rules, etc.)
The software was designed to handle various configurations, and behaves predictably in any allowed configuration.
The effect of configuration changes on system behavior and performance is predictable and is the responsibility of the ERP vendor. The effect of customization is less predictable, is the customer's responsibility and increases testing activities.
Configuration changes survive upgrades to new software versions. Some customizations (e.g. code that uses pre–defined "hooks" that are called before/after displaying data screens) survive upgrades, though they require retesting. Other customizations (e.g. those involving changes to fundamental data structures) are overwritten during upgrades and must be reimplement
- Improves user acceptance
- Offers the potential to obtain competitive advantage vis-à-vis companies using only standard features