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© Copyright 2013 Panorama Consulting Solutions. All Rights Reserved.
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ERP IMPLEMENTATION BOOT CAMP
Christopher Devault Manager, Vendor Relations
Panorama Consulting Solutions www.Panorama-Consulting.com
Phone: 720-515-1377
The Manufacturing ERP Experience Sponsored by MetalForming Magazine October 8 - 9, 2013
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About Panorama Consulting Solutions ● Niche consulting firm with focus on the ERP market ● Our service offerings include:
● ERP Software Evaluation and Selection ● ERP Implementation Project Management ● Organizational Change Management and Benefits Realization ● Business Process Management ● IT Strategy
● Experience with 150+ ERP packages ● Depth in targeted industries including:
● Manufacturing and Distribution ● Financial and Professional Services ● Government and Public Sector
● ERP vendor independent and neutral
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Some of our Clients
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Broad and Deep ERP Experience Some of the 150+ different ERP software packages we
have evaluated and implemented for our clients
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Agenda – Basic Training
● Purpose of this Session ● Basic Training: Keys to ERP Success ● Questions
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Purpose of this Session
● Provide an introduction to ERP best practices
● Summarize some of the general keys to ERP implementation success
● Provide a foundation for these concepts
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1. ERP is about your business, not the technology.
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ERP: Business vs. Technology
Technical Approach Business Approach Implementation Approach
Slam in the system; “Just get it done”
Vs.
Implement quickly, but take the time to get it right
Designing the System Define technical requirements Define business process requirements
Training System transaction training Process and workflow training; emphasizing ERP system as
an enabler of those processes
Measures of Success Minimize technical bugs Minimize disruptions to business & maximize business
results
Organizational Change Management
Train to use the system Build a variety of employee buy-in, communications, and
learning tools
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2. ERP initiatives are very challenging.
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ERP Implementations Don’t Deliver as Expected
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ERP Project Statistics
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ERP Business Benefits Can Be Elusive
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Implementation Budget/Cost
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3. Business process reengineering should start before implementation begins . . . and continue throughout the project and beyond!
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Business Process Reengineering Is an Iterative Process
Selection: Business Requirements
Blueprint: Business Process Reengineering
Implementation: Transactional Processes
Go-live: Process and System Training
Current State
Processes
Future State
Processes
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4. ERP software best practices and pre-configured solutions do not solve all the challenges of ERP.
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Three Levels of ERP Best Practices
Competitive Advantage • Advanced ERP modules and solutions • Customization and Integration to other systems • Typically focused on market-facing enhancements • Examples: CRM, social marketing, eCommerce, forecasting
Industry Differentiators • Unique to industry • Source of competitive advantage • Typically focused on managing internal costs • Examples: Supply chain management, procurement
Basic Functionality • Non-differentiators, common across industries • Not a source of competitive advantage • Typically related to overhead functions • Examples: accounting, GL, order entry
Little use of best practices
50-60% use of best practices
60-75% use of best practices
Impl
emen
tatio
n C
ompl
exity
, Tim
e, a
nd C
ost
Accounts for most of the unpredictability and risk of ERP implementations
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5. Your project will struggle without adequate organizational change management.
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Change is Never Easy…
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Selection and Implementation Life Cycle Life Cycle
Technical Support
Training Strategy Training Design Develop Training Materials and Plan
Trai
ning
Del
iver
y
Post Implementation Support
KPI Validation
Business Case
Benefits Realization Development
Performance Mgmt / Benefit Realization Audit
Implementation Services Software Selection
Stakeholder Analysis and Executive Alignment
Marketing and Communication
Organizational Readiness
Risk Assessment
PCS Activity Technical Activity
Business Process Management
Organizational Change Management
Organizational Design
Roles and Responsibilities Matrix, Sourcing, Transition Planning
ERP Configuration
Reports, Interface, Extension and Conversion
Development
Cutover
Data Conversion
Blueprinting
Trai
ning
Benchmark Assessment
Contract Negotiations
Vendor Evaluation
IT Strategy
Blueprinting
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6. If your operations and ERP system are misaligned, it’s probably not the software’s fault.
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Misalignment of ERP Systems
Initial Requirements Misalignment
between ERP system and
business requirements
Initial Implementation
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7. Expectations are high, but many organizations don’t properly define the “ERP finish line.”
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Companies’ ERP Expectations
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Companies’ ERP Results
Source: Panorama Consulting’s 2013 ERP Report Copyright © 2013 Panorama Consulting Solutions
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Three Phases of ERP Competitive Advantage & ROI
Phase 0: Legacy System
• Broken business processes
• Misalignment with business requirements
• Technological obsolescence
ERP Phase 1: “Go-Live”
• Core functionality • Embedded “best
practices” • Industry pre-configuration
• Limited alignment with competitive edge
ERP Phase 2: Competitive
Edge • Advanced modules &
functionality • Third party bolt-ons
• Reporting & analytics • Business process
improvements • Customization
ERP Phase 3: Results & ROI
• Fine-tuned business processes
• Fully leveraged functionality
• Superior ability to analyze and execute
Time
Bus
ines
s B
enef
its a
nd C
ompe
titiv
e A
dvan
tage
28% of ERP implementations* Business process re-engineering and
organizational change management focus
72% of ERP implementations* Software focus
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8. Nearly all organizations strive for “no customization,” but 90% end up customizing.
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ERP Customization Level
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9. Executive buy-in and support is critical to ERP success.
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What Does Executive Buy-in Mean?
● Approve project budget ● Assemble steering committee ● Key business decisions ● Project status ● Approve changes to scope ● Approve software customization
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How Frequently is it Achieved?
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10. If you don’t measure it, you won’t achieve it.
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Cascading KPIs Through Your Organization
• Sales and profit by region • Sourcing costs • Number of product introductions
per year
Business Unit KPIs
Business Unit KPIs
Departmental KPIs
Individual KPIs Individual KPIs
Departmental KPIs
• Average inventory cost by location • Number of new designs per employee
Corporate KPIs Tied directly to corporate-level goals
Sample KPIs • Wholesale sales
and profit • Retail sales and profit • Product development time to market
• Average inventory costs • Number of new product designs completed per
year • Inventory accuracy
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Downstream Importance of KPIs
Key Performance
Indicators
Business Case
Justification Data
Requirements Reporting
Requirements Business Results
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Questions? Chris Devault
Manager, Vendor Relations Panorama Consulting Solutions
[email protected] 720-515-1377