I am shocked how many “IT experts” miss the mark for successful software selection and implementation without surprises.
This probably explains why Gartner estimates approximately 75% of all ERP implementations fail.
So, what’s missing?
I have had several conversations with a colleague who is an ERP selection and implementation expert. How good is he? Well, in his 40 year career he has selected and installed 55 ERP solutions, for small businesses to multi-billion, multi-national enterprises…and NEVER had a failure.
He outlines several key steps that make his approach very unique and flushes out those factors that make for failure and surprises.
1. Begin with outcome of success. Work with all the stakeholders to define what a successful solution looks like. Make sure all parties buy-in to this successful vision.
2. Reverse engineer this successful vision to determine what processes and reports are needed, where the data comes from and how to get the data into the system. Get to the transaction level…debits and credits to make sure your processes and systems will successfully integrate to your accounting (an important step that is often neglected).
3. Create a detailed and clear request for proposal that includes ALL the new requirements (processes, screens, reports, data capture, etc.) so you have a clear idea of what ERP systems can satisfy your needs and what the software project team needs to understand to bid and implement the solution.
4. Make a short list of software providers whose software will fit your needs and budget. Clearly, if you are a $100 million business, Oracle or SAP may be WAY TOO EXPENSIVE (expect $3-$10 million or way more for the final system).
5. Once you have the short-list of software providers, identify the software project teams that can deploy this solution for you. Provide them with the detailed RPF with the following requirements:
- i. They must show you how the software can be configured to perform the processes you want with your data so you know it works.
- ii. Most likely you will not find a perfect fit. So, have the software project team present you a proof of concept for the functional gaps between what you want and what the software can deliver. It is CRITICAL the software project team can prove to you they can ALSO deliver on what the software does NOT do.
- iii. Have them include in their proposal to you the price and implementation schedule with all costs to deliver a copy of the software you want a) configured to your needs and b) with the extra systems that the native system does not include. Explain they get paid for each of the systems delivered that work with your data.
- iv. Not all of the software project teams will want to comply with your RFP. The short list includes only those who will.
6. Prepare sample data for testing. Besides common “clean data”, include “clean data” from weird and difficult processes to compare to validate each system from the software project team works.
7. Review the contracts for the software and implementation. This may require experience or expertise to make sure you include in your contracts terms and conditions to avoid surprises, such as increase to software maintenance, who really owns the custom software or data, how many servers can you migrate to without a transfer fee.
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