ERP the Right Way!

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Podcast: ERP Organizational Change Success

Dr. Jack G. Nestell and I discuss some key influences on ERP organizational change success including the definition of success, ERP success rates, critical keys to project management, ERP expectations, the role of corporate culture, common challenges and pitfalls, Learning and Development (L&D), ERP organizational change conflict, Leadership styles, critical success factors and more! (Read more…)

ERP Decision Makers – Consider the following…..

Brainteaser: When does ERP requirements management start?

When does ERP requirements management start? Presales? Gathering Requirements? This post summarizes LinkedIn poll responses and provides a realistic response to effective requirements management for an ERP implementation. (Read more …)

Autonomous ERP

Imagine an ERP solution that drastically reduces manual entry by 90%! The remaining exception transactions can be created via Natural Language Processing (NLP) or user confirmation of AI/Machine Language (AI/ML) recommendations. All supplier invoices are electronic. Moreover, bank reconciliations are performed near real-time via blockchain. Supply chains have the ability and capacity to process an order request, gather the commodity from the location, and deliver the unit to the desired delivery point without human intervention¹. Further, sub-ledger reconciliations are eliminated because there is no more need for sub-ledgers. Reports become an obsolete way to communicate information. ERP Cloud updates, testing and feature deployments occur without heavy reliance on third-party consultants. If interested, please allow me to share my vision of autonomous ERP. (Read more ….)

ERP Value Hypothesis

The latest ERP cloud marketing trend is telling value stories and creating a value hypothesis. Everyone likes a good story and creating a value hypothesis sounds more like a “scientific/evidence based” approach. However, new labels do not automatically improve the ERP sales & selection process. (Read more …)

ERP and KPIs

When asked, just about every ERP vendor will say they provide Key Performance Indicator (KPI) reporting. Yet there still remains confusion between metrics reporting and KPI reporting. Unfortunately, using terms like KPI and metrics interchangeably does not help. In the following blog cast and posting I will provide practical guidance regarding KPIs and the role ERP play in supporting KPI management. (Read more …)

Integration Trumps Functionality for Enterprise ERP

By design, ERPs are created to act as the “source of truth”. This design becomes a challenge when the customer has multiple ERP solutions. Each ERP wants to be the master. Most ERP vendors provide an integration to most popular ERP systems but these integrations are point integrations at best. “Best of Breed” may be a viable option if the increased functionality generates a monetized competitive advantage. However, many ERP integration cost analyses only focus on a small area and do not calculate the true cost of ownership. The purpose of this article is to elaborate on the Total Cost of Ownership (TCO) for integrating multiple ERP systems to ensure informed decisions are made by customers. (Read more…)

Using AI/ML to Build Customer-specific ERP Roadmaps

How much does it cost to create a customer-specific ERP roadmap? $50k, $200k, $1m+? This effort typically requires the higher end consultative guidance and advisory role(s). It also requires a significant amount of customer leaders’ effort/time to support this activity. What if I can show you an approach where one can automatically generate a custom ERP roadmap? If interested then allow me to elaborate. (Read more…)

Measuring ERP User Adoption and Engagement

It is generally accepted that user adoption and user engagement are key critical success factors for ERP business value realization. However, a majority of ERP implementations take a qualitative approach for managing user adoption and user engagement. A qualitative approach focuses on data that is subjective, interpretive and exploratory. Let’s see how successful this approach has been in the past. (Read more …)

ERP Business Value Realization

Implementing a Cloud ERP solution does not guarantee business value, regardless of the Cloud ERP provider (vendor). There are countless examples of customers that have not experienced the expected business value articulated in the sales cycle. Why is this? (Read more …)

Disrupting the ERP cloud market via Value Realization Pricing

“In a survey of 1,322 global organizations who had implemented ERP in the previous three years, only 21% of respondents said that they had realized 50% or more of the expected benefits.” It begs the question when will Vendors and the System Implementation (SI) Partners provide a more equitable risk/reward agreement via a business value based pricing model? (Read more …)

Minimize ERP Stabilization Phase

Transitioning from an on-premise ERP system to a new cloud ERP service will result in a short-term reduction in ERP user efficiency. This is less of a theoretical discussion but a practical reality that we need to manage. There is never enough hands-on training or testing because we live in a reality of resource constraints. Moving to an ERP cloud service model is a business risk and no ERP cloud service provider will ever eliminate that risk! The purpose of this blog is to provide recommendations to minimize the business risks associated with your transition to the cloud. (Read more …)

Using AI/ML to create a Customer-specific ERP Business Process Maturity Model

In the previous post, I discussed a new repeatable method for calculating ERP utilization. In this post, I will define a case study where the utilization model is applied for a customer. A key point to be made here is that the health and effectiveness of the business process is directly related to the performance and utilization of ERP features that support the business process. (Read more ….)

Using AI/ML to predict ERP Utilization

There are not many theories on maximizing ERP utilization. There are approaches that do a commendable effort in identifying some of the factors that influence ERP utilization. What is lacking are predictability, repeatability and harmony across the key components of a business solution. The purpose of this article is to provide an overview of my theory on ERP utilization. (Read more …)

300+ Quotes for ERP Implementations

I consider myself an ERP implementation practitioner on the road to becoming a better ERP adviser and leader. During my ongoing research I have collected a database of over 2000 quotes on ERP-related topics (pains, success, best practices, failures, mistakes, implementations, selections). I would like to share my top quotes that have influenced my ERP journey. (Read more …)

JIT Training is Just Plain Wrong for ERP

Given that we are well in the third decade of ERP implementations, I still observe ERP implementations following outdated/misguided concepts that do not utilize limited resources to the fullest. One of these misapplied concepts is Just-In-Time (JIT) training. End user enablement continues to be an implementation challenge primarily due to the limited investment made for the most important component of an ERP business solution. This limitation must be addressed in order to realize the value of ERP in the Cloud. (Read more …)

Challenging ERP Requirements

I do not believe ERP software vendors are the guardians of best practices. Nor do I blindly subscribe to the notion that the customer is always right. What I do know and believe is that a good implementation partner will balance customer needs and wants with the fundamental value proposition of the ERP software to ensure customers have relevant information to make informed decisions. The following blog posting will discuss some practical guidance that implementation partners can utilize to vet business requirements. (Read more …)

ERP Best Practice: Organizational Fit Gap

I think we can all agree that organizational fit is a key consideration for successful ERP selections and implementations. However, mention the phase “fit/gap” or “gap analysis” and most people will fixate on the ERP software. There are several examples of functional/software fit-gap templates/activities but very few organizational fit-gap templates/guides. The goal of this blog is to shed some light on this very important activity. (Read more …)

Troubleshooting ERP Projects

During my career in ERP consulting I had several opportunities to be involved in deployment of emerging ERP products and services. As with any innovation rollout there are challenges to overcome and I had to learn how to quickly triage ERP projects for success. Troubleshooting an ERP project is more than just performing an assessment – it’s implementing a realistic action plan and making it work for all stakeholders involved. Following is a tested and proven approach to jumpstart stalled ERP projects. (Read more …)

ERP Cloud: Services Trump Software

How many ERP cloud offerings are in the market today? The number depends on who you ask but it is a fair statement to say that all Tier I and the majority of Tier II ERP vendors have a cloud offering. A majority of the market and many ERP analysts still take an on-premise approach to evaluating ERP cloud offerings. Services, not software, will have the greatest impact on ERP cloud success. The purpose of this article is to examine the impact services will have in a cloud model. (Read more …)

ERP Deployment vs. Requirements Gathering

Customers, System implementors and ERP vendors are always looking for ways to accelerate ERP implementations. One popular approach is to take a phased deployment approach based upon criteria such as location, ERP module or feature set. Requirements are gathered, validated, and tested based upon a limited scope. Unfortunately, many ERP projects utilizing this approach result in failure given requirements conflict and misaligned expectations. In the following blog posting we will discuss how to minimize challenges associated with phased ERP deployments. (Read more …)

Cloud ERP is not a push button solution

SaaS ERP is the latest effort in the ERP industry to provide a rapid, cost-effective solution for customers who want an enterprise solution. A SaaS deployment model does provide the potential for greater value realization; however, the value proposition is dependent upon appropriate expectations and implementation approach. The purpose of the following article is to provide insight to ensure customers make realistic and informed decisions. (Read more …)

BPR, BPM and ERP

I had a customer ask me about the relationship between BPM and ERP. Does ERP implement BPM or do you need to have BPM before ERP? Is an ERP implementation a BPR project? Who’s on first? As the ERP industry evolves it has become evident that additional disciplines like Business Process Management (BPM) and Business Process Reengineering (BPR) must be employed for a successful ERP experience. In the following blog posting I plan to define and demonstrate the roles that BPM/BPR play in the ERP lifecycle. (Read more …)

Business to IT Alignment – A Practical Discussion

Business to IT alignment is an objective that most technology and business leaders would agree as essential for agility. However, ask for a definition of Business to IT alignment or how to implement an alignment strategy and the likely results are conflicting information and vague guidance. In the following blog I will try to add clarity to this topic as well as provide practical guidance. (Read more …)

Gathering Requirements: What + Why = How

One of the reasons why I am a consultant is that I enjoy solving business problems with technology. ERP provides a technical foundation that I can utilize to solve problems. However, during my career I came to the realization that throwing technology at a business need is not in the best interest of the customer. This is especially true when you do not completely understand the requirement. There is a difference between an evolving requirement and an evolving understanding of the requirement. In the next sections we will briefly review a practical approach for ERP requirements management. (Read more …)

Cloud ERP – Goodbye IaaS, Hello IaaS

One of the first deployment models for cloud computing was Infrastructure as a Service (IaaS). Currently, there is a price war between the major IaaS providers like AWS and Rackspace to provide the cheapest infrastructure. However, enterprise customers looking to move their ERP solutions to the cloud should focus more on Integration as a Service (IaaS). Integration, not infrastructure, will have a greater impact to TCO and ERP success. In the next sections we will briefly compare the influences that infrastructure and integration have on an enterprise solution like ERP. (Read more …)

Building a Business-Aware Cloud Solution

In a recent study conducted by Forrester Consulting “Enterprise Cloud: Lessons Learned From Early Adopters” a key conclusion made is “A complete, application-centric, business-aware cloud solution is needed.” Let’s say that your C-level executive stops by your office and asks you to lead a project to develop a business-aware cloud solution. To be successful it is important to understand what you are building. In the following blog I will attempt to define a business-aware cloud solution. (Read more…)

Finding the Right ERP Cloud Provider

I recently attended Oracle’s OpenWorld Conference in San Francisco this October. There was a huge volume of information on the Cloud. As I walked through the Exhibitor’s halls at the Moscone Center, I observed that every SI partner had ERP in the Cloud or could get customers to the Cloud seamlessly. What I did not see is any offering or advisory service to guide ERP customers through the storm clouds to find the right provider. In the next sections we will discuss the key competencies to consider as part of making an ERP Cloud provider selection. (Read more…)

ERP Business Solution Manifesto

Many sources speak to the symptoms that result in ERP implementation failure but few speak to the root cause of these failures. The root cause has more to do with the wrong implementation strategy. Today, the majority of ERP implementations follow a traditional, “build-from-scratch” approach that is not adequate for implementing packaged software like ERP. What is required is an approach that addresses both the inherent advantages and challenges associated with ERP. Following are 10 principles to assist you in building the right ERP implementation strategy. (Read more…)

The Next Evolution of ERP: Adaptive ERP

With the initial release of ERP, one of the key “game changers” was the ability of business users to access data and generates reports without direct IT involvement. This empowerment of the business user had a significant impact on business agility. Today, we continue to see ERP vendors focus on providing business-friendly tools for reporting and analysis. Yet, I can see a new evolution brewing in the ERP industry what I like to call “Adaptive ERP” where business users can perform on-demand actions to meet business changes real-time. In the next sections we discuss the key capabilities of Adaptive ERP and a practical assessment of where the ERP industry is today. (Read more…)

IT Should Move Up the ERP Value Chain

A key challenge in my role as an IT ERP Director was to maximize business value with a shrinking budget. It was quite an education for a person with the majority of his experience in Tier I ERP Consulting. There are many options competing against IT organizations in providing ERP services (SaaS, Cloud, Off-shore and Near-Shore support models). Two key battlegrounds are ERP software development for customization and ERP support.

Show me an IT organization whose key competitive advantage is that they are internal and I will show you a shrinking IT department! There must be a major shift in IT’s value proposition for ERP support. In the next sections we will discuss some of the shifts IT ERP shops need to make to stay competitive and relevant. (Read more …)

Building a Better ERP Project Estimate

There are several documented examples of ERP implementations that went over budget or did not hit the original go-live date. There are also many explanations out there to explain why these ERP implementations did not meet budget or timeline. Instead of repeating common information out in the ERP blogosphere, I would like to speak to a root cause that is typically overlooked by our industry – inaccurate ERP implementation estimations. In the next sections we will take a closer look at building a better ERP estimate. (Read more…)

Is Cloud Ringing the Death Toll for ERP?

Cloud computing is here to stay, but what does that mean for those who sell and implement ERP solutions today?

First, it means that there is a new way in which business software solutions are being purchased and consumed, and that means resellers need to pay close attention to the way they run their business. Secondly, it means that if ERP companies wish to remain in the game, they need to make some significant changes. (Read more …)

Fact or Fiction: Hybrid ERP Deployments

With cloud computing and cloud ERP gaining additional attention in the marketplace, ERP vendors, resellers, and solution providers are quickly positioning their products and services as “cloud-enabled”. However, in my humble opinion, to simply put ERP software on a hosted server and provide subscription-based pricing does not a cloud solution make. A key value proposition for cloud ERP is the ability to support a truly hybrid ERP deployment. In the next section we will discuss what is an ERP hybrid deployment including the opportunities and challenges this type of deployment presents. (Read more…)

Developing a Business Case for ERP Customizations

To customize or not to customize – that is the question which continues to be a source of contention and confusion. On one hand, customization(s) can result in an expensive ERP solution. However, ERP software enhancements can provide a competitive advantage or cost reduction that is customer-specific. The challenge is not in the question itself but rather how the answer is justified. Unfortunately, many business cases ERP customizations are either too short-sighted or do not fully comprehend the impacts to the ERP investment. In the next section we will discuss the key components required for an ERP business case for customization(s). (Read more …)

Cloud Can Bring Out the Best of ERP

Previously, I discussed some of the hard realities customers have to manage as part of a Cloud ERP solution. However, these challenges should not deter customers from looking at a Cloud ERP deployment model. There are broad advantages for Cloud ERP including incremental scalability and smaller start-up investment. I would like to speak to some of the less known advantages that a cloud model can provide to ERP customers. (Read more …)

Viable – Manageable ERP

Several ERP implementations suffer from what I call a “fast-food” mentality of delivering value. Customers feel that they need to get functionality that addresses both existing needs but also future needs given long implementation cycles. Business needs and business wants get blurred together during requirements gathering which make it harder to differentiate and validate. Finally, more analysis and effort is spent trying to fit one more feature or capability into the ERP implementation versus understanding the support requirements after the implementation. Typically, the result is a solution that causes more problems than it solves because the ERP solution is not sustainable. In the next sections, we will discuss some principles to prevent your ERP project from delivering an unmanageable solution. (Read more …)

Business pain can be good for ERP

Instinctively, we all try to avoid or minimize pain. This is true for individuals as well as business organizations. However, in our attempts to reduce pain, we too often focus on eliminating the symptoms without addressing the underlying root cause. We may feel temporary relieve but our short-term decisions only lead us to a point were the pain resurfaces and the available options to address the pain become more limited and costly. In the next sections, we will discuss how to address business pain by effectively utilizing your existing ERP investment. (Read more …)

ERP Application Strategy Roadmap

You have just implemented your ERP solution – congratulations! Now what? Will your ERP experience become an endless cycle of applying maintenance patches and upgrades? Many customers only realize a fraction of the business value that ERP can provide. Too often customers rely on their ERP vendor to provide the long-term vision and strategy for increasing ERP ROI – which is general as best. In the next sections, I would like to speak to you about internally creating the vision and strategy for maximizing your ERP investment over the long-term. It all starts with having an ERP application strategy roadmap. (Read more …)

Cloud ERP – New Dog, Same Fleas

I am very excited about Cloud ERP and the potential opportunities for customers, however, I like to speak to the minority opinion for a balanced discussion. Just as ERP was deemed the panacea for all business automation pains, Cloud ERP is positioned as a revolutionary approach to deploying an ERP solution. Cloud ERP provides a solution that is flexible, adaptable, scalable, efficient, and affordable. Customers can enjoy painless upgrades, rapid deployment, and easy customization along with availability “anywhere at anytime”! Practically speaking, Cloud ERP is just another deployment option available to customers. The activities required for an “on premise” ERP implementation are also required for Cloud ERP. The scope and responsibility for the implementation activities may be different but most assuredly they are still required. Let’s further discuss the key impacts that a Cloud ERP deployment will have on the implementation. For our discussion, we will refer to the following standard ERP life cycle. (Read more …)

Best of Breed vs. Integrated ERP

We have all heard the proverb “A chain is only as strong as its weakest link.” Applying this concept to business software, we would conclude that a business solution is only as strong as its weakest integration. Usually overlooked and underestimated, integration is one of the most important factors to consider as part of a best of breed vs. integrated ERP solution. The benefit of richer functionality is limited by partial integration. In the next sections, we will discuss all the factors to consider as part of making an informed decision regarding best of breed vs. integrated ERP. (Read more …)

Creating a Flexible and Adaptable ERP Solution

Every customer I assisted in their ERP implementation wanted an ERP solution that would be flexible and adaptable. One of the key challenges and disappointments customers have with ERP are around flexibility and adaptability. We also need to address the common misinterpretations associated with the concepts of a flexible and adaptable ERP solution. Referring back to a previous blog we know that ERP is only one component of a business solution. There are three key areas to address as part of developing a flexible and adaptable business solution. (Read more …)

Conducting ERP Assessment to Maximize ERP ROI

Many have come to know that ERP projects never really end. An ERP implementation is only the beginning of a journey with many twists, turns and – unfortunately – missed opportunities. The majority of business value ERP can generate happens during the maintenance life-cycle. Many customers never realize the full potential of ERP due to the maintenance strategy employed. What can we do to stay the course and ensure that customers can realize the value articulated in the ERP sales cycle? (Read more…)

Defining Scope for ERP Implementations

I know that everyone whole-heartedly agrees that having a well-defined ERP implementation scope statement is strategic to success. However, there are few articles or other resources that provide detailed guidance on building scope statements. I would like to focus on one key area that is typically not clearly articulated for ERP implementations. (Read more …)

Best approach for gathering ERP requirements

How You Gather Requirements Sends a Message!

Let’s us go through an analogy together. You are the customer and I am the consultant working with you to develop some software changes for your packaged software. As the consultant I can take two approaches for gathering requirements (Read more …)

ERP Makes for an Expensive Custom Solution

The Allure of Technology

Think of the possibilities! Rapid delivery of new functionality! Reduce development cost by quickly deploying prebuilt solutions! If the software does not meet your needs then use the delivered, user-friendly development tools to customize the ERP software. We have the technology to make your business more flexible and adaptable. Most customers do think about the possibilities quickly but have a hard time taking that vision and incorporating it into the realities that are involved with using ERP. (Read more …)

Customers – Insist on an ERP Knowledge Transfer Plan

What Gets Tracked and Measured Gets Done

How do you measure knowledge transfer? Customers – have you ever received a report or completed checklist that demonstrated the Implementation Partner conducted knowledge transfer? Knowledge transfer is a process, not just a milestone task on a project plan. Consider the following illustration to identify the importance of knowledge transfer. (Read more …)

Embrace Changing Requirements for ERP Implementations

Business is Changing! Don’t Fight it – Embrace It!

A key challenge with any ERP implementation is changing business requirements. Yet many project teams are surprised when business requirements change. Think about it, the scope of an ERP implementation is based upon a “point in time” solution. Competitive business models are constantly evolving to meet customer demands. Today, the majority of ERP implementation approaches discourage changing requirements by having laborious scope change control procedures that tends to be more of a roadblock than an enabler. What is required is a more proactive approach to identify differentiated requirements that can provide a competitive advantage to ERP customers. (Read more …)

Decisions – Not Documents – Move ERP Implementations Forward

Information Alone Does Not Generate Value

I grew up in a time when information was hard to obtain. Generating information was seen as a valuable exercise because information was a scarce resource. The first software development life cycle (SDLC) I learned was Waterfall. One of the key focus areas for the Waterfall SDLC was documentation (i.e. information). However, there is a limit regarding what value information can provide. In our enthusiasm to create information we sometimes go to an extreme and generate so much information that it becomes a roadblock. What we often forget is that the key purpose of gathering information is to make decisions! (Read more …)

Business Leads and Technology Supports

There is a misconception in the ERP market that says technology is the key enabler to business maturity. In a previous blog (ERP is Only Part of a Business Solution) I discussed the supporting role ERP plays in a business solution. Business processes and people have a far greater influence on business process maturity and business results. Let’s clear up this misconception by examining two areas that have driven its general adoption. (Read more …)

ERP is Only Part of a Business Solution

Back in the 80s Enterprise Resource Planning (ERP) was deemed the panacea for business pains caused by operational inefficiencies and disjointed applications. Then came the realization that ERP was not the final solution but just one piece of the puzzle. In addition we learned that change was not just a software issue, that implementation is not the same as installation, and that the cost of ERP is not a one-time expense. Above all we learned that ERP is only part of a business solution. (Read more …)

Progressive Leadership for ERP

Knowledge transfer is only the beginning to enablement.

Many implementation partners (including myself) have handled enablement as an event or milestone that occured as part of the cut-over to production. We as implementation partners too often assume that the traditional, informal “do what I do” approach between consultants and customer was sufficient for customer enablement. If the traditional approach was sufficient for customer enablement then one can argue that there should be no need of post production support. (Read more …)

Get it wrong the first time! The case for ERP iterations

We have all heard the phrase “Get right the first time” used as part of an effort to reduce costs and accelerate implementations. Unfortunately, many have interpreted this to mean doing an activity once. We attempt to run ERP implementations as a production process. Good production processes deliver the anticipated result (a known result), for a standard cost, within a given time. In contract, ERP implementations are more of an exploration process given the customer variability. Consider the following illustration: (Read more …)

Reverse Engineer to Business Requirements

A critical activity for any ERP implementation is gathering business requirements. The purpose of business requirements is to define the needs that will enable business activities to generate business results. The traditional school of thought is that if we capture all the requirements then we assume that we will develop a solution that will produce the desirable results. I believe that experience has taught us that the above assumption is not correct. (Read more …)

IT to Business Alignment for ERP implementations

You’ve decided on the ERP software you need, the Business side has bought into it, and you’ve even picked your Implementation Partner. Now the hard work begins: Making sure that your software deployment strategy sets your company up for success, and that means making sure Business, IT and the Implementation Partner are all speaking the same language. (Read more …)

When ERP methodologies go wrong

Webster defines a methodology as a body of methods, rules, and postulates employed by a discipline: a particular procedure or set of procedures. Methodologies add tremendous value to the implementation team by providing a process to guide the team through the implementation. Methodologies have inherent assumptions, risks, and constraints. For an ERP implementation multiple methodologies are involved. (Read more …)

Applying Pareto’s Principle to ERP Selections

The Pareto principle (also known as the 80-20 rule), states that, for many events, roughly 80% of the effects comes from 20% of the causes. The principle was developed to explain income and wealth distribution in Italy. This principle has evolved into a “rule of thumb” in business. In the software industry the Pareto principle has been applied to several areas: (Read more …)

Five key areas to consider when selecting ERP software

There are five key areas to consider when selecting ERP software:

(1) Functional Fit

How well does the ERP software fit with (a) current business requirements and (b) future business requirements? Too often I see vendor responses and demonstrations spend too much time on “core” functionality and not enough time on the unique and strategic requirements of customers. These are the requirements that generate a competitive advantage to customers. (Read more …)

Key Project Management Strategies for ERP implementations

I had a colleague ask me what are the key project management strategies for successful ERP/COTS implementations. I laughed and told my friend that I’m still learning! My friend is an experienced, certified project manager (PMP) so I spared him the foundational best practices (approved project charter, executive support, risk management, communications, etc). These core best practices are well known and documented. I wanted to go to extra mile and provide advice that may not be well known or understood. Following are the key strategies that drive my project management approach for ERP/COTS implementations: (Read more …)

Accelerating ERP/COTS Implementations

Accelerating ERP/COTS implementations have been an elusive goal of vendors, implementation partners, and customers. For five years I worked for the #2 business software maker focusing on accelerating implementations. During those five years I chased the dream and learned many lessons along the way. Following are some of the key lessons I would like to share with you. (Read more …)