Tag Archives: ERP Project

What is project governance and how does executive oversight shape ERP projects?

ERP solution projects are strategic and will require strategic guidance

Transforming business-wide systems, and the processes that sit behind them, has long-term implications. It requires careful consideration and should be driven from the top, possibly guided by a strategic plan or digital business strategy.

While the work of completing tasks, liaising with implementation partners, coordinating training and internal communication is best left with the project manager and internal champions/sponsors—without genuine and visible support from the very top, the adoption of enterprise software is more likely to fail.

As well as backing the project management team, in many cases board directors and executives will provide formal project governance.

Taking accountability for how implementing a new ERP solution will enable the vision and go-to-market strategies of your organisation clearly fall under the remit of senior leadership.

When the Governance Institute of Australia surveyed almost 500 governance leaders about risk in 2019, it revealed leaders were most concerned about regulatory and legislative change, reputation damage, increased competition, finding talented people, and cybercrime.

A poor ERP software implementation can cause havoc: hampering your ability to remain compliant, secure, productive and responsive to customer’s needs, which in turn reduces your competitiveness and tarnishes your brand.

What is project governance and what’s needed to do it well?

Project governance is the layer above project management. It should be limited to high-level input about performance, risk, and issues that influence the success of a project—not day-to-day milestones.

Clearly defined roles and lines of reporting are important aspects of good project governance, to ensure that decision-makers know the boundaries, understand their obligations, and get useful information but aren’t bogged down in detail.

Digital strategy consultant Dr Malcolm Thatcher believes governance lies at the heart of IT investment failures. He said steering committees often don’t make the best use of member’s time and expertise.

He said, “Ideally the committee should spend 90% of their time on the project risks and issues, determining how the committee can assist the project team and provide them with clear direction.”

Why do some project governance groups lose focus and become ineffective? “A lack of focus by project steering committees is often matched by a lack of organisational focus on digital investment benefits and outcomes,” Thatcher argues.

It raises a key point. You won’t realise the full benefits of a new ERP solution unless your senior leaders know and embrace the role technology will play in enhancing your business and empowering your team.

Introducing a modern ERP solution—whether you’re stepping up from basic software or replacing legacy systems—can improve internal processes, make data more useable, streamline workflows and reveal deeper insights. It provides a means to do these things: if your whole business adapts with those objectives in mind.

Do you need help planning for a digital transformation? Leverage Technologies is a leading ERP solutions consultancy with hundreds of successful implementations to our name. Start a conversation today.

Why ERP Project Management is Key To The Success of Your Implementation

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Often overlooked by small to medium-sized businesses during an implementation of ERP Software – do not ignore ERP project management!

Make sure you allocate at least 10% of your ERP implementation budget to project management.

Key elements of Project Management for ERP implementations

ERP Project management is divided into two key elements – your ERP implementation partner project manager (part of the ERP implementation partner team) and your own internal ERP project manager. Even if you have the best external ERP partner implementation project manager always appoint your own internal project manager to assist with the management of your ERP project.

These ERP project managers will have responsibility for guiding the implementation through the various phases, managing scope change, budget control, ensuring decisions are made in a timely manner and reporting progress to the business.

A strong internal project manager will make a huge difference to the timely delivery (within budget) of your ERP software implementation.

Appoint a Project Manager to avoid the following challenges

Very often the delays associated with an ERP implementation relate to the following:

Slow decision making;
Poor planning of meeting agendas;
Unnecessary scope changes;
Unclear scope or poor communication to ERP implementation consultants;
Poor delivery of legacy data.

These issues can be resolved with careful ERP project management – by both the external ERP implementation consultants and your own internal ERP project manager.

Assuming you have chosen the right ERP implementation partner for your ERP software project they will provide you with a good project manager. Now the important aspect is your choice of internal ERP project manager.

Very few Small to medium-sized companies have dedicated IT or project management skill sets in their business. As a result, you will be asking someone in the business to take on the internal ERP project management role as a part-time role for the duration of the ERP software project.

For small to medium-sized businesses this is usually a three to six-month timeline.

What are the key skills required from an ERP Project Manager?

Let’s assume one of your accounting team members is happy taking on the internal project management role for your ERP Software implementation – let’s look at the required skills.

Good communication skills;
Good general business knowledge (accounting, operational and technology);
Highly organised;
Operates well under pressure;
Has the buy-in of senior management;
Is well respected by peers.

Your ERP software internal project manager will take responsibility for managing the following elements of your ERP Software implementation:

Budget vs Actual billing;
Scope changes;
Communication between the ERP implementation partner and your business;
Making sure that the ERP implementation partner gets access to the right people, the right technology, and the right data in a timely manner;
Company representation at project meetings;
Expectation setting;
Assist with change management;
Help create system documentation as required.

Conclusion

Appoint a strong internal project manager to manage your ERP implementation. This is another important step in the process of successfully implementing ERP software in a small to medium-sized business.

The team at Leverage Technologies has helped more than 250 Australian businesses grow smart woth Enterprise Resource Planning. Call 1300 045 046 or email [email protected] to talk to an ERP consultant in Sydney, Melbourne or Brisbane.

8 Reasons You Need Internal “Muscle” To Implement An ERP Solution

Internal “muscle” required to implement an ERP solution

Here is what I mean by internal “muscle”. Every business will need the following internal resources allocated to the ERP implementation project to complement the efforts of your ERP development partner:

Internal accounting skills
Internal project management
Availability of company resource
Company sponsorship from C-level executives

If you are a small to medium-sized business and you want to move off your entry-level accounting solution to an ERP solution then consider your internal resource and capacity as an important factor to ensure a positive ERP Return on Investment.

To clarify – I am not talking about large business ERP implementations. I am referring to smaller businesses embarking on their first ERP project. These projects typically take 4-6 months to implement.

The point to be made is not that you require teams of people to implement an entry-level ERP solution. The point is that you can’t allocate any internal resource to an ERP implementation.

Most small to medium-sized businesses will not be able to allocate full-time resources to the ERP project. In most cases, a financial controller is doubling up as a project manager or superuser for the duration of the ERP implementation. For smaller ERP implementations, this works.

What does not work is either the allocation of no internal resource (part-time or otherwise) to the project or the implementation of ERP without internal systems, processes and the right people. You can’t expect to successfully implement an ERP solution if you don’t have proper internal processes and people.

For example, if your business does not have an internal accountant with the skill set to work with an ERP team and articulate what the chart of accounts should look like then you might be heading for trouble. The setup of the chart of accounts is only one simple example of a challenge that you will face if you don’t have the required internal skill set to implement an ERP solution.

Let’s focus our attention on what is required to successfully implement an ERP solution

A full-time, internal, accountant. If you do not have the services of a full-time accountant to do your internal accounting, then you are most likely not ready for a full ERP implementation.

Business process mapping. If you are embarking on the implementation of an ERP solution you should have already mapped out your business processes. There is very little point in implementing an ERP solution if you don’t have your internal processes mapped out and formalized.

Access to internal resources for the ERP implementation. If you are implementing an ERP solution it is highly likely that you will use the services of an ERP reseller or implementation partner. The company that you choose will have responsibility for the overall implementation of the ERP solution. However, there is a responsibility on you, the customer, to be involved at every step of the way. This requires resources and time.

Super users. Every well-implemented ERP solution needs internal “super users” to keep the system running fluently. These super users take responsibility for basic admin tasks, first-line user assistance and training.

Data. You will need to get deeply involved in your ERP implementation data conversion process. This takes time (and knowledge of your data). Think of the time taken to export data from legacy systems, change data formats, test data after upload and reconcile with legacy data. Even with a lot of assistance from your ERP partner, you will need time and people to make these changes happen.

Train the trainer. Most ERP resellers are going to want to train the senior team members in your organization and then ask that these super users train other team members.

User acceptance testing. A critically important part of any ERP implementation. You will need to develop (together with your ERP implementation partner) test scripts. There will need to be a format for testing, the time assigned to conducting UAT and checking the results.

Project management. Even with Project Management provided by your ERP implementation partner you will need to provide your own internal Project Management resources. These internal resources will be required to deliver internal Project Management, communication and structure between your organisation and the ERP implementation partner.

Conclusion

Leverage Technologies have worked on ERP implementations since 2005 and delivered solutions to more than 250 clients around Australia. From our experience, every project requires internal work from the business to ensure successful delivery.

The amount of “internal muscle” that you need to deliver an ERP project will depend on the size and complexity of the implementation.

Another factor will be budget. If you are willing to spend the money a lot of the above-mentioned tasks can be outsourced to your ERP implementation partner.

Have we missed something? Let us know in the comments below!

4 Tips to Avoid ERP Budget Overrun Nightmares

Keep an eye out for this 4 high-risk ERP budget overrun areas

There are multiple elements to managing an ERP implementation and the associated implementation budget.

It all starts with having a realistic budget, good internal processes, a solid implementation methodology and the right resources (internal and ERP implementation partner).

Assuming you get all of these elements right, what can go wrong?

Let’s consider the four areas that typically have the highest risk of ERP budget overrun.

Data Conversion

Very often the most under-quoted part of an ERP implementation.

The challenge with data conversion is two fold – the amount of time that your ERP implementation partner has to spend on data import and reconciliation and the amount of time that your internal resource has to spend on data preparation, testing and data “confirmation”.

It’s never as easy as clicking the button and your data appears in the new ERP system.

Items that influence the ERP budget include

The number of different data sources
Current data formats
How “clean” is existing data
The amount of data to be converted
How well your internal team understand the data formats
What, if any, historical data is being converted.

The process should look something like this:

Decide on the data to be converted (master data, transactional and historical)
Use data templates to upload data into the new system
Export data in text format from existing systems
Perform test uploads
Do user acceptance testing, check the results, reconcile.

How to avoid ERP Budget overrun due to poor data conversion management

Depending on the outcomes of the test uploads you might perform additional testing before your final go live data conversion. If your business uses inventory then a stock take at go live is recommended.

To keep control of the data conversion budget make sure that you spend some time planning the conversion requirements during the scoping process. Allocate sufficient resource to testing.

Reporting

Yes, most modern ERP solutions offer standard reports and the ability to write your own reports but, you can’t underestimate the importance of specifying your reporting requirements and containing the scope and budget associated with report writing.

It is a great shame that so many ERP implementations fall short when it comes to true value add reporting, dashboards and KPIs.

The reason very often is either:

A lack of budget allocation to reporting
Assuming that the standard reports will suffice or
Not specifying your reporting requirements.

Avoiding ERP budget overrun

In summary, when it comes to reporting make sure that you specify your requirements, define the scope, allocate budget and “ring fence” the spending.

Most importantly do not assume that reports will be standard out the box and don’t assume that you can write your own reports.

I will add that most modern ERP solutions are now incorporating better, easier to use report writing tools that have pre-written data flows to allow users to create their own report selections and configurations. This is making life somewhat easier for reporting.

Integrations

Looking to integrate your ERP solution with a third party application?

E-commerce
billing engine
In-house solutions

Integration work can overrun substantially if not correctly scoped and managed.

Avoiding ERP Budget overrun

A well defined scope, careful project management and realistic budget and timing expectations will help.

Work closely with your ERP implementation partner upfront to scope in details all the integrations with third party platforms your new ERP system will have.

Development

Very similar to integration requirements, development work can be a source of major frustration for implementation teams and Project Managers.

Think of the steps involved to complete a development inside the ERP application:

Functional scope
Blueprint
Technical scope
Development
User acceptance testing
User training
Deployment
Go live
Go live assistance
Handover to support.

Development projects should be managed as their own “mini projects” within the broader project framework.

The challenge with regards to development and project overruns is that many development projects are a blank canvas – tell me what you want me to build and I will build it for you. As a result, there is a substantial reliance on getting the scope of works correct.

If not contained within a scope the development team will continue building and developing with no end in sight.

Avoiding ERP Budget overrun

The key to budget containment within a development framework is:

Careful scope (both functional and technical)
Comprehensive project management
Clear communication between client, functional consultants and development team
Realistic budget and timelines.

Conclusion

Technology is improving.

Cloud, mobility, analytics and other technological advancements dictate that customers want more value for money.

Careful management of an ERP project can deliver on time, real value to your business. Plan, co-ordinate and structure your project to manage all aspects of the implementation with specific attention on the data conversion, integration, development and reporting to guarantee an “on budget and on time” implementation.

Have we missed something?

Let us know in the comments below! What are other areas of your ERP implementation project you are particularly considered about to avoid budget overruns?