Anecdotally, you’ve probably heard an Enterprise Resource Planning (ERP) system can be a silver bullet. True…but only if you make the right choice. 

You also aren’t quite sure they are worth all the fuss. So you’re out seeking answers yourself. And we get it. 

Investing in any enterprise software isn’t a minor decision, especially when said software will be the focal point of your business operations.

Not to mention the stakeholders that may need convincing. You need to justify the amount required to adopt the software and the changes within the business that this new tech will demand. 

Although you’re curious, you don’t need a post that only spotlights the benefits of ERPs.

What will serve you just fine is a balanced presentation of the positives and negatives of ERPs so that you can decide if an ERP is suitable for you.

And this article is precisely that.

What Does ERP Stand For & What Is an ERP System?

ERP stands for enterprise resource planning. An enterprise resource planning system is an application that enables organizations to manage their day-to-day activities using several connected tools. 

Let’s unpack this.

Typically, businesses have core departments that keep them running:

• From accounting 
• To customer relationship management
• Inventory management
• And human resource management 

Several departments need to operate seamlessly for your business to function at the highest level as a well-oiled machine.

At its core, an ERP system helps you keep an eye on all these departments from one platform, get accurate data from their operations and automate specific processes. 

You can think of ERP systems as central command centers and data hubs for businesses.

With a well-deployed ERP software, departments can access the data they need from other sections of your business anytime from a centralized database.

This eliminates tedious paperwork, repetitive data entry, and even crippling bureaucracy. 

Instead, it facilitates swift collaboration and data sharing between departments, more accurate resource and operation planning and forecasting, and greater efficiency.

If you’re wondering how ERPs function, here’s a simple explanation without delving into the core mechanics.

Since ERPs are designed to help manage different business operations, they include modules dedicated to each business aspect.

For example, you’d have a financial management module, supply chain management module, etc.

The individual modules not only coordinate their corresponding business sector but also communicate with each other and send data to a single platform. 

Standard ERP modules include:

• Supply chain management 
• Inventory management
• Financial management and accounting
• Customer relationship management
• Manufacturing
• Human resources management
• Professional services automation
• Reporting and analytics

The Evolution of ERPs

Although ERPs are now available to companies across several industries, their functionalities weren’t this broad. 

ERPs slowly crept onto the scene in the 1960s as material requirements planning (MRP) systems.

Around this time, J.I. Case, a tractor manufacturer, partnered with IBM to develop what industry commentators widely regard as the first MRP system.

This paved the way for more manufacturers to build similar MRP solutions.

The key functionalities of early ERPs served manufacturing companies majorly.

They helped them track inventory and production and manage raw materials, among other things. But these MRPs were expensive, bulky, and required expert technicians to manage them.

By the ‘80s, when MRPs had become mainstream, the technology powering them improved with the introduction of MRP II.

These new systems had more extensive functionalities that catered to operations beyond inventory and raw materials management.

The core functionalities of the MRP were primarily focused on manufacturing businesses but now enabled these organizations to connect and manage the critical departments involved in manufacturing.

As more industries realized the potential of MRPs, more comprehensive solutions began to crop up.

Gartner coined the term for the emerging solutions, “enterprise resource planning,” in 1990, leading to the creation of ERPs.

Businesses of all sizes and industries could sync and access data and manage operations from one platform.

Beyond the broadening of the features offered, ERPs have also seen an evolution of their deployment options.

From being strictly on-premises systems, leading ERP manufacturers began offering cloud solutions.

These options enabled companies to access data and perform select operations on any internet-enabled device anywhere and anytime. 

Not only did cloud-based ERPs improve the efficiency of business teams, but they also paved the way for smaller companies without the resources to host on-premises systems to leverage cloud-hosted ERPs for business growth.  

Beyond more nimble deployment options, modern ERPs are now applying the latest technologies to deliver better experiences.

They use artificial intelligence and machine learning to provide smarter business insights, intelligent predictions, analysis, high-end process automation, etc. 

Plus, many of these ERPs can connect businesses with their subsidiaries and partners around the globe for better coordination and management.

Main Benefits of ERPs in Organizations

By taking even a cursory glance at the capabilities of ERPs, it’s easy to see how they can help businesses thrive and perform optimally. But let’s take an in-depth look at some of these benefits.

1. Serves as a One-stop Shop for Reliable Data Across the Organization

Data is one of the most invaluable assets that businesses can leverage.

It gives insights into the current state of things, offers glimpses of what the future holds, and informs decisions that will help create or avert that future. 

With ERPs, you get access to critical insights from various business segments, all in one place.

This removes the need to use separate databases that will require constant synchronization and cleaning to ensure accuracy.

Plus, this also provides you with both an overview and a microscopic view of critical business data across the board needed to plan processes, allocate resources and make adjustments intelligently.

For example, it becomes easier for you to maximize available resources by deploying to areas where there will yield the most results.

This centralized database also profits decision-makers at the departmental levels and fosters faster and easier collaboration between departments. 

2. Boosts Productivity and Efficiency

Getting the most from the resources at your disposal is vital if your business will thrive.

An ERP system helps with this by automating simple repetitive tasks and freeing up employees to focus on more dynamic activities that are also mission-critical.

This way, you’ll have your employees using their time in the best way possible, and all this adds up to greater output for the business.

An ERP’s automation capabilities also ensure you don’t overlook essential steps in specific business processes.

The system adheres to the workflows once you set the workflows, so nothing slips through the cracks. You cut down on execution errors and can seamlessly and consistently adhere to regulatory demands and industry standards.

And with superior computing, ERPs drive faster execution and provide intelligent and reliable recommendations that can speed up decision-making and improve efficiency. 

3. Delivers Comprehensive Reports and Analytics

Apart from giving you access to raw operational data across the organization, modern ERP systems can generate standard and custom reports and analytics on demand. 

You often require high-level reporting for purposes ranging from in-house record-keeping and decision-making.

Such reporting may demand that you compare data from different departments or use planning models like scenario forecasting. 

These complex and otherwise tedious processes are simplified with model ERPs, and reliable results are available through button clicks.

Depending on your chosen solution, your ERP’s reports and analytics section may even be the only reporting tool you’ll need for your business, as many can communicate the trends and metrics required for high-level reporting and decision-making.

4. Bolsters Collaboration 

Departments across your organization need to be in sync to drive the business forward.

For them, being on the same page concerning the company’s goals is one thing. Being able to work together to achieve them effectively is another.

Although this collaboration process should be seamless, an absence of a hub that connects all the departments prevents this. But an ERP solves that problem.

One of the most significant benefits of an ERP system is its ability to level the walls between departments through seamless data sharing.

By creating a centralized database, departments can access relevant data from other sectors on demand and execute based on the insights gleaned. 

Progress reports that inform the company’s next moves are also readily available. So each sector within the organization knows exactly when to step in without dealing with the monotony of manually demanding updates from other departments.

As such, decision-making can be more proactive, timely, and effective. 

5. Standardizes Business Operations and Ensures Regulatory Compliance

It’s not enough to know how to satisfy your customers. You also have to weave in standard industry hacks and strategies into your processes to stay competitive.

An ERP system is the best tool for organizing these strategies and embedding them in your operation. 

ERPs enable you to create and manage custom workflows that reflect industry best practices.

Some industry-specific ERPs even come with these optimized workflows, which you can simply start implementing. Such processes also foster top-notch quality control as they are structured to deliver consistent results.

Beyond facilitating industry best practices, ERPs enable your business to comply with standard stipulations and requirements efficiently.

For instance, many come with built-in financial functionalities and reports that comply with tax laws and various financial reporting standards.

This way, you can deliver automated reports knowing that you’re in full compliance, avoid legal infringements, and save time that goes into repetitive bookkeeping and accounts balancing, tax remittance and reporting, etc.

6. Improves Customer Service and Interactions

Satisfying and retaining your customers requires you to be on top of your game.

The sales department, for example, needs to be able to effectively manage and use customer information to deliver the best experience.

And a modern ERP system can facilitate this process by centralizing and streamlining accurate customer information with other business data. Plus, it provides a central database that makes customer information readily available to whatever department needs it.

This creates an agile work environment where the absence of restrictive silos improves service delivery to customers.  

Using an ERP to track and manage customer activity can also power effective marketing campaigns.

From creating automated lead qualification metrics to setting upselling and cross-selling parameters, several modern ERPs better empower marketing and sales teams to take advantage of sales opportunities.  

Disadvantages of ERPs

Seeing all the advantages of ERPs might make installing one for your business seems like a no-brainer. But we all know it’s not that simple.

The essence of good decisions is in weighing the pros and cons of your choices and seeing which tips the scales based on your needs and context.

We’ve seen the positives of ERPs, so let’s see some of their major drawbacks you should be aware of.

1. Cost

Installing ERP software doesn’t come cheap.

Traditional ERPs that require on-premises deployment attract various expenses ranging from the upfront cost of the software to installation and maintenance fees and the cost of upgrading your hardware where applicable.

Businesses just starting may find all this too pricey.

Although opting for solutions that offer software as a service and require monthly or annual subscription fees may be cheaper in the short term, the long-term cost may be daunting. Plus, you may find hidden charges creeping in along the line, such as payments for the quality support, training, etc.

An ERP system is definitely worth its weight in gold. But it’s possible that forking out a hefty sum for one would do more harm than good to your business, depending on your situation.

2. Complexity and Training Requirements

As you’d expect with anything that offers the functionalities that ERPs do, complexity might be an issue.

Even though several solutions claim to be intuitive, they are still head-scratchers for users (especially first-timers). This means a tool you chose to simplify and streamline your operations may create confusion.

The solution? Training, but this also comes with its hitches.

Differing learning capabilities among employees might create an uneven understanding of the platform, which could slow down business operations and defeat the reason you got the system in the first place.

3. Implementation Time

There’s no standard timeline for deploying your ERP as the implementation duration varies based on company size, software complexity, and more.

That said, this process can take anywhere from six months to two years. You read that right. 

Although cloud-based ERPs are faster to deploy, setting them up also takes time.

There’s also the time it takes to customize the system to suit your business. This is important if you’re getting a generic system and prefer to modify it to your taste. 

So you have to approach this with the knowledge that what you’ve invested a ton of cash in may not begin to function in months.

These ERP Advantages Could Be Too Good to Pass Up

Research processes like this usually end in two ways: you come in as a skeptic and leave as a believer. Or you arrive as a skeptic and leave as an ardent unbeliever.

Either way, something has happened here – you’ve broadened your understanding of the value and drawbacks of ERPs.

But before you make a decision, reflect on these advantages and disadvantages in the context of your business.

For you, having a centralized database or one source of truth for your records may just be worth shelling out decent cash for. 

Getting better visibility into your business processes and improving efficiency by automating manual tasks may just be worth the time it takes to implement the system. 

The point is, no one knows your business like you.

And all the benefits ERPs bring might just be what your business needs to get to that next level. If you see any or all of these signs, we recommend that you consider adopting an ERP system:

• Poor decision-making due to insufficient internal data
• Relevant data and reports aren’t available on demand and take too long to compile 
• Overworked teams that are spread too thin by repetitive tasks that can be automated
• Constant technical issues from disparate systems
• Customer service issues due to inaccurate data like inventory numbers.

Apart from negative signs, positive events can also make adopting an ERP system critical.

For instance, if your business is growing rapidly, you may not be able to keep up using manual methods or separate systems. Plus, an ERP might be well placed to help you scale even faster.

Also, you should know that the highlighted drawbacks vary in intensity based on the ERP solution you opt for. Top players in the industry, such as NetSuite ERP, typically come with milder hiccups.

The post What Does ERP Stand For and What Is an ERP System? All You Need To Know appeared first on ERP Software Hub.

Are the benefits of ERP worth the switch?

Maybe you’ve started to notice the company is growing and products are selling…

…so the current systems you use are starting to lag behind, slowing down productivity.

So now it’s time to determine whether to leap to ERP software.

It’s a big decision that can lead to either supercharged growth or disastrous consequences. 

Read on to learn more about the advantages and disadvantages of ERP.

What Is an ERP System?

Enterprise Resource Planning (ERP) is a specific type of software that combines the main business functions into one system.

These functions may include operational activities such as inventory management, accounting, human resources, or e-commerce.

Integrating an ERP system means you are switching your business management processes to something else entirely.

As you can imagine, this integration will take up company time, money, and resources to fully implement.

The 10 Game-Changing Benefits of ERP Systems

1. Unify Disjointed Systems in a Business

Before smartphones, going on a road trip wasn’t as easy as it is now.

You couldn’t put an address into Google Maps and drive off. You had to print directions from Mapquest or even buy an Atlas. 

You’d have to wait for the radio to play your favorite song or bring a walkman with you.

Wondering how much this trip will cost you? Don’t forget to bring a calculator.

Good thing we don’t need to deal with that anymore. We now have maps, the radio, and a calculator all on one handy palm-sized device.

Just like our phones, the benefits of ERP include combining separate entities all into one.

Some advantages of ERP software include:

• Easier access to information
• Improved efficiency
• Fewer communication breakdowns

2. Transform Outdated Legacy Systems

Maybe, in the beginning, Excel successfully managed your inventory. But now the manufacturing team and available products have grown, yet you’re still using Excel.

Or maybe HR manually inputs employees’ hours from a system not connected to payroll — wasting hours of your day.

You get “used to” your current manual processes and just do it the way it has always been done. 

The issue is once you get used to it, it’s easy to get complacent.

ERP software updates these old systems so it’s no longer so manually driven.

3. Enhance Operational Productivity

Most ERP vendors advertise efficiency.

In fact, out of businesses that incorporated ERP software, 95% of respondents improved some or all of their business processes.

That’s pretty major.

The reason?

Because you’re not wasting time having to learn multiple systems or opening two different programs to check something. ERP also improves cash flow, resulting in more money.

Everyone likes getting their money quicker.

4. Scales With Your Business

Switching to an ERP system isn’t easy. After all, over 60% of ERP integrations fail.

So why do companies continue to take the risk?

It is because decision-makers have a growth mindset: 

They know how well ERP systems scale with a growing business.

Simply put, most ERP software offers modules specific to your business needs and the ability to add functions as the company grows.

This flexibility is advantageous regardless of whether you have 2,000 or 20,000 employees.

You don’t need to frequently accommodate ever-changing business needs. If implemented correctly, the benefits of ERP software can’t be understated.

5. Make Informed Decisions With Less Human Error

Technology and trends are constantly changing — it’s bad news if your company can’t keep up.

Since business decisions must be made quickly (and accurately), you need access to the most up-to-date data and analytics.

If you find yourself wasting hours or days manually creating reports, then it might be an indicator to switch to an ERP system.

Plus, manually inputting data into a report can’t be done mistake-free, 100% of the time.

We ARE all human.

But since ERP software pulls the data automatically, it greatly reduces the chances of errors.

It would be devastating to create a costly business decision based on inaccurate data.

6. Ensure Security and Regulatory Compliance

Maintaining data security is of utmost importance to companies. 

If there is a data breach, you’re not only dealing with the aftermath’s logistical nightmare, but also the betrayed trust of customers and clients.

With the nature of business functions, ERP systems contain large amounts of sensitive data. That sensitive data shouldn’t get stored in a spreadsheet in someone’s unlocked folder.

Benefits of ERP software in managing security include:

• Data backups and encryption
• Access is granted depending on the job function
• Continual audits for access necessity
• Transparency in tracking products

7. Advanced Management of Supply Chain and Inventory

Supply chain issues often result in a costly halt to business operations.

Maybe the manufacturer is short-staffed or the last piece of equipment you need is backlogged. Or you simply have too many buyers (nice) but didn’t project enough for it.

A major advantage of ERP is the variety of modules and tools that standardize keeping track of all the moving parts of the supply chain.

Since ERP systems can also be set up specifically to automate inventory management and projection, it reduces the time-consuming need to do these manually. 

8. Reduce Miscommunications Between Departments

Imagine you’re getting ready to present last quarter’s sales numbers.

But there’s an issue.

You find out that this important quarterly report is attached to an email sent to someone who is currently on vacation. And the person who made the report no longer works at the company.

Although unlikely (who doesn’t CC everyone?) it doesn’t negate the fact that situations like this are possible.

These scenarios are the exact situation that ERP software helps to avoid. 

There is a reason why one of the top benefits of ERP software includes increased collaboration (reduced process time and centralized data are the others).

Seemingly small communication breakdowns can lead to tension that creates large-scale employee dissatisfaction.

9. Larger ROI and Happier Customers

No customer wants to feel like just another number.

As a business, you want to make the barrier to entry easy so you can turn potential customers into lifelong fans.

To accomplish this, companies often use ERP software as a CRM (Customer Relationship Management) tool.

In fact, according to Nucleus Research, incorporating a CRM provides companies with an average ROI of $8.71 per dollar spent.

CRM allows businesses to automate marketing and sales, follow the customer through their buying cycle, and provide personalized offers.

Plus, ERP systems offer solutions that contribute to the customer experience regardless of behind-the-scenes disruptions.

It is a powerful tool for any growing business.

10. Put Repetitive Functions on Autopilot

Manual processes are slow and cumbersome.

The only thing worse than manually doing something is having to do it twice. it. Every. Single. Time.

Automation is one of the biggest advantages of ERP specifically because it helps efficiency.

If one employee needs data manually inputted by another, then productivity is wasted for everyone.

Most ERP solutions automate and create real-time data, negating the necessity of manually transferring data.

The 6 Main Disadvantages of ERPs

1. You’ll Pay (Literally) If You Don’t Know What You Want

Two companies can use the same ERP software for completely different reasons. 

It’s like car shopping: all cars get you from point A to B but the ride differs depending on taste.

After all, you don’t purchase a new car without a few preferences in mind. Similarly, you wouldn’t get ERP software without knowing how it helps your business.

Going in without a plan all but guarantees an implementation failure.

Too many companies think that an ERP will fix all their system issues.

But time and effort are required to ensure the ERP software fits your needs. 

This might mean scheduling multiple meetings with departments so everyone is clear. This may require back and forth and discussion with multiple sales reps.

But going through and doing your due diligence on this will make the ERP integration much smoother.

2. ERP Implementation Is Notorious for Going Over Budget

Compared to the other disadvantages of ERP, price is a huge consideration.

The sticker price of ERP is already expensive but most companies aren’t fully prepared for just how expensive integration truly is.

No matter how thorough you budget for ERP integration, it is common to go over that budget.

Be prepared because you do NOT want to be one of the companies that spent millions of dollars on a failed integration.

3. Expect to Plan Around the ERP Software

If you are thinking about switching to an ERP, I wouldn’t get too attached to your current system.

Too many businesses try to force ERP features to fit with the current system instead of the other way around. 

In other words, implementation will be easier for everyone if you assess the good parts of your current system and determine if it’s able to integrate with the ERP.

Although it may sound counter-intuitive, ERP is designed with efficiency in mind. The software knows what it does well and already has a proven method in how it helps your business.

4. Implementation Takes Longer Than You Think

ERP implementation is not known for being quick and painless.

Actually quite the opposite.

A major disadvantage presents in the beginning: getting a company’s new ERP up and running.

The issue with slow implementation is how it affects doing required daily tasks.

Systems might frequently need updating or have downtime, causing frustration for the employee who has an upcoming product deadline.

As a company, you’ll need to be prepared that this frustration may drag on for months.

5. Requires Managers to Buy-in

Integrating ERP software ends up being a total revamp to your current system.

This is not something an IT person should decide on for the whole company.

To do this successfully, all departments must be willing to participate. 

Changing processes requires upper management to instigate the change. They are the ones who share insight with the employees that the growing pains will ultimately be beneficial.

If not everyone is on board, it can lead to increased turnover out of frustration.

6. Still Requires Human Interpretation

Many businesses add ERP software to have all their data in one system to make it easier to make future decisions based on the data.

Not a bad idea, right?

The issue is that the data is there but it still requires a human to interpret it.

You must ensure the quality of the data doesn’t become lax, otherwise poor decisions might be made that negatively hurt the future of the business. 

And this would not be the ERP system’s fault.

How to Decide if an ERP System Is Right for Your Business

There are a few major areas you’ll need clear answers on before switching:

• Business need: What specific functions will the ERP software accomplish? Is your industry a common area that uses ERP?
• Budget: Do you have the resources available for a long implementation process? Do you have the money available to account for going over the initial budget? Are you willing to go over budget?
• Company size: Is the company growing or do you have a manageable number of employees? Will a smaller, simpler upgrade work instead?
• Employee willingness: Are current employees willing to change their current processes and adjust to new ones? Or will they try to work their manual processes in, therefore reducing ROI?
• Integrating team: Do you have a consultant, firm, or in-house team to assist with integration? Who will provide ongoing support during updates or errors?

Do You Find the Benefits of ERP Worth It?

After weighing the pros and cons of ERP, you should have a better understanding of whether ERP software is right for you.

So, is it time for your company to switch?

If yes, congratulations! Make sure you get fully prepared by reading our ERP implementation guide before getting started.

If not, that’s reasonable too. There’s no need to rush the process. 

You can implement ERP when you’re ready.

The post Benefits of ERP: Advantages and Disadvantages to Consider appeared first on ERP Software Hub.

It can save countless hours by automating manual processes for your team. It can show you exactly where your money is going. It can simplify approvals for purchase orders, invoices, expense reports, journal entries order management, and so much more.

But implementing it properly? That’s a whole other story.

There’s a reason why 60% of ERP implementations fail. And even if they don’t fail, so many organizations run into problems in implementing erp systems. It’s hard to do well. 

All too often, when companies don’t have a good ERP implementation process to follow, they’ll accidentally go over budget – or miss timelines and suffer massive delays. 

And even though it’s typically the implementer’s fault for not giving you a good plan, you have to bear the brunt of the consequences when it comes time to tell your boss. It’s enough to keep you awake at night.

We want to save you the trouble and anxiety.

And that’s exactly what we hope to do by revealing our proven ERP implementation process.

What Is an ERP Implementation?

Before we dive in, it’s critical that we’re on the same page when it comes to what an ERP implementation actually is.

An ERP implementation is simply the planning, configuring, and deploying of an ERP in a business. 

ERP systems (Enterprise Resource Planning) help to integrate critical business functions—ranging from finance to manufacturing.

Implementation of these systems can take months and cost tens to hundreds of thousands of dollars. That’s why it’s so critical to do it right.

The 7 ERP Implementation Phases

Phase 1. Discovery

Here, you determine all the needs and requirements you have for your ERP system. Think of it as finding your organization’s “why” behind looking for a new system in the first place.

In order to succeed, you need to figure out what your system needs to be able to do to satisfy both users (your employees) and your business goals. This requires you to talk to everyone in your organization, hear their needs, and work with your implementation partner to discover what kind of solution you could build.

Phase 2. Strategy

You’ll have to decide on your implementation strategy based on your resources and long-term goals for your organization. You can tailor this for your unique needs. 

The “big bang” strategy means that you will replace your legacy system with an ERP all at once, in a single phase. A “phased” approach is where your ERP modules are introduced in a planned sequence. 

Consider which is best for your organization based on the findings from Phase 1.

Phase 3. Installation

This is where the implementation actually begins. The first version of your system is built based on the insights you learned from the discovery phase. Migration from a legacy ERP usually happens here (if applicable) to make sure all your data is moved over.

Phase 4. Testing

The 1st version of your system becomes the 2nd…then the 3rd…then…the 20th.

The team in charge of your ERP implementation starts looking for weaknesses and broken features. They test and iterate over and over again until the system starts doing what everyone wants it to do.

Phase 5. Training

All the key stakeholders and users need proper training before your new system is implemented. 

They don’t have to know the in’s-and-out’s of every single feature–they just need foundational knowledge so they know how they can use the system to improve their work.

Phase 6. Implementation

This is where the new ERP is actually deployed. After rigorous testing and training, your system is pushed into a live production environment and is ready for use. It’s critical to inform everyone on your team about when this is going to happen.

Phase 7. Post Deployment Support

As your organization begins using the new system, you’ll almost certainly come across minor glitches or ideas for new, helpful features. 

That’s why it’s critical to have a plan in place for having the support resources available well after your ERP implementation is actually done.

6 ERP Implementation Best Practices to Keep in Mind

1. Define what the “win” looks like, beforehand.

We can’t overstate the importance of a clear vision at the beginning. From the get-go, you need to decide how your organization will define the success of this implementation.

Otherwise, you won’t be measuring the right things – and later on, you’ll have a much harder time convincing your boss that this was a good investment.

So decide on the results you want, and then record a starting point you can measure against. You want before/after metrics to see the improvement. If the project goes really well, you want to be able to show everyone why.

2. Demand careful project management – on both sides.

Your ERP implementer should provide you with careful, detail-oriented project management. And you should provide your own project manager to communicate regularly with this person.

Why is this so critical?

Because you need traceability and accountability. So many people have a hand in what’s going on. And someone needs to make sure the mountain of to-dos are all being done on time.

Yes, it’s tempting to overlook this. Yes, it’s an extra cost. But 3 years down the road, you’re not going to remember the great reason why you set up a certain thing a certain way. But if you have a project manager creating documentation, you’ll never forget the details of your new money-saving systems.

So, have a detailed plan in place, where everyone knows who’s responsible for what. Track your discovery calls. Track your requirements. Record what you’re doing about them. You’ll thank yourself later.

One final note: Project managers should also be “change managers.” We’ve noticed these implementations go much smoother – with much greater buy-in – when there’s a champion on the inside, getting people excited about the change. 

Task your project manager with finding a way to reward and excite people – and you’ll likely be pleased with the results.

3. Start learning your system beforehand, to help your implementer build the best solution for your organization.

Your ERP implementer doesn’t have the level of information you have about your organization. Therefore, the more you know about the amazing things a platform like NetSuite can do, the better your organization can use all the amazing functionality of your new system to its full potential. 

It helps when you can ask things like, “We’ve got people manually enforcing expense reports in X way. How can our ERP help us automate this?”

NetSuite, in particular, has a bunch of small training videos that you can start with, to help grow your understanding. Spend a couple of hours a week taking courses.

This will help you identify and call out things you wouldn’t have otherwise seen in the initial implementation vision meetings.

Learning the platform you’ll use beforehand can help your organization end up in a much different spot by the end. You can squeeze so much more out of your ERP system when you have more knowledge of what’s possible – and your organization will likely thank you for it later.

4. Secure buy-in from your leadership team.

Buy-in starts from the top. One of the biggest landmines of a failed ERP implementation is lacking support from your leadership team. If you can’t secure 100% buy-in, you won’t have the resources you need to move forward. 

So how do you end up with the backing of your leaders? 

Start with making your vision of the ERP implementation crystal clear. Paint a picture of the benefits the solution will bring. Hiring someone full time will be necessary to track project success. 

Yes, it’s a large investment upfront, and that can be jarring. But make the end results clear. Saving time, streamlining processes, and cutting costs is a dream for the bottom line. 

Convince your leadership team that this project can’t be an afterthought. Without their backing, a successful implementation can’t be attainable. 

5. Provide your team with an exciting change management plan. 

Changing the way things have always been can be painful. Teams may not be 100% on board initially. Especially if it means they are being taken away from their current role and having extra work thrown onto their plate. 

This is your opportunity to align and train your team, articulate your vision for success and show how the ERP implementation can ultimately make everyone’s jobs – and lives – a lot better. 

How can you make an ERP implementation more fun? 

Promote the ERP implementation using creative taglines, mascots, or friendly team competitions to create excitement. It doesn’t all have to be by the book. 

What is the best way to keep the project on course? 

Project management is a crucial step in making sure everyone is on the same page. While comprehensive project management is typically provided by your ERP implementation team at Crowe, it is crucial to have a detail-oriented project manager from your team that will be responsible for oversight on training and regular communication to make sure all needs are met. 

It’s best for your project manager to also act as a “change manager,” championing the ERP implementation from the inside and inspiring excitement within your team.

6. Trust your consultants – lean into native functionality first.  

Every business is different. As technology consultants, we understand that. It’s natural to want an ERP system that is tailored to your business and ONLY your business. 

But let’s go back to the basics. Times have changed and ERP systems are made to simplify your business. Certain native functionalities (which are already built into a platform like NetSuite) work for the majority of businesses – and you’ll spin your wheels if you try to “over-customize.” 

Going simple can make your processes so much easier than they were before. 

We know there isn’t a “one size fits all” solution for every problem – and we’ll help you customize your system where it’s needed – but trust us when we say that adopting the standard processes of your system first can help your ERP implementation stay on track from the very beginning. 

Follow This ERP Implementation Plan to Solidify a Smooth Implementation Process

Change can be uncomfortable, but imagine the time and money you can save with a successful ERP implementation. 

If your whole team makes a commitment to move forward together, leaving clunky manual processes in the past, your organization can transform for the better.  

With hundreds of successful ERP implementations under our belts, we’re happy to lead the way and help you champion these three strategies for an ERP implementation process that leaves your team feeling empowered and in control – not stressed. 

The post ERP Implementation Plan: A Proven 7-Step Process appeared first on ERP Software Hub.

And that scares you because you’ve heard so many horror stories of ERP implementations gone wrong. 

Budgets burned through…

Deadlines missed by a country mile…

And finished implementations not doing what they’re supposed to…

How are you supposed to know if you’ll end up just like those poor souls if you move forward with an implementation?

Tens of thousands of dollars and 12 months later, you could be standing in a pile of rubble just like the other unfortunate people who embarked on a journey to implement an ERP system.

These are all very possible outcomes.

In fact, according to ERPFocus, 60% of ERP implementations fail. 

And even if yours lands in the elusive 40% of “successful” implementations, the odds still aren’t in your favor.

ERPFocus also reports:

• 80% of customers are unhappy with their ERP implementation
• 57% of ERP implementations take longer than expected
• 54% of ERP implementations go over budget

Yikes…

Those kinds of stats make most people run for the hills. 

But here’s why you shouldn’t:

In nearly every case, these horrible things happen due to a lack of proper planning.

With a rock-solid plan in place, your odds of a successful NetSuite implementation shoot through the roof. 

And in this article, we’ll give you a proven plan that’s been used in 100s of successful implementations so you can transform your business with NetSuite.

The 7 Main Phases in the NetSuite ERP Implementation Process

The very first thing you need to do is familiarize yourself with the general steps in the implementation process.

You don’t have to know exactly what you’ll do in each step at this point—you just need to be aware of the major milestones on your journey.

If you aren’t, your NetSuite implementation will go off the rails quickly.

Phase 1. Discovery

Here, you determine all the needs and requirements you have for your ERP system. Think of it as finding your organization’s “why” behind looking for a new system in the first place.

In order to succeed, you need to figure out what your system needs to be able to do to satisfy both users (your employees) and your business goals.

Phase 2. Strategy

You’ll have to decide on your implementation strategy based on your resources and long-term goals for your organization. You can tailor this for your unique needs. 

The “big bang” strategy means that you will replace your legacy system with an ERP all at once, in a single phase. A “phased” approach is where your ERP modules are introduced in a planned sequence. 

Consider which is best for your organization based on the findings from Phase 1.

Phase 3. Installation

This is where the implementation actually begins. The first version of your system is built based on the insights you learned from the discovery phase. Migration from a legacy ERP usually happens here (if applicable) to make sure all your data is moved over.

Phase 4. Testing

The 1st version of your system becomes the 2nd…then the 3rd…then…the 20th.

The team in charge of your NetSuite implementation starts looking for weaknesses and broken features. They test and iterate over and over again until the system starts doing what everyone wants it to do.

Phase 5. Training

All the key stakeholders and users need proper training before your new system is implemented. 

They don’t have to know the in’s-and-out’s of every single feature–they just need foundational knowledge so they know how they can use the system to improve their work.

Phase 6. Implementation

This is where the new ERP is actually deployed. After rigorous testing and training, your system is pushed into a live production environment and is ready for use. It’s critical to inform everyone on your team about when this is going to happen.

Phase 7. Post Deployment Support

As your organization begins using the new system, you’ll almost certainly come across minor glitches or ideas for new, helpful features. 

That’s why it’s critical to have a plan in place for having the support resources available well after your NetSuite implementation is actually done.

The Proven NetSuite Implementation Checklist: What You Need to Do to Succeed

1. Define what the “win” looks like, beforehand.

We can’t overstate the importance of a clear vision at the beginning. From the get-go, you need to decide how your organization will define the success of this implementation.

Otherwise, you won’t be measuring the right things – and later on, you’ll have a much harder time convincing your boss that this was a good investment.

So decide on the results you want, and then record a starting point you can measure against. You want before/after metrics to see the improvement. If the project goes really well, you want to be able to show everyone why.

2. Secure buy-in from your leadership team.

Buy-in starts from the top. One of the biggest landmines of a failed ERP implementation is lacking support from your leadership team. If you can’t secure 100% buy-in, you won’t have the resources you need to move forward. 

So how do you end up with the backing of your leaders? 

Start with making your vision of the ERP implementation crystal clear. Paint a picture of the benefits the solution will bring. Hiring someone full-time will be necessary to track project success. 

Yes, it’s a large investment up front, and that can be jarring. But make the end results clear. Saving time, streamlining processes, and cutting costs is a dream for the bottom line. 

Convince your leadership team that this project can’t be an afterthought. Without their backing, a successful implementation can’t be attainable. 

3. Determine budgets, needs, and timelines.

Budgets

NetSuite isn’t cheap and large IT projects are notorious for running over budget.

Make sure you create a budget that has contingencies to cover increased staff, hardware, or development costs.

Keep reading for more specific information on how much you should budget for your project.

Needs

It’s critical to know exactly what you want the ERP system to do before you begin implementation.

Ask questions like:

• Do we need any custom integrations or functionalities?
• Are certain departments or teams requesting certain features?
• Are there any specific pain points NetSuite could solve for us that we haven’t thought of?

The more information you have, the better and faster your implementation will be.

Timelines

Create a project timeline with buffers built-in because, you guessed it, large IT projects are also notorious for taking longer than expected. 

The specific amount of time you should plan for depends on the scale of your implementation, but we’ll give you an idea of how long yours might take in a minute.

4. Identify the right implementation partner.

Your main goal should be to get the most return on investment out of your NetSuite implementation. Sometimes they can take months, or even years, to complete. 

With industry-specific knowledge and experience, a great team can help you save time and money on your project – which you may be losing out otherwise due to lack of exposure. 

These are some of the boxes you should check before choosing a team: 

• Do they have certifications and good references? 
• What is their plan for post-implementation training and support?
• Can they provide customization? 
• How many NetSuite implementations have they completed?
• Can they provide a list of resources and coordination members who will be working on your project?
• Will they sign or provide a statement of designated responsibilities?

5. Create a change management plan. 

Changing the way things have always been can be painful. Teams may not be 100% on board initially. Especially if it means they are being taken away from their current role and having extra work thrown onto their plate. 

This is your opportunity to align and train your team, articulate your vision for success and show how the ERP implementation can ultimately make everyone’s jobs – and lives – a lot better.

6. Trust your consultants – lean into native functionality first.  

Every business is different. As technology consultants, we understand that. It’s natural to want an ERP system that is tailored to your business and ONLY your business. 

But let’s go back to the basics. Times have changed and ERP systems are made to simplify your business. Certain native functionalities (which are already built into NetSuite) work for the majority of businesses – and you’ll spin your wheels if you try to “over-customize.” 

Going simple can make your processes so much easier than they were before. 

We know there isn’t a “one size fits all” solution for every problem – and we’ll help you customize your system where it’s needed – but trust us when we say that adopting the standard processes of your system first can help your ERP implementation stay on track from the very beginning.  

How can you make an ERP implementation more fun? 

Promote the ERP implementation using creative taglines, mascots, or friendly team competitions to create excitement. It doesn’t all have to be by the book. 

What is the best way to keep the project on course? 

Project management is a crucial step in making sure everyone is on the same page. While comprehensive project management is typically provided by your ERP implementation team at Crowe, it is crucial to have a detail-oriented project manager from your team that will be responsible for oversight on training and regular communication to make sure all needs are met. 

It’s best for your project manager to also act as a “change manager,” championing the ERP implementation from the inside and inspiring excitement within your team.

FAQs About NetSuite Implementations

1. How long do NetSuite implementations take?

Most NetSuite implementations take a minimum of 3 months. More complex ones, though, can take 6-12 months.

This all depends on your organization’s needs in terms of

• Users
• Locations
• Integrations
• Customizations
• Currencies
• Subsidiaries 
• Data migration
• And more

2. How much do NetSuite ERP implementations cost?

A small business may be looking at anywhere from $40K to $75K for their NetSuite ERP. A medium to larger-sized business could range from $75K to $250K. 

Several factors contribute to your NetSuite implementation cost including: 

• Number of user licenses 
• Duration of the project 
• Cost of base editions 
• Scope of the project 
• Additional cost of NetSuite implementation services and license 

Because NetSuite is a cloud-based service, you can subscribe yearly.

3. What are the main reasons implementations fail?

1. Leadership doesn’t buy in.

Nothing derails a NetSuite implementation faster than leadership not being 100% bought-in to the direction. Make sure your leadership team knows exactly what this implementation will do and look like.

2. Incompatible implementation partners.

Choosing the right implementation partner is absolutely critical to your success. You need to make sure you find a NetSuite partner who has years of experience with successful implementations in your industry. 

3. Lack of proper planning.

As we talked about earlier, the discovery and strategy phases are the most critical in the entire process. Without a well-thought-out, thoroughly researched plan on what needs to happen and how to make your implementation a success, it simply won’t happen.

Download the NetSuite Implementation Checklist for FREE

NetSuite implementations are long and laborious. 

But when done well, they can completely transform your business.

Because the truth is, NetSuite can help you:

• Automate key processes
• Have incredible clarity on your finances
• Know what’s going on with your inventory
• And so much more.

NetSuite’s ROI is limitless when implemented properly.

And to help you see a successful implementation, we created a FREE checklist you can download that will help you make sure you aren’t missing a single step of the process.

To claim yours, simply enter your name and email below:

The post NetSuite Implementation Process: A Proven Guide (+ Checklist) appeared first on ERP Software Hub.