Focus on value and changeability
Being prepared for change is the greatest challenge when upgrading an ERP system
ERP systems today can do all sorts of interesting things.
They have become major systems that support thousands of processes. However, when users only need fifty processes, the rest of the processes becomes an obstacle, as the system is difficult to use. Implementing a new ERP system should be about change management and examining processes rather than making system customisations.
You probably know the feeling all too well: technology with a world of options you never use.
It is the process, not the system that creates value?
The point of this post is that ERP systems do not create value in and of themselves. The systems only create value by supporting value-adding processes for the users. It is therefore essential that you focus on the processes that a new ERP system has to support and ensure they actually create value in the value chain.
The challenge is, that we as humans often favour the technical capabilities “we have always had in the old system” instead of reviewing whether the process is due to the original capabilities in the system or the most efficient process – as well as whether the processes has changed.
Time and again we encounter customers who have customised their old systems in ways that do not create value today. And the faster the world changes, the harder it is to predict whether a process that has to be supported today will continue to add value in a year.
How can we know whether customisations will create value a year from now?
Today our customers do not want modifications made to their systems. In the past, customers paid for analytical processes to find out everything the system could do and how to customise it to fit their needs.
That is no longer the case. Today, customers ask how the system supports a particular process. Our customers generally only want to hear about the parts of the system that they need. They want to be able to talk about how their existing processes can be supported by the functionality provided.
So, whereas in the past we would conduct analyses, today we hold workshops with our customers.
Embrace the culture and be ready for change
The most important exercise for customers today is to be able to change their processes rapidly to meet market demand. Implementing a new ERP system should be about change management and examining processes rather than making system customisations.
Read more about this topic in the free book: The Profitable ERP Strategy
I have written a book with input for your ERP strategy, and you can read it for free.
It contains 7 recommendations for a healthy and changeable ERP system:
1. Consider a Cloud Strategy
2. Focus on value and readiness for change
3. Select “best practice” scalable standard functionality
4. Have a strategy for flexible management of master data
5. Select ongoing operating costs rather than large investments
6. Consider a strategy for upgrades where only relevant data is included
7. Select a needs-driven ERP strategy – perhaps with different platforms?