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The project team is key to ensuring a successful ERP implementation. As a CIO or IT leader, knowing the right people and functions you'll need -- and how to get the best out of them -- can help reduce the likelihood of failure.
Here are five principles to follow.
1. Start with fundamentals
Before choosing project participants, you should understand the bigger picture.
Understanding the fundamentals of the business case should come first, said John Belden, project execution advisory lead at UpperEdge, a Boston-based IT negotiation advisory. This includes knowing how and why the business works.
Although selecting the right technical skills is important, it's equally important that the participants are able to collaborate, facilitate, negotiate and recognize risk, Belden said.
You can include early participants, such as solutions architects and business experts, to lay out the technical and business groundwork for the project. Solutions architects and business experts already work with a variety of other roles in the company to provide a broader perspective and guidance. Once the internal ERP project team has been established and is on the same page, engage systems integrators with the appropriate oversight to reduce the risk of cost overruns.
2. Choose key players first
Successful ERP implementation starts with a solid team, and a team is only as good as its foundation.
The solutions architect is the first role that enterprises need to create for a new ERP project team, said Gus Cicala, founder and CEO of Project Assistants, a business management consulting service based in Wilmington, Del.
Gus CicalaFounder and CEO, Project Assistants
The solutions architect can work with other stakeholders to kick off the practice of mapping your organization's needs. This is necessary because your organization needs to know which vendor to go with.
"Obviously, an organization shouldn't let an outside sales department manage the ERP selection process," Cicala said.
The solutions architect should start with the organization's requirements and use those as the basis for the search. Then, they can create a well-defined set of measurable statements, a project charter that outlines why the result is necessary, what requirements need to be satisfied and how this will be managed.
Even when you trust the vendor, it's important to have a point person inside who can adapt a vendor's approach to the needs of the organization itself, Cicala said.
Business process owners complement the solutions architect with a business perspective for the ERP project team.
"These are typically midmanagement-level folks who know how the business runs, understand what makes a business unique and ultimately influence others in their department because they are respected leaders," said Andrew Park, VP and partner at Cincinnati-based Centric Consulting.
Business process owners are key to requirements, design and test validation, change management and all other facets of the project.
3. Choose other key roles
Once the foundation has been laid, it's time to build out the other internal roles of the ERP project team.
The necessity of other key roles depends on the scope of the project and your company's overall goals, Park said. For example, a team may need experts in multiple subjects. Here are a few common ERP project team roles:
- Executive leader. The executive cheerleader is in charge of the purse strings, keeps everyone's eyes on the larger mission at hand and addresses tough situations.
- Project manager. The day-to-day ground commander keeps the business happy, manages risks and makes sure scope, timeline and budget are all in check.
- Functional and technical architects. These are the deep ERP product folks who expertly translate business requirements into processes and system features that will fit best and assess current and future needs.
- Business and technical analysts. These business experts are responsible for requirements gathering, documentation design, process mapping, configuration, testing, data conversion and training.
- Subject matter experts. These people are specialists in industry, process or technology and help guide system design and building.
4. Get support across the organization
Once the core team has been fleshed out, it's important to establish a working relationship with other groups within the organization.
"You are going to need lots of help from the rest of the organization," Belden said.
Get support from other departments, such as purchasing, HR and legal. The entire organization needs to become formally engaged in the program to deliver competent resources and achieve success.
5. Understand how to manage an external team
You'll be in a better position to provide oversight to external partners once the internal team has emerged. External partners -- for example, systems integrators -- can be expensive, so it's important to be strategic.
"When you consider that any overspend on your part results in increased revenue and profit on their part, it becomes a stretch to think of your partnership as driven by mutual interests," Belden said.
Cost overruns in ERP programs are normally rooted in paying the systems integrators much more than what was originally planned. These cost overruns often occur without penalty to the systems integrator because the contract specifically spells out exceptions for which extra spending was justified.
These exceptions can occur because of gaps in understanding the functional aspects of a business case, data expertise, organizational change management and program oversight, Belden said.
Bringing in experts with the missing skills can reduce the risk that these gaps lead to cost overruns.