8 Key ERP Implementation Steps

To someone who has never been through the ERP implementation process before, the prospect of taking on such a project might seem a bit overwhelming. By following some time-tested ERP implementation steps, though, you can achieve outstanding results, providing your business with a myriad of benefits.

A new ERP system helps you save money, increase efficiency, improve collaboration, and provide greater transparency through improved reporting and analytics. Getting those results will require a commitment of time and money, but with the proper discovery and planning, those investments will pay off very quickly.

In this article, we’ll outline how to implement ERP in an organization broken down into 8 key ERP implementation steps.

What is an ERP implementation plan?

An ERP implementation plan is a documented process that outlines the key steps to rolling out an Enterprise Resource Planning system in your company. ERP implementation planning is the first part of a larger implementation process in which the organization’s ERP requirements are identified and documented, business processes are mapped to the software’s capabilities, experts design and configure the ERP software to work optimally for the business, and the system is tested and rolled out to the organization.

The ERP implementation plan begins with discovery. This is usually the point at which a project team is assembled. Typically, team members are drawn from various parts of the business, as we will discuss a bit later. Together, your project team members should represent a cross-section of departments and functions so that the discovery and planning process will incorporate various points of view.

Planning an ERP implementation is an iterative process. Start by identifying your objective and high-level requirements, and start to build out your project plan at a high level. It can often be useful to refine your vision as you proceed through discovery and planning, so don’t expect that your ERP implementation plan will be set in stone during the early stages of the project.

Who should be involved in the ERP system implementation process?

As has already been noted, your ERP implementation team should consist of various stakeholders from throughout the organization who can bring different perspectives to the table. At the same time, though, you should expect certain functions to play a more prominent role than others in your ERP system implementation process. Accounting and IT, for example, will play critically important roles. Nevertheless, operational roles must also be part of the process in order to make your ERP implementation successful.

Here’s a synopsis of the key players who should be part of your ERP system implementation team:

Accounting plays a pivotal role in your ERP implementation because ultimately, the software serves as the central nervous system for virtually all of your company’s financial functions. Core accounting modules such as general ledger, accounts payable, and accounts receivable all sit at the heart of any modern ERP system, making it the go-to system for financial management. For this reason, the accounting or finance department usually takes a leadership role in the ERP implementation planning and rollout.

The IT department likewise plays a critical part in the ERP implementation process. Even if you opt for cloud ERP, which offers expert maintenance, monitoring, and support; you will still want to involve your IT department as a key player. IT will have a deep understanding of the technology platforms, the benefits or drawbacks of various options, and the cybersecurity implications. Your IT department will also have a strong interest in understanding the integration capabilities of the ERP system you select, so that other systems can be linked to it easily.

Senior Management should also play a prominent role, especially in the discovery and planning processes. There are many benefits of an ERP system, but it is important that executive management has an opportunity to articulate their priorities at every stage of your ERP implementation process.

Manufacturing leaders play an important role in any organization in which any kind of production process takes place. ERP software can help manufacturing companies schedule jobs more efficiently, align labor and materials with production priorities, report on the profitability of each specific job, and coordinate maintenance of machinery and equipment. ERP software also plays a pivotal role in compliance for most companies, so it’s very important to include leaders from your manufacturing team.

Purchasing & Supply Chain Management personnel should also be closely involved with your ERP system implementation process. Most businesses involve at least some level of supply chain management such as the purchase of raw materials, finished products, spare parts, or supplies. These business processes involve calculating lead times, ordering product, accepting delivery, managing inventory, and releasing goods for production or sale. As such, purchasing and supply chain professionals play a key role on your ERP implementation team.

Sales & Marketing will use the system routinely, or will at the very least want to run reports that summarize the key data from your ERP system. They may be especially interested in data migration and its impact on reporting historical sales information. They can also be very helpful in making sure that user training meets the needs of a broad population of users within the company.

Human Resources may also play a key role, depending on the type of HR or payroll functionality you intend to deploy as part of your ERP system implementation. If you run your own payroll systems in-house or if you do substantial amounts of project-based work, then HR should probably have a voice in your ERP implementation process.

What are the key ERP project implementation steps?

Once you have assembled your ERP project implementation team, you can proceed with a step-by-step plan to design, configure, test, and roll out your ERP solution:

Step 1: Define the Scope
The first ERP implementation phase is to define the scope and key objectives of the project. Why do you need a new ERP system? Which specific benefits are you aiming to gain? Will you initially focus on specific business processes and address other business processes later? It’s important to have a long-term vision for what you intend to accomplish with your new ERP system, but it can also be useful to take a stepwise approach to get there. By defining your scope, you can ensure that you will focus on the most important ERP benefits first.

Step 2: Select the best ERP solution for your needs
Selecting an ERP system can be a challenge, especially if you are not familiar with the many ERP software options available to you. It’s a good idea to enlist the support of a knowledgeable ERP partner or consultant. The best ERP consultants will take the time to understand your business and recommend the system that will meet the unique needs of your organization.

Step 3: Map out your business processes
The third step involves mapping out your key business processes and determining how best to operate within the context of your new ERP software. In many cases, your new ERP system implementation will afford you the opportunity to improve those processes, redesigning and enhancing them to provide greater efficiencies and visibility to information.

Step 4: Configure the system
Once you have mapped out your business processes you will need to install and configure your new ERP software. This includes everything from adding new user roles and permissions to designing reports, configuring screen layouts, and integrating your ERP system with external applications and systems.

Step 5: Test and revise
This very important step in the ERP implementation process should not be overlooked. The testing phase provides valuable feedback and reveals any adjustments that might need to be made before you go live with your production ERP system. Enlist key users from each department to try out the new software and provide feedback. This step in the ERP implementation process affords you the opportunity to address any concerns proactively.

Step 6: Train your users
Once you are confident that your new ERP system implementation is on track to deliver all the expected benefits you have set out to achieve, it’s time to train the various end-users throughout your organization. Ideally, you should set up a test environment that mirrors the system configuration that you will eventually use when you go live.

Step 7: Perform your data migration
Data migration is an essential element in the ERP implementation process because it ensures that all of your data is available in the new system; including things like customer records, inventory items, general ledger balances, and more.

Step 8: Go live, evaluate, and improve
Going live on your new ERP system can be a much smoother process than many people make it out to be. If you have done a thorough job with discovery and planning, and if you have executed all of the other steps of the ERP implementation process effectively, the cutover to your new ERP system should go smoothly. The first few days and weeks provide a good opportunity for evaluating your ERP implementation and setting goals for your next phase of system improvement.

What are common reasons for ERP implementation process failures?

Unfortunately, some ERP implementation failures do happen. Here are some of the common reasons:

Inadequate discovery and planning can lead to an incomplete understanding of business processes. Make sure your project team is engaging a wide range of stakeholders.

Selecting the wrong partner and/or vendor can have long-term negative consequences. Check references and make sure you’re working with experts who are willing to take the time to understand your business processes in detail.

Poor project management can derail even the best-planned ERP implementations. Assign a project manager who can develop a schedule, map out dependencies, and hold team members accountable to their commitments.

Limited testing and/or training can result in functional gaps that might never have been necessary. Users often assume that you know every detail of their business processes. Without adequate testing and training, it’s hard to know if anything has fallen through the cracks until it’s too late.

Best practices for the implementation of an ERP system

As you plan your ERP system implementation, keep these best practices in mind:

Cross-functional collaboration is critical because virtually everyone in your organization will have a stake in the outcome. People from every part of the business should have a voice in the process.

Change management is a necessary component of a successful ERP implementation. Users may be resistant to new ways of doing things, so it’s helpful to engage them proactively to educate them on the benefits of ERP.

Resist “scope creep”. When you allow stakeholders to pile on new requirements throughout the ERP implementation process, you’ll make it more difficult to achieve your primary objectives.

How to get started with ERP implementation

The best approach to starting your ERP implementation planning process is simply to meet with experts to discuss your goals and objectives. What specific benefits are you looking for from an ERP system? What unique challenges is your business facing? How might ERP software help you grow, operate more efficiently, and increase profitability?

If you would like to begin that conversation, please reach out to the experts at WM Synergy. Our goal is to first understand your business, then identify the right ERP solution to fit your needs.