At most companies, operations management would admit that the use of business software, such as ERP (enterprise resource planning), could be improved.
But how - and when? To determine those answers, these questions may be considered:
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Can existing ERP software be further improved to meet current needs? Or are there enough deficiencies to defend implementing new ERP software?
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Should some fixes be implemented now - and some later? Or is the solution in some combination of these choices?
Without the confidence of a well-crafted ERP software strategy, companies tend to react to problems and let these events ineffectively drive ERP software change.
Developing an ERP Strategy Plan
This exercise, and resultant plan, is designed to improve confidence on whether a company should improve existing ERP or implement new ERP. The following are the comparison factors of the two major options:
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Projected benefits
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Estimated costs
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Risk assessment
The ERP Software Strategy Planning Process
1. Education: Ensure your team understands the following which will improve their ability to participate in all aspects of the ERP strategy planning exercise.
- Current status of the ERP market
- Attributes of a modernized ERP and the general benefits to users
- Techniques to control ERP implementation projects to manage risk and achieve better results
2. Status of your company: Discuss potential major changes in your company size, acquisitions, new products, manufacturing techniques, distribution, international business, and industry trends. This 'forward-looking' discussion is followed by interviews in selected process areas and business units with a focus on current process problems, improvement ideas, and what processes are considered somewhat specific to your company and/or its industry.
3. Current IT software/hardware/infrastructure status: Assess and discuss current or pending obsolescence and/or technical limitations of currently used ERP (software and vendor) and software integrated to ERP as well as ERP related IT hardware, infrastructure, middleware/utility software products/vendors.
4. Develop ERP strategy: Using the findings from previous steps,
- Interview current provider and two best-in-class ERP for ability to meet key objectives determined in step #2.
- Develop the ERP project cost estimates for (1) improving current ERP, and (2) implementing new ERP.
- Establish the ERP business process boundary diagram (see sample below).
- Roll up all findings to show the differences of improving existing ERP and upgradin