ERP Implementation

The process of implementing ERP system is called as ERP

implementation life cycle.

When any company think/decide about ERP Implementation life cycle, at that time
they focus of ERP project which is carried out to make ERP up and running. This ERP
project/ ERP implementation life cycle is different from company to company. Its totally
depends on organizational culture, size, the nature of projects, complexity of project,
development methodology, etc. ERP project is gone through different phases. The
sequence of these phases and other details of the ERP implementation will vary from
organization to organization. E.g. if the organization have already identified a particular
package, then logical order of phases is followed.

In these phases, it is not necessarily depends on one another in a sequence. i.e. one
phase might start before previous phase has finished. So, there are no clear separating
lines between these phases. But logical order of phases is followed.

There are different phases of ERP implementation life cycle, as described below:-

1) Pre-evaluation screening

2) Package evaluation

3) Project planning phase

4) Gap Analysis

5) Reengineering

6) Customization/configuration

7) Implementation team training

8) Testing

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 9) End-user training

10) Going Live

11) Post implementation phase

Different stages of ERP implementation/ ERP Implementation Life Cycle:-

Go ahead
Company Mgmt Pre-evaluation screening ERP Vendor

Package evaluation

Project planning phase

Gap Re-engineering Customization

Analysis /configuration

Implementation Testing End-user

team training training

Going Live

Post implementation phase

1. Pre evaluation screening- Once enterprise has decided to apply ERP system the search
for perfect package start. But there are several of ERP vendors-off many sizes and
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 shapes. Analyze all the packages before reaching a decision is not an easy process, its
very time consuming. Company should do per-evaluation screening to limit the number
of ERP packages that are to be evaluated by the committee.

2. Package Evaluation: The selection process is the most important stage of the ERP
implementation because the selection will decide the success or failure of the project.
ERP system cost huge investment, once a package is purchased then it is not easy to
switch to another one. The objective of selection process is not to identify a package that
covers each and every need but also find a package that is flexible enough that covers
enterprise needs.
Selected package should fit to the different department’s needs, so it considers
all the departments in the selection of package. And so it is a team decision not a
one-man decision. Thus it should have department wise as well as company acceptance.
Important points to be kept in mind while evaluating ERP software includes:-
 Functional fit with company’s business process

 Flexibility and scalability

 Effectiveness, Transparency

 Complexity

 User friendliness

 Quick implementation

 Technology- client server capabilities, database independence, security.

 Amount of customization required

 Total cost, cost of license, implementation, maintenance, customization and hardware

requirements.
 Database and their independency, Security
In the selection committee peoples from various departments, top management and
consultants (Package Experts) are included and take decision about ERP package.

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 There are different role of peoples in selection committee E.g. departmental
representative describe their needs , Consultant (Package Expert) acts as mediator who
explain details of each package & top management are to decide that package are best fit to
company’s business or not.

3. Project planning phase: The project planning phase is the phase that designs the
implementation process. This phase directs about how follow implementation. Such as time
schedules, deadlines etc. In this phase roles are identified and responsibilities assigned.
The organizational resources that will be utilized for implementation process are
decided and people who are supposed to head the implementation are identified. The
implementation teams members are selected and task allocation with responsibilities are
assigned in this phase.
In this phase it will decide that
When to begin the project?
How to do it?
When the project is supposed to be completed?
The phase will also plan for contingencies & how to control as well as monitor
the progress of implementation with controlling measures & corrective actions.
For checking progress as well as controlling committee meets periodically & review
the work & decide the future actions. This committee is headed by CEO (Chief Executive
Officer) or COO ( Chief Operating Officer)

4. GAP analysis: In the gap analysis stage companies create a complex model of their current
status i.e. where they are now and where they want to reach. The trick of gap analysis is vendor
covers functional gaps. It is also estimated that ERP package is fulfilling companies need or
not. If not or partially solutions are-
4.1) Pinning your hopes on an upgrade
4.2) Search third party product that might fill the gap.
4.3) Design a custom program.
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4.4) Altering the ERP source code. (Most expensive alternative)

1. Reengineering:
It is the phase that involves human factors. In ERP implementation settings,
reengineering has two different steps:-
i) Controversial:-
In this step involve the use of ERP to Aid in downsizing efforts- reduce
significant number of employees.
ii) Business Process Re-engineering (BPR)
The BPR approach to an ERP implementation implies that there are two
separate, but closely linked implementations on ERP sites
a) Technical Implementation
b) Business Process Implementation
Implementation of an ERP system involves reengineering/ changes of the existing
business processes to the best business process standard. ERP system built upon best processes
followed in the industry.

2. Customization/ Configuration:
This is the main functional area of the ERP implementation. In this process the
existing business processes synchronized with ERP package. Prototype is created before
implementation it live. Testing is done on prototyping.
Configuration/ Customization is not only reveals strength but also weakness of the
company business processes with explaining where is the deficiency/gap & what are solution
for that.
3. Implementation team training:
In this phase of ERP life cycle implementation team is being trained. At the same

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time customization is taking place. Training is given to the team on how to implement ERP
system. In the training, company trains its employees to implement and later run the system.
The ERP vendors and consultants will leave after the implementation of ERP system is over.
After this company is self-sufficient in running the ERP system and company’s good
in house team con handle the various situation & knows the importance of selecting right
employees with good attitude i.e. willing to change, learn new things and not afraid of
technology and good functional knowledge.

4. Testing:
This is the phase where you try to test and break the system. Here we will try to
test the system with real case scenarios like- system overloads, multiple users logging on at the
same time with the same query, users entering invalid data, hackers trying to access restricted
areas and so on.
Test case should be designed in such a way that it can identify the weak links in the
system. All the problems should be fixed before living.

5. Going live-
In this phase ERP is made available for all and for the entire organization. The
technical side is almost complete, database is ready and running on the functional side the
model is fully configured and tested and ready to go operational.
Once the system is ‘live’ the old system is removed and the new system is used for
doing business.

6. End-user training:
In this phase the actual users are given training how to use the system. The phase
starts much before the system goes live. The employees who are going to use the ERP system
are identified, their current skills are noted and they are divided into groups. Each group is
given training on the new system. This training is very important for the ERP System
because the most successful implementation ERP packages fail due to lack of end user training.

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 This training section gives the overall view of the system and how the individual
actions will be perform & also addressing the new technologies. This phase is important
because the success of an ERP system spends upon it and this phase is equally difficult than the
implementation tem training.

7. Post implementation/operation and maintain-

This post implementation phase is the most important phase and critical also. Once
the implementation is over the vendors and the hired consultants will go to get full benefit from
the ERP system. It should get enterprise wide acceptance. There should be sufficient employees
who are trained to handle problem that might arise after implementation. People also required
who has technical knowledge that can make necessary enhancement to the system when ever
required.
The system must be upgraded as and when new versions or new technologies are
introduced. The training will never end, it is an ongoing process, new people will always be
coming in and new functionality will always be entering the organization.

Objectives of ERP implementation

a. Speed: Speed of ERP system is directly related to time used for implementation or ERP
System
b. Scope: Scope of project is functional and technical features that the company wants to
implement.
c. Resources: Resources includes hardware systems human resource. Software system technical
support and consultants.
d. Risk: The risk of a project is a factor which affects the overall success of ERP
implementation.
e. Complexity- meaning of complexity here is level of difficulty in implementation operating
and maintaining the ERP system

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f. Benefits: To get the maximum benefit out of an ERP implementation the software should be
built according to the software development process and all organizational needs.