Enterprise Resource Planning (ERP) Implementation

Enterprise Resource Planning (ERP) Implementation The implementation of an ERP system can be one of the most important strategic maneuvers an organization undertakes. This paper will give a project plan template, for implementation. It will briefly discuss a sample case study. and, it will over some of the critical factors to a successful implementation. Enterprise Resource Planning Implementation Project Plan Template: The first step in the ERP Implementation is scoping.

Scoping involves establishing executive sponsorship for the implementation, defining the project scope and the accompanying organizational vision, identifying organizational knowledge leaders, developing a project plan, and conducting a kick off meeting for implementation. Next, in understanding and modeling. This step involves defining the current lines of business and future lines of business. Current organizational structure and future structure must also be determined. And organizational models must be confirmed. Current and future business processes need to be defined in this stage, including developing and confirming process models.

and, technical infrastructure, both current and future, must be defined. The next step is the implementation of best practices. This step includes identifying benchmarks and key performance indicators and possible process simplifiers. Industry best practices should also be defined at this stage. Any process simplifications should be tested, documented, trained and then implemented. Information Gathering is the next step in the ERP implementation generic project plan. This step includes preparing the request for information document, identifying the software packages and vendors available, and submitting the request to the vendors.

From this, bidding can begin. Software package evaluation is the next step in the implementation process. Evaluation criteria must be identified, and replies to the request for information from the vendors must be scored. From these vendors, a first cut list is determined and vendor product demonstrations can begin. Once demonstrated, these products can be evaluated further and finalists chosen. Best pricing is then received and evaluated and the software decision is finalized. The organization's infrastructure must then be evaluated.

This process includes requesting bids for infrastructure development, and evaluating those bids. An evaluation also needs to be done of the implementation and technical services provider, at this point. Management can then formulate a recommendation. In this step, project commitment and funding is finalized, a project budget is completed, as well as project investment analysis. Contractual agreements are finalized including final pricing which should include: training, license fees, upgrades, software maintenance and support, and any needed implementation assistance. From this point, actual implementation can begin.

This includes establishing a charter and team for implementation, educating the team, and modeling the business. The software is then configured and prototype processes are identified, along with any gaps. Technical solutions are determined, work is documented, and the system is evaluated for production readiness. Finally, end users are trained and the system is put into live use. The ERP system is then periodically reviewed, to ensure its effectiveness and efficiency and modifications and upgrades are implemented as necessary (Starinsky, 2000, p. 28).

During this phase, the organization may choose to hire a consultant to assist them in the implementation process (Dong-Gil, Kirsch, & King, 2005). Sample Case Study: Kelvin Hughes is a global supplier of navigation products. Their 20-year-old MAS manufacturing resource planning system is outdated and inefficient. It currently runs across three separate Unix systems and can't provide the organization with the business reports that it needs to remain competitive. As such, Kelvin Hughes is replacing the system with the IFS enterprise resource planning system on a Linux system (Saran, 2005).

The new ERP system "will be used to streamline and automate manual processes at Kelvin Hughes. It will also be used to give the company greater visibility of worldwide resources and allow it to schedule deliveries more accurately" (Saran, 2005). All items their old system could not handle. Critical Success Factors: According to Bingi, Sharma, and Godla (1999) Implementing an ERP causes massive change that needs to be carefully managed to reap the benefits of an ERP solution.

Critical issues that must be carefully considered to ensure successful implementation include commitment from top management, reengineering of the existing processes, integration of the ERP with other business information systems, selection and management of consultants and employees, and training of employees on the new system. The ERP software, itself, is one of the least important factors in the success of ERP implementation.

Certainly, it is important that the software selected functions adequately, but there have been times when two companies have implemented identical software, and one is an immediate success while the other is a disaster. Obviously, there are other factors that the organization's success hinges upon. The implementation process, itself, is one of these critical success factors, in particular the customization of the software to meet the organization's specific needs. Rarely will the ERP software work straight out of the box in the exact manner required for the organization.

For this reason, the base software package is often configured to meet the unique needs and create a tailored solution, for the organization (Vile & O'Driscoll, 2005). Another critical success factor comes into play when an organization has a clear vision of what they hope to accomplish at the beginning of the ERP initiative. This includes where the organization wishes to go and by when they wish to reach that destination. Strong and competent people must be put into the lead of the implementation process.

They must also have full executive-level support that not only approves of the project, but also gets involved in the implementation if and when necessary (Vile & O'Driscoll, 2005). Management involvement, not just commitment ("ERP implementations," 2003) Education is another critical factor of success, not just software training. This includes the basics of TQM, MRPII, and SCM. Also, the implementation team must have a clear understanding of which business process the system was developed to support. This team must focus on real organizational changes, not just clerical savings.

To ensure success the implementation must be seen.