5 Key Factors to Consider When Selecting and Implementing an ERP System

calendar iconMarch 6, 2024

An Enterprise Resource Planning (ERP) system functions as the backbone of an organization’s business practices and integrates and automates many internal processes and information systems across an organization. In our February 2024 article, Revolutionize ERP with Artificial Intelligence, we explored the evolution of ERP systems, how AI is augmenting the overall effectiveness and performance of these systems, and the various ways AI-enabled ERP systems are achieving strategic objectives across key business functions.

ERP projects can be costly, complex and risky, but they can also deliver significant value and competitive advantage to your organization. Selecting the right ERP solution and effective implementation of the technology will provide countless benefits. Nevertheless, even for the most prepared organizations, selecting the right solution and designing the most effective implementation and execution strategy can be a significant challenge.

In February 2024, Managing Director and Technology Services Leader of Global Public Sector Services for Cherry Bekaert, George DelPrete, hosted a podcast on ERP selection and implementation with Jeffrey Yates, Assistant City Manager of the City of Fayetteville, and Zach Salvato, Chief Information Officer of the Greenville Spartanburg Airport. Both Yates and Salvato have performed several ERP selection and implementation projects throughout their careers and thoroughly understand the requirements and risks involved with such a significant undertaking. The podcast explores key factors to consider and pitfalls to avoid when going through the ERP system selection process.

Identify your Business Needs and Goals

Prior to exploring available market solutions, it is paramount to have a clearly defined strategy and roadmap where the organization identifies and outlines its needs and goals. “Understanding what you are trying to accomplish and how you want to use the ERP solution to update and automate your processes is the first step an organization should take before even considering a solution,” commented Yates.

Identifying the problems that need to be solved and what features and capabilities are necessary to support business operations will help organizations narrow down options and zero in on the right solution. This includes taking a comprehensive look at your current systems and identifying areas where improvements can be addressed by an ERP system. Having this clarity will help establish that you are selecting an ERP solution that provides the capabilities needed versus having to build those capabilities into a system later.

“I don’t allow customization,” emphasized Yates. “When you customize later in the process, when you get upgrades, when you get new staff, all the collective knowledge of why it is the way it is goes away eventually, and now you’re left with something that doesn’t match what the developers built. So, I’ve always been diehard into the camp of don’t modify the software; modify your processes.”

Selecting the Right Partner

Ensuring the organization has the right resources and expertise in place to drive a change initiative of enterprise magnitude will be critical. Partnering with an experienced consultant specializing in ERP solutions can help guide an organization through every stage of the process to help maximize its investment.

“AZ full ERP initiative from selection through implementation should be considered a journey,” remarked Salvato. “It’s important for organizations to understand ERP implementations are comprehensive, factoring in multiple systems and various data, and even with the most meticulous planning and expertise, an ERP initiative may extend years before finalizing.”

Beyond understanding the intricacies and capabilities of various solutions, an ERP consultant needs to natively understand your business. Often, critical items that impact an implementation are lost in translation if there is not a comprehensive understanding of the business.

“When we hired Cherry Bekaert for our ERP implementation, they were extremely useful because they understood the business of government accounting, governmental operations, and nuances like fund accounting,” stated Yates. “They weren’t making blind assumptions about our business. They truly understood our specific needs and guided us, leading with insights rather than inquiries. The experience was nothing short of excellent.”

Preparing for Implementation

“Preparing an implementation plan includes really taking a deep look at your people, processes and technology,” unanimously stated both Yates and Salvato. Identifying what resources are in place and where there are deficiencies will be important prior to launching any technology initiative.

“It’s important to outline up front what kind of experience you want in implementing an ERP initiative and ensuring you have all the resources in place to achieve that outcome,” emphasized Salvato. Launching an ERP initiative will involve expertise and time outside of daily job tasks from every functional business unit. “If you don’t have the resources to do it, you really must think about either contracting out support or pausing the initiative. Some of the biggest haphazard implementations, or challenged implementations, are under-resourced implementations,” warned Yates.

Governance and Defining Key Roles

Ensuring you have the right leadership and consistent governance throughout the entire ERP project is paramount. “The sponsor of the project must be the executive team,” remarked Salvato. Every member of the executive team must understand the totality of the project, including vision and objectives, and be accountable for the successful outcome of the initiative.

An ERP system involves all functional areas of a business, and thus, each area should have a lead stakeholder in place to plan, provide feedback, and implement and/or oversee testing for their functional area. Functional lead stakeholders will be able to review project details from their practice perspective, plan for how next steps will impact performance, provide feedback and test nuances when needed.

Prioritizing Communication

Partners, sponsors and key stakeholders should be in constant communication throughout each phase of the ERP project. “Holding monthly or bimonthly meetings with key stakeholders to discuss status updates, insights and expectations was instrumental in our ERP implementation. Stakeholders are then able to contemplate the implications of next project steps and manage accordingly,” stated Salvato.

Important to the start of any ERP initiative is ensuring the organization fully understands the vision, objectives, and outcomes of the ERP implementation. Communication with the entire organization must remain fluid to maintain the project’s imperative and focus. Regular communication and status updates on the ERP project, including any challenges, are key contributors to a successful implementation. Communication helps with ensuring absolute clarity on an enterprise-wide initiative—a necessity.

Identification and successful implementation of an ERP system can transform an organization’s operations by improving efficiencies and streamlining processes, providing companies with the edge they need to compete. The selection and implementation process, although complex, can be done efficiently with the right stakeholders, proper preparation and proactively addressing potential pitfalls.

How Cherry Bekaert Can Guide You Forward

Integrating an ERP system into your business enhances agility, scalability and competitiveness, empowering organizations to adapt to dynamic market conditions and drive growth effectively. Cherry Bekaert can help your organization with digital transformation or ERP-related issues. This includes strategy development, validation, selection and project assurance. To learn more about how we can help with your ERP system implementation and deployment, please reach out to us today!

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