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Consultant
opinion
ERP
(Enterprise Resource Planning)
implementations: secrets and traps |
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Businesses
worldwide are under increasing
pressure to improve performance.
Romania's future EU accession
is accelerating the companies'
need to cope with a more
competitive business environment.
Reengineering core business
processes is not enough,
as IT must support and enable
increasingly complex business
practice. This is what an
ERP system typically delivers.
ERP implementations are
littered with tales of lost
millions and implementations'
failures. So what are the
secrets? What are the traps?
Here are a few things the
Vendor and the Technical
Consultant (the one who
implements the IT integrated
system) are not going to
tell you about. They are
by no means the most important,
but they are missed in many
implementations. We base
our knowledge on several
successful first1 and second
tier2 ERP systems selection
& implementation for
top
players in various
industries.
Understand implementation
drivers
The Client's Business Vision
will drive an implementation
that falls somewhere along
three key implementation
approaches: Redesign driven3
, Industry Model driven4
, Technology driven5. Ensight
Management Consulting is
typically working on the
client's side, independent
of the Technical Consultant,
assuring the Transformation
of the client's organization
through overall project
management & processes'
re-engineering. Be aware
that, in most cases, not
using a business consultant
implies limiting the business
process improvement to standard
IT package functionalities.
Address all categories
of costs
Most organizations do not
understand from the beginning
the full costs associated
with an ERP system. The
benefits are usually well
understood, the Vendor will
make sure of this. Implementation
effort will be bigger then
ever talked about, or even
imagined. Ensight Management
Consulting is one of few
business consultancies that
can proud with successful
implementations in schedule
and/or under budget. The
starting point in Controlling
and Managing the
implementation process is
the TCO6 analysis where costs7
are presented distinctly
and compared for all the
possible IT solutions/technical
consultants.
Focus on critical
functionalities
Because of the richness
of functionality, the "toy
box effect" can take over.
Users see all the functionality
available and suddenly they
want it now. The scope can
grow out of control. Ensight
has managed this issue in
all implementations by analyzing
and determining functionalities
that are critical to your
operations. Customization
can be very expensive, so
it has to be done only for
key areas. Together with
your team, Ensight Management
Consulting can define and
Integrate a strategy
that best serves your needs,
your stakeholders and your
wallet.
Understand business
process effects
The existing environmental
mix between what is done
manually and what is done
by the system will swing
dramatically after implementation.
Many more tasks will be
automated, which may significantly
reduce the flexibility of
how you operate as a business.
Things have to be done consistently,
special treatment may not
be possible any more without
changing the configuration
of the system. If the system
says you can either have
0, 15, 30 or 60 day credit
terms, you can no longer
offer 45 day terms without
changing configuration.
If consistency can be implemented,
there is good potential
for cost savings as well
as getting rid of special
arrangements that reduce
profit. The harmonization/optimization
of business processes is
a standard Ensight Transformation
instrument that our clients
can benefit of.
Change management
and training
To successfully take on
an ERP system, an organization
needs to change it's corporate
culture. Business process
transformation does not
include only technical aspects.
One of the most difficult
parts in change process
is to transform attitudes
and the way people think
and act. Except for the
multinationals where knowledge
and managerial practices
were imported "at package",
few Romanian companies have
developed a solid corporate
business and entrepreneurial
culture. Staff needs to
change their focus from
their own job, to the whole
organization, from turnover
to profit. What they do
in their area has impacts
in places they may never
have envisaged.
Ensight Management Consulting
can help you to thoroughly
understand the background
of the transformation
process, the transformation
drivers and how the business
will evolve in the future
so that we can ensure that
change is business driven.
Starting from confirmed
strategy and the defined
SMART targets, the change
process must include plans
for discovering leaders
and change agents throughout
the company and assigning
responsibility for design
and implementation of the
strategy down. Ensight's
consultants often play the
change agents or Interim
manager's role, trying to
ease the transition and
to make it more "tolerable
".
Changing work flows and
practices require extensive
business
training to be
carried out, except for
the ERP utilization trainings.
Ensight Management Consulting
can help you develop new
competences within
your organization, increase
productivity and improve
the employee's performances
by transferring the skills
necessary to manage more
efficiently all daily activities.
Ensight
Management Consulting
is a management consulting
company which now integrates
complementary
competences from
the fields that it has operated
in: management, IT, legal,
finance, communication and
marketing. These complementary
competences, along with
the experience gained in
consulting projects
developed both for multinational
and local companies, recommend
us to support some of the
most complex projects.
Contact
us now to find
out how we can help you
achieve your business objectives.
________________________________________________________________
(1) SAP, Oracle
(2) Scala, Microsoft Dynamics
Nav
(3) Used when clients require Business Performance Improvement (BPI) work to utilize the package and to improve their business system as a whole
(4) Used for clients who prefer to use a standard industry model as the foundation of their business processes
(5) The chosen package supports their current business processes with minimal change
(6) TCO - Total Cost of Ownership
(7) Typical: infrastructure, license, training, technical implementation and project management costs
Daniel Voiculescu
Ensight Consultant
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