Elongating the life of your ERP
There are many practical ways you can extend the life of your ERP, and so save on the upheaval and the disruption that inevitably accompanies the move to an entirely new system. We have several blogs already describing some of our suggestions; ERP Optimisation, ERP Maintenance, Updating and Upgrading without utter disruption (*See below).
The maxim, “don’t throw the baby out with the bathwater” is particularly pertinent here as changing ERP is a radical move. Especially when what you are trying to achieve is to improve, flex, adapt and evolve, rather than be an agent of radical change.
The linchpin of elongating your ERP is the business process review which will provide an important thermometer on the business and if done regularly, the change reporting will be able to uncover where you can make changes to “improve, flex, adapt and evolve” the ERP to reflect the changing needs of the business.
A regular and thorough business process review is what we recommend; a full capacity planning and workload diagnostic as well as a detailed review to ensure that all elements of the system correctly support the business processes and that they are set up correctly and optimised. This will take you into every department and every nook and cranny to see where enhancements or customisation is required. It is this regular tweaking and modernisation that prevents a fundamental redesign and will elongate the lifespan.
ERP solutions themselves have undergone significant transformation over the last 20 years, where early systems were purchased and used for financial applications (accounting, order management and purchasing), today’s systems have a far broader use across the enterprise. Later systems include specialised applications for CRM (Customer relationship management), HCM (Human Capital Management) and PLM (product lifecycle management). In general ERP has grown from financials to incorporate business applications and as such they provide (and require) tailoring for each business.
This is both a curse and a blessing as out of the box may do 80% but to really gain the full benefit (and continue to extend its life), customisations and enhancements are a way of life for any fully featured ERP system.
We follow a proven methodology in our business process reviews, learned from years in the ERP space, to ensure we cover all the bases and use best practice throughout. In essence, we stick to some simple rules; we fix what is easy to fix first, we do what is less expensive if possible and we follow an iterative process of continuous improvement. Some of our principles are outlined below.
1. License Optimisation. This can be the simplest, most cost-effective fix as people who have left, still have a licence. Depending on the licensing model (concurrent or personal use), there is often a way to optimise by load monitoring.
2. Routine Maintenance. As it is likely that the system has been in place for some time, the maintenance becomes more cumbersome and the staff who originally dealt with this may have subsequently left. Maintenance by an external 3rd party is one of the simplest fixes (rather than hire internally); it’s becomes simply a pre-booked and budgeted calendar item.
3. Keep it Simple. Don’t fix what isn’t broken – some processes may seem simplistic but if they work, leave well alone. Broken processes and complexities riddle some companies so if you find something that works, document it.
4. Project Management. Internal management and ownership is the final mile of any system and will yield key productivity benefits. Proper management of internal resources, stakeholder and executive buy-in, proper internal communications of the project, assigning the right teams and system advocates all help take a project from good to great.
5. KPIs. Key performance indicators are a useful start-point for any project and can be used to measure change, so long as there is a marker in the sand from whence you started. Then you can measure the divergence, of an improvement – or not. So, if there are no KPI’s now is the time to set them, right at the start of the business process review. You don’t need to go “scorecard-tastic” but measure and document who uses what systems, for what purposes and to what end-goal. Then you will be able to measure who has seen an improvement – always a useful ROI tool.
6. Horses for Courses. In some instances, trying to fit every process into your core ERP just won’t work; it’s like trying to fit a round peg into a square hole and in some instances using an alternative solution for a specific challenge is a breath of fresh air. A POS system for tills, GPS system for fleet tracking, a mobile App designed for chat, a marketing automation for communications; whatever it is, there is no reason it can’t have touch points or even integration points via middleware into the ERP, (for instance Infor ION links disparate systems with LN or LX or other Infor ERPs). Although you don’t want a multiplicity of disparate systems, a monolithic approach can prevent innovation so should be avoided.
7. Business Intelligence. This is a classic example of getting the right horse to do the right job as business intelligence is an art unto itself. Adding more complex queries into your ERP may still not cut it, so consider one of the purpose-built BI tools.
8. Let’s get Visual. A picture speaks a thousand words so make the most of visualisation tools as your users will find these far more valuable than never-ending spreadsheets. In the business process review planning stage, use white boards, even stick-it notes and better yet some of the excellent new collaborative visualisation tools available today as it will help your team to see the big picture and where they fit. And alongside this provide your users with a documented template to which they can add their views and opinions. This will enable them to explain what processes they use, and which are most valuable and even enable greater visibility of the teams’ business goals. IT may also reveal what needs to change through the business process review and perhaps even help manage the workload for change. It will certainly help gain buy-in to the process of change which can in itself be a challenge.
9. User Improvements. Today’s ERP solutions will allow users personalised views with saved links and quick access short-cuts. Allowing the teams to document these and share can provide valuable insights into improvements which can be adopted across the business.
10. Data Management. This is one of the key reasons for having a regular business process review to ensure the continued integrity of your data. New business processes, (such as adding a picture of your receipts to expense requests), needs to be captured. In these circumstances the data input form can then be adapted to add the new fields. We could write a book on data management and cleansing, but suffice to say, a regular data check-up is like the dentist, (a necessity but not desirable). Using an independent 3rd party data expert is the swiftest way to remove that toothache. And it’s surprising to learn that some consultants really, genuinely love data projects!
11. Not invented here! Beware of this syndrome as it can seriously inhibit your ability to innovate and it happens throughout the IT industry, as IT departments re-invent the wheel each time rather than buy packaged solutions or 3rd party tools. Drilling down to define the needs in the business process review is essential to avoid mini developments on an ad hoc basis. Sometimes, upgrading your ERP system to the latest version with a bolt on approach and self-service options may cut the cost of support for the core system. However, this doesn’t mean adding multiple customisations, but adding specific solutions for specific tasks. Multiple instances of customisations will undoubtedly make you a slave to the consulting company. New functionality requirements need to be documented and included into the business process review to evaluate the ERP as “fit for purpose”. This review may result in the need to look at upgrades and updates or 3rd party tools. Indulging different footprints and multiple varied instances increases complexities and therefore the support costs.
Remember; ask not what you can do to the system, but what the system can do for your business.
The purpose of ERP is to alleviate and automate tasks in the business. The business process review evaluates how effective the system is and provides guidance on improvement. Structuring the business process review with a business process mapping tool can organise the process and even build out some of the tasks that your core ERP struggles to accommodate.
Throughout the business process review our methodology reminds us of the higher goals; efficiency, insight, control, accuracy, planning and optimising. This process provides a way to continuously improve and this enables a business to adapt to change and react to opportunities. The ERP and ancillary solutions are the tools and not the endgame and so best practice is to instigate a regular business process review, with mapping tools and an independent 3rd party to evaluate, re-evaluate and adopt a fluid approach to elongating the life, usefulness and benefits of your ERP core system.
For more information please see www.reinforcetech.co.uk
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