Corporate Systems as a Strategic Growth Initiative
Over the past decade, it is known as Enterprise Systems or ERP that it is widespread in most large companies. Such as the rapid growth of ERP since the end of the 1990s, one of the largest software vendors among the largest software vendors in developing and selling Enterprise Application packages, and seems to be growing steadily. Today, Enterprise Systems not only includes software that enables the organization to do business, but also includes a number of industry-wide business functions in packages that ensure that you do not need to make too many customizations to run your business. make it suitable. This verticalisation helps organizations to implement the system faster and provides too much help to growing organizations by providing a process for business processes.
One particular advantage of using Enterprise System is that it provides an integrated solution for the entire enterprise. Typically, at the beginning of the cycle, IT-approved organizations would have been the best solutions for specific business needs, such as accounting or inventory management solutions, but that meet the needs of each process and cannot communicate with systems that work in other processes. the same organization. Thus, the organization is linked to multiple and different systems. Larger organizations using information technology initially built sophisticated software models according to their own needs, with the understanding that the process will not change, so build software that fits the process. Not only are these custom-built applications difficult to manage, but they also pose specific challenges for upgrading or adapting the latest technology standards. ERP, on the other hand, not only provides a comprehensive integrated solution for all aspects of business, but also for the development of changing technologies. These update paths are usually defined by the Enterprise Systems vendor.
Another special feature of the ERP package is that most of the standard business functions and operational processes are embedded in the software code, thus reducing the time needed to understand software process issues and standardizing the organization. processes that allow the organization to apply industry best practices more quickly. But the advantage of ERP is that some problems with ERP initiatives are starting.
It is important for the head of the organization to understand that the ERP package not only targets the automation of business functions, but also forces its own logic into the business. This may have consequences for resistance from functional leaders who have developed a certain process for a few years and are now being asked to change the organization's catastrophic results because it cannot use the implemented corporate system because it cannot change its process Egypt accepts built into software. Because the system provides a standardization process for business, and most organizations typically use the same Enterprise system in the same industry and similar product, how to maintain strategic discrimination. What will happen to the carefully constructed processes that have been nurtured and secretly guarded so that the company can gain a competitive edge through the Enterprise System.
From the point of view of the management of organizations, it is to be understood that the implementation of ERP is not a technology initiative but a strategic initiative that changes the way the organization operates. Consequently, it is important that the ERP Implementation Initiative at Executive level provide executive sponsorship and take part in business unit managers and not be the initiative of the company's IT team.
Some Important Issues Immediately:
What are the top managers or business unit leaders who are expected to contribute to the ERP implementation initiative?
Should managers only use budget support and review progress, or will implementation time be more useful to ensure the success of the ERP initiative?
What specific decisions or processes help make the right decisions for the success of the initiative?
The rest of the article discusses areas with which the sponsor should be involved to ensure that the ERP initiative goes well
ERP Standby Assessment:
ERP Standby Assessment Process is to understand if the organization is ready for an ERP implementation initiative. As we have pointed out earlier, this is not a technical assessment of the preparedness of organizations, although they have some aspects. This evaluation approaches the ERP as a strategic initiative.
The initial ERP standby test should use both qualitative information on the organization for general dimensions if it affects all parts of the organization and its stakeholders. Quality information helps to evaluate the organisation's skills in full ERP implementation and understands the various shortcomings that the organization must identify before joining the ERP initiative. Some of the dimensions that need to be considered are:
1. Organizational Vision
2. Structure, Hierachy and Work Culture
3. Current Business Processes and Process Expiration
4. Goals and Objectives of Using Information Technology
5. Current state of the IT infrastructure
This first assessment should not affect specific functional areas such as Finance and Accounting or Sales and Receivables, as the purpose is not to provide information on how the process is managed, and there is no need to specifically look at what type of technology or package to use to implement ERP. This evaluation through an internal or external consultant is useful for mid-market organizations that need to assess their readiness for internal ERP implementation and analyze the shortcomings of their ERP initiative approach under the current organizational condition. The recommendation may seek specific criteria for the implementation of the ERP or may decide to organize the implementation of the ERP for specific organizational initiatives.
Go-Ahead Decision on an ERP Initiative
After examining whether an organization is ready to accept a full ERP initiative, it's time to make a decisive decision on the next step : ERP Initiative. In medium-sized organizations, as ownership patterns are typically different from large global companies, decisions are expected to be much faster. The Executive Team's decision to go to Ah-Ahead together with the implementation of ERP includes the following criteria.
Publication of ERP and IT Initiatives
ERP implementation will be a critical part of all IT initiatives in an organization. For medium-sized businesses, IT spending over 1% of annual revenue is considered to be progressive. For the financial year when you run ERP pacakage, you can reach up to 3% of your annual revenue. This is a crucial decision, so it is important to involve the CFO / financial manager.
Processes in the ERP Initiative
To do this, one has to critically evaluate the essence of business activity and process dependence. Note that processes are covered by another inherited application. Understanding the processes covered by the ERP initiative will also help in the package and supplier assessment that we will discuss in the next phase.
Whether you use an IT application or not, it is a fact that ERP implementation changes the way you do business. The most critical impact concerns the processes covered by ERP. The typical way to change the effects of change and change processes is to involve key business process managers. But in many cases, managers themselves cannot be the actual users of the system, and therefore the key user involvement of the system's after-care is crucial. Another aspect of the impact of change is the replacement of personnel or the redeployment of staff in key processes.
Organizing the Internal Group of the Initiative
It is normal that ERP implementation is sponsored by an executive member at the CxO level of the organization and led by a senior IT manager. But besides the sponsor and the project leader, a large team has to be set up to ensure that implementation covers all aspects of the organization's business. The most important members of this team are the leading accountants who not only consider the costs, but also the impact of the various processes and their changes on the finances of the company and HR manager, taking into account the necessary finances. encouraging organizational change and restructuring, key executives and staff as part of ERP implementation, either full time or as a further responsibility.
Managers managing key functional areas or business processes are core members of the team. One problem will be that managers in a given functional area are not often the users of the system and thus make little contribution to the initiative. We recommend that key employees who know the processes very well and have adequate adaptability as part of a full-time team often consider the team a reward.
ERI's ROI is a very tricky task that most IT executives and ERP carriers tend to get used to. In some larger organizations, the growing view today is that ERP is an essential part of the organisation's infrastructure costs, and there is no reason to assess the return on investment, as well as to evaluate the ROIs and facilities they use. your company. The reason why the return on investment is complicated and difficult is the large number of intangible benefits gained through simplified processes, better access to information and competitive advantages, and the required data takes months. The costs to be taken into account in the ROI assessment are not only the licensing costs and implementation costs of the system, but also the training costs, the internal costs of the internal team and the support costs. Acquired revenue benefits can be directly quantified based on cost reductions or productivity improvements, such as staff cuts or paperwork that can be easily measured, or improved opportunities for future accruals, such as better time to market. products or the improvement of manufacturing practices.
It is to be understood that ERP changes business mode and therefore risks are not business risks but business risks. They can interfere with operations and pay a lot of time for losing time and opportunity. The executive team should have risk assessment and risk reduction strategies planned. This may include organizational issues such as new staff training for the new system, reorganization of the organization due to ongoing changes, or the availability and availability of critical critical systems.
Package Assessment and Selection:
The success of ERP implementation in the short term and in the future depends largely on the selection of applicable Enterprise Systems packages. Although it is always an attractive proposition to incorporate the best brand names in Enterprise Systems, the decision should be based on the compliance of the business and business strategic goals of the package.
Some Questions to Answer
Does the Enterprise Systems Vendor's financial strength and long-term goals meet the company's expectations?
It is important for the seller to support the implemented package in the future, as well as problems with updating and migration if the ERP vendor could not support the system or still sells another Enterprise Systems company. .
How Easy Is It To Use The System?
This affects the acceptance of the system by employees and the cost of training.
What features and features does the product have?
Here you will have to analyze in detail what the product offers to your organization.
One size does not fit everything and the same process. So although standard processes can be used, it is necessary for these processes to be customizable for the enterprise to achieve the distinctive benefits, the software package must allow the package to be customized and polished to suit your business.
What is the cost of procurement, implementation, support and upgrading?
What are the prior art implementations?
Do you use the latest technologies such as Web Services, SOAP, etc.?
If it starts from scratch, the packet evaluation process is not only critical to the overall implementation, but the other bases of the ERP implementation initiative. This requires not only careful planning and research, but also extensive professional support from outside consultants specialized in this field. Depending on the size of the organization and the nature of the final outcome, the process may take 6 to 6 months, depending on the documentation of the assessment criteria up to the selection and purchase of the appropriate corporate system.
Execution Partner Selection Process:
Seller selection can be done in tandem or later than the packet selection process. It may be recommended by the package vendor or based on your own independent assessment. In some cases, the implementation partner may first be selected based on the expertise and knowledge of Enterprise Systems and may participate in the package selection process.
Some Important Considerations to Consider When Costing and Deploying Business Systems:
What experience do you have in the vertical or business sector, will you be able to understand business issues?
What are the profiles of consultants, analysts or technicians who are ready to implement?
What are the nature of the services and services offered by the implementing partner?
What were your past achievements in implementing projects?
What guarantees, risk reduction plans, and business continuity assurances are they offering?
Goes through a proper stand-by assessment after making the right decision and selecting the corporate system and the executive partner. The organization is now on track to start implementing ERP. Time and patience are needed to make the right decisions, and management time must be willing to make the ERP a success.