There’s more to growing a business than winning new customers and clients. To experience real growth, you need to optimize, streamline, and centralize your core business processes. Then you can get the full picture of your company’s operations.
For your salespeople and customer service reps to gain the insights they need, you may need to invest in a customer relationship management (CRM) solution. But what about all your processes that aren’t focused on sales? That’s where an enterprise resource planning (ERP) solution comes in.
ERP systems are designed to collect data from a wide variety of business processes, including HR, supply chains, manufacturing, procurement and billing. And they make that data more accessible and usable. In fact, a well-implemented ERP can empower its users to eliminate information silos, which will create comprehensive insights, analyses and reports. So it perfectly complements the sales-and-service focus of CRM.
If you’re thinking about adopting an ERP solution for your business, it’s important to understand some fundamental concepts before you invest your company’s time and money in it.
So here are 10 important tips about ERP implementation:
Optimize for higher productivity but lower risks.
A well-designed ERP platform allows for many of the most tedious and time-consuming daily activities (such as sending email updates, generating reports and identifying delays) to be fully automated. This benefit also creates an opportunity to reduce the guesswork and uncertainty of many business operations, which reduces the impact of human error.
Your top priority should involve improving insights and reports.
Since ERP solutions put a wealth of vital information at your fingertips, they make life easier for everyone who uses them. But to be truly effective, all of this data needs to flow to your company’s decision-makers. In other words, you need to invest in the development of useful dashboards, standard reports and in-depth analysis tools.
Focus on the ERP modules you actually need.
There is no one-size-fits-all approach to ERP implementation. Since most ERP software is modular, it gives thousands of possible configurations—right out of the box. Always remember that your ERP solution needs to align with your company’s specific use cases. Frequently, you’ll need to ignore the bells and whistles. To create a more streamlined ERP experience, you may even need to remove unused functionality.
Understand the types of ERP, as well as their use cases.
Does your ERP require full control over a dedicated, on-site server? And do you have a geographically distributed team that includes people working in the field? If so, cloud-based ERP might make more sense.
Identify the correct size of ERP for your business.
A small, family-owned company has vastly different ERP needs than a midsize international business. So if your ERP implementation partner doesn’t understand those differences, it can create a huge range of problems down the line.
Planning and preparation matter.
According to some estimates, 50% of new ERP implementations fail. And in almost every case, the root cause is a poorly planned, rushed roll-out process. So take your time, and get it right.
Create a realistic timeline.
ERP vendors can be optimistic to a fault. This trait is especially common when it comes to estimating the timeline of a successful roll out. These vendors tell their clients what they think they want to hear, even if it means fudging the launch dates. As a result, most ERP initiatives take 30% longer to complete than their original estimates. Overall, a good ERP implementation partner is completely transparent about the potential delays you may face along the way.
Set a realistic budget.
It’s extremely common for new ERP implementations to go way overbudget. This outcome is often the result of trying to cut corners on steps like user testing—only to realize late in the process (even after the launch) that an essential feature is missing. A great ERP implementation partner will be candid with you about the costs involved in achieving your company’s goals. This transparency will allow you to create an accurate budget from the get-go.
Find the right implementation partner.
When deciding whether to adopt an ERP solution, many companies focus on the wrong things. For example, they obsess over:
- The specific features of ERP software suites.
- The length of time the implementation will take.
- The amount of money they can shave off the final budget.
To keep your project on track, you need an implementation partner who’s willing to take the time to understand your company’s unique needs, challenges, and use cases.
Plan for post-implementation revisions.
Most new ERP systems require usability upgrades and improvements after implementation. These post-implementation upgrades should be an essential part of your ERP strategy. And your implementation partner should have a cost-effective plan that will continuously help you improve your results.
Your ERP solution is one of the most important investments your business will ever make. It’s a major expenditure of time, money, and other resources. So the last thing you want to see is your ERP implementation fail because of a completely avoidable problem.
Remember, the most important thing is to get it right, which could involve thinking bigger than just ERP. In many cases, it makes more sense to launch a combined ERP/CRM solution. When you combine your ERP and CRM installations, you’ll have complete visibility of every aspect of your company’s operations.