major pitfalls of erp implementation in big companies
DESCRIPTION
This presentation lists the major pitfalls of ERP implementation in big companies from the perspective of Project Management and from the perspective of implementation methodologyTRANSCRIPT
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Major Pitfalls of ERP Implementation
Mohammed KhaiataTuesday 17th December 2013
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• According to Panorama Consulting Solutions; 2013– 172 respondents– 21% reported revenues over $1bn
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Agenda
• Ground Rules• Project Execution Pitfalls • After Go-Live Pitfalls• Open Discussion
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Ground Rules
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One size does NOT fit all
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Ground Rules
1. One size does not fit all; – Every implementation … • … is unique• … has to be aligned with Enterprise Architecture
– Best Practice is not a bible
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Ground Rules
1. One size does not fit all; – Best ERP systems are
NOT always ‘best fit’ for all companies
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Ground Rules
2. ERP means integrated processes– Ridiculous piece of data for one department
might play vital role in other– Inputs and outputs of every process must be
clear– It is NOT an IT project– Influencers might pull the control to their benefit
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Ground Rules
3. ERP means pre-packaged software– You can NOT shoot the moon– Much customization
then validate the solution
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Ground Rules
4. Management Commitment– ERP way
or the high way
– They don’t want headache
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Ground Rules
5. Right Stakeholders– Right representation of functional areas– Right balance of power– Different stakeholders at different stages of the
project– Right level of governance
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Project Execution Pitfalls
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Project Execution Pitfalls
• From Project Management PM perspective
• From perspective of implementation phases
Scope
Budget
Quality
Schedule
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Project Execution Pitfalls
• From PM perspective; Scope:– Not having clear and written • Request For Proposal RFP• Statement of Work SOW
– Not having defined modules and interfaces– Not having clear High Level Solution– Not having clear phases and milestones
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Project Execution Pitfalls
• From PM perspective; Budget:– Depending on Contract Type; T&M,
Lump Sum, …• Beware of internal resource cost• Beware of Schedule overrun
– Not having defined resource plan– Not having defined RICEW components
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Project Execution Pitfalls
• From PM perspective; Schedule:– Not having the right skillset– Not having dedicated time from stakeholders and
users– Not having on-time decisions– Not having enough planned time for data
conversion– Not having well-defined customizations
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Project Execution Pitfalls
• From perspective of implementation phases:
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Project Execution Pitfalls
• From perspective of implementation phases:
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Project Execution Pitfalls
• From perspective of implementation phases:
Oracle Application Implementation Methodology AIM
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Project Execution Pitfalls
• From perspective of implementation phases:
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Project Execution Pitfalls
• From perspective of implementation phases:
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Project Execution Pitfalls
• Requirements:– Not having signed detailed requirements– ERP means pre-packaged Software – watch limits– Not following the main stream while documenting
major exceptions– Consider approving new custom components vs.
reengineering business process– Not Gathering reporting requirements as early as
this stage
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Project Execution Pitfalls
• Design:– Not paying attention to business competitive
advantage– Not Standardizing business processes– Not having signed To-Be processes– Not having signed Authority Matrix and Roles and
Responsibilities (Segregation of Duties)– Not validating reporting requirements– Not sharing Data Templates as early as this stage
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Project Execution Pitfalls
• Configuration:– Avoiding detailed documentation– Not following defined checklists– Not having dedicated instance– Not Using real-life data
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Project Execution Pitfalls
• Testing:– Not having unit testing– Not having dedicated functional testing– Not having full-cycle cross-functional testing – Not having comprehensive and exhaustive testing– Not performing stress and performance testing– Not having signed User-Acceptance testing
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Project Execution Pitfalls
• Training:– Not having written tailored user manuals– Not identifying key users– Not ensuring hands-on training to key users– Missing influential users
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Project Execution Pitfalls
• Data Migration:– Master Data• Not starting as early as transitioning from Design to
Configuration • Not getting final and cleansed data• Neglecting cross-checking master data across sources
(legacy systems, excels, etc.)• Not quantifying the right volume of data
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Project Execution Pitfalls
• Data Migration:– Transactional Data• Tolerating standardized templates across all sources of
data• Not giving sufficient time for data collection• Ignoring proper cleansing through controlled sheets• Not Reconciling with master data• Not Reconciling across business functions• Not quantifying the right volume of data
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After Go-Live Pitfalls
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After Go-Live Pitfalls
• Running Parallel systems:– Double Effort– Attachment to legacy systems– Ongoing comparisons– If ever parallel systems will be there, then defined
timeline must be there
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After Go-Live Pitfalls
• Shutting down legacy system– Not keeping it as read-only– Shutting it down in the middle of reporting period
or business cycle– Ignoring influential users
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After Go-Live Pitfalls
• Putting the new system in action– Hidden Excel Sheets– Neglecting control points for key processes– Ignoring critical reports
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Open Discussion