Twenty questions for CFOs embarking on an ERP project

cfo-questionsAs the CFO of an organization, your responsibility is to ensure efficient and effective financial operations and records, and influence overall strategy. An ERP is the foundation of the operations of a business. For a CFO, it enables you to track and report on all business transactions, analyse information, ensure governance and compliance, and increasingly do this via mobile devices. Therefore, you need to be very sure your ERP project will deliver what the business requires, and also what was promised.

Before going ahead with an ERP project, you should have addressed these questions.

Planning and selection

  1. What is the executive board’s experience with business software? Will there be sufficient executive involvement beforehand, and how will it be maintained during the project and afterwards?
  2. Are the business objectives clear, and is there detailed understanding of what you want to achieve? Do you just want a new system, or do you want to change the business – its processes, what roles people perform?
  3. How will you engage with vendors? Will you short-list with the use of an extensive RFP (Request for Proposal) sent to lots of vendors; use recommendations and peer contacts to identify a smaller number of vendors; do your own research on the Internet to identify possible vendors; employ the services of an external consultant?
  4. How will the chosen solution impact the way you do business – what aspects will it dictate to you, and what can you change to suit your needs?
  5. What benefits do you expect, and where will you look to find:
    1. Increased revenue
    2. Decreased costs
    3. Improved quality
    4. Better customer service
    5. Shortened manufacturing cycle time
    6. More accurate inventory information
    7. More streamlined processes
  6. Have you got details of all the costs involved?
    1. For the obvious items – software, infrastructure, services, training, support
    2. For less obvious ones – budget for data conversion/take on, third party software integration, change management, process modelling.
  7. How will you ensure that the consultants engaged for implementation can be treated as:
    1. trusted advisors
    2. knowledgeable and experienced in your industry issues
  8. What are the cost, time and effort implications of upgrading the ERP software?

 Implementation and training

  1. Is the project scope clearly defined? How will you handle the scope changes that so often happen during an ERP project?
  2.  Are the right internal people involved? What might their agendas be?
  3. How will training take place? If the staff needs proper training, how will it be scheduled to minimize the effect on their day-to-day work, bearing in mind they will also need the time and opportunities to practice and learn the new skills.
  4. How will the project impact both the intended users and the current IT team? How will they manage time on work vs. on the project?
  5. How will the ERP software work with other applications that the business relies on?
  6. How easy is it to access information via reports, or other sources?
  7. What procedures need to be implemented to safeguard governance, regulatory reporting and compliance?

Ongoing use, management and maintenance

  1. What ongoing training and education programs need to be instituted so that staff continue to use the system effectively?
  2.  What strategies are required so that the ERP system encourages the standardization and classification of information across the business
  3. How will you extend the ERP system from just a transactional system to one that assists with planning, analysis and insight?
  4. What people and policies will you put in place to maintain the Return on Investment of the ERP system?
  5. How often will you review the alignment of the ERP with the business?

This was originally published on the SYSPRO Smarter ERP blog



Implementing ERP more effectively

Part 2 of a series on enterprise information systems

Building a house on a solid foundation

This blog has been cross-posted on the SYSPRO corporate blog.

You can hardly miss it these days: questions about why Enterprise Resource Planning (ERP) projects hit problems, or worse fail, are appearing on many websites. I have seen many ERP implementations and thought I had some answers, but it was only after I had been involved in building a house that I could see the similarities between building projects and ERP implementations, and why we don’t see buildings collapsing in the same ways some ERP projects fail.

Eric Kimberling’s Panorama Group identified this similarity at the same time I was building the house. The critical requirement for construction is the blueprint; the drawings of what the house will look like, what its parts will be and how it will be constructed.

The problem with projects, especially complex ones (like a house or an ERP project), is how to communicate the varied components, interactions, hierarchies and responsibilities to all parties concerned. You need a representation that will capture all these elements in a way that is clear and easy to understand, even if you are not a professional in the field. This will ensure that the various parties involved can achieve alignment in terms of common understanding of business needs and technology capabilities.

You also need a way for the plans to develop as your ideas and perspectives evolve. When you start planning a house you don’t go straight into the details. You may have some thoughts (even a vision), but you need guidance from an architect on what is possible, feasible and within budget. So you start with drawings that help you decide on the appearance of the house, then move into the technical and architectural details, and finally the construction and engineering specifications.

Until recently there was no easy way for ‘ERP novices’ to see the business in terms of how it would look after an ERP implementation. But now, with the integration of business process modeling (BPM) and ERP, those visual representations (the drawings) can be done. For an ERP implementation, the functional requirements and business processes are like the rooms and materials of a house, and a business process model is the equivalent of an architect’s drawings. The Business Process Modeling tool can be used in the same way that you start a house with some initial sketches. It allows you to view the business from a high level to make sure executives agree with the ‘look’ before going into more detail.

This graphical way of representing an ERP project can replace the mountains of design documents that were the staple of past ERP projects. This pile of paper used to be the main documentation a business had to describe its strategy, plans and processes. The sad fact was that only a few people ever probably read them, and even fewer understood them.

It’s about time that “the big freakin’ requirements document must die”. What is needed is one tool which can capture scope at different levels in one place, which provides traceability between business requirements and IT capabilities, and which uses better means of communication to illustrate than the common legal-style text of many project documents.

If you are an ERP implementer, how did you experience communicating via traditional project management tools? If you’ve experienced an ERP project as a business user in the past, what did you think of the project documents that you had to use?

At SYSPRO, we now provide a tool that can replace the big project document, which is graphical and shows how integrated BPM and ERP functions: SYSPRO Process Modeling (SPM). Analyst Brian Sommer described the combination as “A Key Mid-Market Need”. With SPM we believe that our customers will get more value, and have a far lower risk of problems in their ERP implementation projects.

In the next part of this series: changing the system as business realities change.