As organizations implement new enterprise resource planning (ERP) systems as part of digitization, process improvement and platform modernization, it is becoming increasingly critical not just for IT, but also for the business units themselves, to understand their central role in the overall success of these initiatives. The implementation of an enterprise system, or any other major IT system, should never be viewed as just an IT project because, ultimately, it is a business project with business objectives.
Even when a project is supported by a strong system integrator, it is critical for business stakeholders to assume responsibility for key activities before, during and after the implementation. Failure to do so can lead to project delays, budget overruns, business disruption and low user adoption, among other things.
There are seven key responsibilities that businesses need to understand and accept in any successful system implementation. They are:
Program Management and Governance – Although most system integration firms provide project management capabilities, common gaps include oversight of internal business and IT resources, management of other vendors, and engagement with company leadership. Proper oversight requires a more robust approach, from the establishment of a project management office (PMO) structure and assignment of roles, to the establishment of a comprehensive program-wide plan and a “single source of truth” for program status.
Business Process Readiness and Solution Design – Systems integrators are usually technical experts, not business process experts. Businesses should define the vision and operational expectations of a new system with regard to each business process. Specifically, the business must ensure that the technical solution the system integrator proposes will satisfy the business process vision and future-state goals. To meet operational expectations, the business should design process models for the end-to-end future state of each business process that the new system will impact. This will help system integrators focus on blueprinting rather than designing future processes, which typically is not their core expertise.
Organizational Change Enablement – As the solution design is established, the organizational impact of system and process changes must be determined to ensure that the anticipated benefits are realized. Training alone is not sufficient. Ultimately, the goal is a change enablement plan that will raise awareness with key stakeholders, obtain their buy-in and ensure their commitment to support the changes and the performance improvement objectives of the initiative.
User Acceptance Testing (UAT) – The final and most important phase of system testing, UAT, is designed to ensure that the system does what it was designed to do and that it meets user expectations. UAT must go beyond prior functional and technical testing phases. UAT scenarios should cover all business processes end-to-end, include all critical real-life data variations and be validated by process owners.
Data Conversion – This critical aspect is often overlooked by the business, but it is one of the most critical implementation processes, and a common source of project delays. No two systems are alike, and data from one system will rarely map cleanly or directly onto a new system. Data quality issues in legacy systems can also cause delays. Realistic data is critical to UAT. The business, supported by IT, typically owns data conversion design, mapping, enrichment, validation and cleansing. Start the data conversion process early.
Data Governance – To ensure that master data and transactional data are employed appropriately and consistently throughout the organization from go-live forward, the business should develop a comprehensive data governance program that includes a framework of organizational roles, a “data dictionary,” defined metrics and documented policies.
Business Intelligence (BI) and Reporting – BI and reporting should not be left as an afterthought, with the presumption that they can be addressed after go-live. For most users, the primary benefit of an enterprise system is ease and accuracy of reporting. Ensure that the BI and reporting requirements are fully incorporated into the design phase of the implementation and tracked throughout. The ease and flexibility of reporting is highly dependent on the quality of the architecture and design. The efficiency and integrity of the business process is dependent on the availability of information at the right time and place.
Enterprise systems can bring remarkable efficiencies and return on investment, or be massive failures – and the business, not the integrator or IT, is ultimately responsible for the outcome. For a more in-depth analysis of these and other implementation challenges, download our recently published white paper, Understanding the Responsibilities of the Business During an ERP System Implementation.