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How to Develop a Successful ERP Software Strategy


Published on: 05 Dec 2020

By Vignesh N

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With all industries geared towards digital transformation, many businesses have already deployed an ERP software solution to automate their business processes. An enterprise resource planning software solution handles everything seamlessly from the supply chain and production line to the manufacturing and delivery of goods.

If you are still in the process of deciding when it is best to implement an ERP system, understand that it takes more than just choosing the right software vendor with the best solutions. It requires having an ERP software development, deployment, and migration plan laid out to ensure that the system provides the greatest benefit to your company with the least amount of risk.

How to Develop an Enterprise Software Strategy

ERP implementation entails hefty costs and requires the engagement of everyone in the company. For the efforts not to go to waste, you must craft an ERP strategy that delineates the steps that should be taken before, during, and after getting an ERP software solution.

Your strategy depends on your specific requirements and needs. Here’s a guide you can follow for your software strategy planning. Tweak the guide to adapt to your company’s unique conditions. Keep in mind that the more detailed your strategy is, the better are your chances for success.

1. Identify key improvement opportunities

Before you set your goals, determine which areas of your business need to be improved. Functional and strategic improvements require knowledge of daily tasks from the ground level. So, interview employees and management and ask about pain points they encounter regularly. Addressing these hitches in the process can lead to better employee performance and improved work productivity.

2. List your implementation goals

Your next step in strategic planning is to identify what you want to achieve upon deployment of your new ERP system. These goals can be business-centric, process-oriented, or a combination of different goals. Are you looking to centralize HR functions to track employee performance better? Do you want to streamline your sales process? Knowing your integration goals will help you determine what software features you need. It will also help the software vendor find the best ERP solution for your business.

3. Set a budget

Successful ERP implementation necessitates stringent financial planning. It is not uncommon for businesses to exceed their initial budgets once the system is deployed, especially if no software strategy planning was set in place.

When you set a budget, cover all upfront costs and appropriate funds that will support the entire implementation process. Set a contingency fund to cover any overrun costs. Also, your current infrastructure may require updating or upgrading to support the installation of a new ERP software. So, include these upgrades in the budget as well.

Be upfront with your vendor regarding your budget. If there’s no software solution that fits within your budget, consider putting off the ERP implementation until you have enough funding for it. Otherwise, you might end up wasting money preparing for an ERP software solution you can’t afford to deploy.

4. Create a change management plan

Any ERP software is effective only when people know how to use it properly. You will need a change management plan to reinforce the importance of the ERP solution and its proper use. Allocate training resources to help your employees understand how to use the new software. This training is an essential part of the implementation process and will help maximize the benefits your business can reap from the software.

5. Conduct a risk assessment

Don’t jump on the bandwagon just because everyone else is deploying the latest ERP software. Weigh the cost, risk, and benefits it can bring to your business. An ERP solution does bring high value, but it also comes with high risks, especially when things go wrong during the implementation. Conducting a risk assessment not only helps you weigh the risks but also enables you to be proactive rather than reactive.

Compare potential improvements to your current status. Do they far outweigh any risk you might encounter? In what areas might snags occur, and can these be prevented? Once you identify possible risks, you can address them before the installation begins.

6. Outline an ERP roadmap

An ERP roadmap ensures smooth implementation. Create one even before choosing an ERP software vendor. Your roadmap must include a well-defined set of business objectives. This is where you align all efforts to ensure success.

You must also clearly define the roles and responsibilities of all those involved in the implementation. Assign an internal project management team that can oversee the ERP deployment and ensure that everything is aligned with the set objectives.

Most importantly, your roadmap must identify milestones to monitor the progress of your ERP implementation. Include short-term milestones, comprehensive simulations, piloting, reviews, and other phases of the project.

7. Execute your plan with the right vendor

Once you have a plan in place, find an ERP vendor that can help execute your enterprise software strategy. Be very thorough in choosing your ERP vendor. They must have the expertise to provide software solutions and be reliable enough to provide you with long-term support.

Choose a vendor that has vast experience with ERP projects and can deliver the best software solutions for your business. Partner with a reputable software vendor that offers the deployment method you prefer, whether it’s cloud-based or on-site.

Avoid vendors that offer standardized solutions and those that have software limitations. Your ERP system should grow as your business grows. And your ERP vendor must be able to provide support through this growth as well.

Boost Growth with an ERP Strategy

Indeed, an enterprise resource planning system can take your business from good to great. However, you must have an efficient ERP strategy in place to ensure proper implementation of the software. A good strategic plan will reduce time and money wasted on a software solution that does not meet your business needs. It will ensure that your new ERP software will function well in your business environment. Ultimately, this would enhance your business processes and lead to better profitability.

Vignesh N