What are the different phases of ERP implementation?
It is important for organizations to recognize that selecting best ERP software requires time and research. Apart from the ERP Software product selection, its implementation process is equally or probably more crucial. A great product may fail if its implementation is not good and an average product with a great implementation may bring great value to the organization. Organizations must have a proper roadmap for different phases of ERP implementation since it is a long process and can be challenging if they lack meticulous understanding of all its phases. So, for any project, it’s imperative that an organization takes the right steps at the right time.
Following are the different phases of ERP Implementation:
Project Kick-off: Generally, at this stage, the vendor team gives a presentation to the Client on the steps of ERP implementation and provides the Road Map. During this stage, the Project Implementation Team is introduced to the Client’s Team. Generally, till this point, only the Sales Team would have interacted with an ERP Selection Team on the Client’s side. A Kick-off Team is important as ERP implementation process is an enterprise-wide initiative and all the Departmental Heads/key users have to be made aware of the reason the Company is going ahead with the ERP implementation. Thus, Kick-off also forms a communication exercise and sets up the right expectations.
Discovery & Planning: Often called the “Client Discovery”, in this phase of ERP Implementation, an Implementation Team from the vendor’s side and a Project Team from the client’s side are formed. The Implementation Team understands the various elements and processes of the client’s business. A Project Plan is created by the Implementation Vendor and agreed upon between the two teams. The Plan comprises of Project Governance Methodologies, Resourcing, Deployment, Roll–Out Plan, Readiness Requirements, Testing Procedures, Go-Live Preparation Requirements, Escalation Routes, Sign-off Procedures, Risks Mitigation, etc. The existing loopholes, pain areas, and their potential solutions are identified during this phase. It is important that while users explain their existing processes to the vendor, they must visualize all the scenarios of a ERP implementation process and explain it to the vendor. A good Client Discovery exercise will ensure that the vendor is clear on the requirements and it will help in configuring their software better for the client.
Master Data Collection: This phase involves the collection and creation of Master Data. For this very purpose, the data related to the company’s chart of accounts, finished product, raw materials buyers, and vendors list etc. is collected by the client in the format desired by the vendor. This data is later migrated into the ERP so that the client doesn’t have to do so many entries. The migration is generally done for the Master Data only as the migration of transactions is not an easy process and is generally quite expensive and time taking. Normally it is advised that the client should keep their ERP legacy system on one of its systems for referral purposes instead of migrating the entire transactions to the new system. Only the open transactions should be moved to the new system. This phase generally goes in parallel with the Configuration/Customization phase which involves the vendor.
Configuration/Customization: Based on Client Discovery, the vendor configures the client’s processes into their ERP. At this stage, the client may be asked to do some adjustments to their processes to map them to world’s best business practices, which would generally be a part of a good ERP like ebizframe ERP. For some of the client’s Business Critical Requirements which can’t be configured, some customizations might be needed, provided they are feasible from the vendor’s product side. The user level and transaction level security are also set depending on the roles that a user is supposed to play.
User Acceptance Testing (UAT): This phase of ERP Implementation life cycle plays an important role in determining whether the system’s functionalities align with the agreed requirements. The users do the UAT as per the Test Data and Test Scripts provided by them. At the UAT stage, there could be some fine tuning to the ERP system software as the users may come out with some finer points when they actually start running the system. Generally, the UAT is done with the Champion Users (Key Users) and is done on the Test Servers.
Training and Knowledge Transfer: The new end users are required to get accustomed to the new system, and for that, they must be taught to use the ERP effectively. In this phase of ERP Implementation, the training is provided to the end-users. This can either be done by the vendor or by the Champion Users. If the Champion Users do the training, it is a good practice as this also helps in internal capacity building and reduces the organization’s dependence on the Vendor for further training activities.
Go-Live Checks and Deployment: Before the system is made “Live” it is important that the necessary checks are done within the organization for the Go-Live. This includes Software sign-offs from the Users, Hardware/Network readiness at each point of usage at each location, availability of necessary resources, etc. The ERP Software is then deployed on the Live Server. Normally, the most organization chose to Go-Live at one location first and then do successive roll-outs to other locations. This helps contain the initial teething problems to just one location and ensures minimum disruptions during the Roll-out.
Go-Live: In this stage, the company migrates completely from the old system to the new ERP System. This phase of ERP Implementation life cycle allows users to work on the application software with real-time data. Some organizations choose to run the legacy system in parallel for some time along with the new software. This gives them the comfort that the new system is working perfectly.
During this phase, there could be some teething troubles as for users it’s a new system and they may make some mistakes or may not have 100% understanding of the system. At this stage, the ERP Implementation vendors normally provide extensive hand-holding support (either onsite or remotely) so that any such issues are addressed immediately.
Post Implementation Support: The final phase of ERP implementation includes keeping a close watch on the performance of the ERP System. Periodic maintenance is provided for the smooth functioning of the system. The client is notified of the New Releases, along with the enhancements and fixes are done on the previous versions. Generally, all ERP software vendors have comprehensive Post Implementation Support Policies and it is recommended that the Client enters into an Annual Maintenance and Support Agreement with the vendor.
Conclusion: This blog is aimed to explain the different phases of ERP implementation life cycle. So, before going live with any ERP software, one can understand the complete implementation process carefully.