ERP & Business Automation

Phases of an ERP Implementation Plan

BY FirstBit | Published 2 September 2022 | Updated 2 September 2022
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7 Stages of ERP Implementation

ERP (Enterprise Resource Planning) helps you manage and automate critical operations, including HR, accounting, manufacturing, sales, and marketing.

Although ERP reduces operational costs by 23% and administrative expenses by 22%, half (50%) of ERP implementations fail the first time.

Therefore, from the moment you decide to implement ERP software in your company until it becomes fully functional, there are several crucial phases to take care of. And that’s what exactly we’ll talk about.

Key Phases of an ERP Implementation Plan

While there are seven phases in an ERP implementation strategy, they’re all interconnected. And while every implementation team will have its own process, some
stages are typical across the industry.

1 - Discovery and Planning

As you learn more about what your current systems do and don't do, it's a good idea to create a plan to help identify current issues you want to address via an ERP system.

You'll want to make sure you focus on every back-office operation, including but not limited to:

Financials (accounts payable and receivable)
Human Resources (payroll)
Sales

One way to avoid missing crucial details is to include people from every department of your business.

Remember, well-thought preparation is the key to success and can speed up the entire process.

Phases of an ERP Implementation Plan

2 - Integration Costs Budgeting


Several variables affect the total cost, such as the number of users, the company’s size, and the features you need. You should also consider the integration expenses as they might cost a lot because of the complexity of these connections.

Creating an estimate for the implementation, including integration expenses, can help avoid surprises down the line.

Here are some costs you need to include in your budget.

The number of integrations you need
System upgrades
Backups and storage
Employee training, customization, and ERP consultant’s fees

You should take productivity losses of employees into account (while they’re involved in the implementation process).

3 - Design


This is one of the major phases of ERP implementation because this is where you identify and create the components of your system and how they will work together.

The implementation team will examine all the processes and procedures to be implemented. They will also analyze gaps and the tools with overlapping features, so you can better integrate your systems.

Here are some best practices to ensure you accomplish your design phase goals.

Engage every department: Involve subject experts from every department, so you know what they expect from the system. It will also improve their understanding of how the ERP makes meeting their goals easier.

Design a data model: This requires you to look at your company's existing structure and determine where you want to improve or update before moving forward with the new system.

Create an intuitive user interface: This includes all the screens in the user interface and how they work together. For example, how users access specific menus or features from other screens.

Design an application architecture for business processes: Also known as end-to-end process flow. It includes how different applications are integrated, so they work together seamlessly. It would also involve integrating with third-party software solutions.

Design for mobile: ERP solutions are mobile-friendly, and most vendors have an app for you to access the system. However, the small screen can only hold up so much information. Therefore, ensure you design it to see the most critical data first.

4 - Development

The next step is ERP development and configuration. You’ll need a reliable partner to overcome the key ERP implementation challenges and ensure everything runs smoothly.

This is also where you’ll customize the tool to meet your business’s unique needs. So, it’s essential to take as much time as necessary to ensure you get them right. The customization process varies depending on what kind of customization you want (e.g., UI customization).

However, some general best practices apply across all aspects of ERP implementation:

Define user roles in advance so administrators can quickly set up permissions
Start with high-level business requirements before getting into details
Import accurate, up-to-date data to the ERP
Integrate your tools and legacy systems with the ERP
Create custom reports to stay atop the KPIs that matter the most

These steps ensure your ERP system is easy to use and can align with your current workflows.

Key Phases on ERP Implementation

5 - Testing

How do you ensure everything’s good? By doing a system test!

Testing the system ensures that your new software functions properly and does what you need. You can test either manually by running reports and checking data, run automated tests, or both.

It's important to know which parts of your software are most crucial, so they receive the most thorough testing attention.

ERP testing includes three stages:

Preparation is when you're planning out how your team will go about testing the system. This includes deciding what parts of the system need to be tested based on priority or risk level.

Execution is when all teams collaborate to ensure everything works properly before going live with your new ERP system. They'll also be documenting their actions in case there's an issue later on down the road.

Evaluation is when all parties meet again to discuss what went well during implementation and where you can improve.

6 - Deployment

Once you have tested the system and the processes, it’s time to deploy it. This is where things go live, and all your employees get to use the system.

The deployment plan should include a schedule for when different departments or functions within your organization will be transitioned over to their new systems. This is where you give necessary training to your employees.

This plan should also include who will manage each rollout and what tasks they'll complete during each implementation stage.

7 - Maintenance


Maintenance is an integral part of ERP implementation. And it is more than fixing bugs and glitches in your system. It is also about keeping the system updated and secure to ensure nothing affects your day-to-day operations.

The best way to approach this is by having an ongoing maintenance plan that keeps all aspects of your software up-to-date, secure, and running smoothly.

It is also worth noting that you will need assistance from your ERP vendor. They’ll help ensure you’re using the best practices for each module in the ERP and comply with the regulations.

Conclusion

An ERP implementation project is a complex undertaking that requires careful planning and execution. You can break the process down into different phases, each with its own goals and objectives.

The most important thing to remember throughout this process is that you implement it to improve business processes and add value to the organization.



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