Large, complex, high-cost enterprise-wide projects are often avoided by managers for fear of failure. No one wanted to go to the Board of Directors to request the funding without sound business justification. Until the system outage occurred, it would have been more challenging to develop a compelling business case to replace all systems and spend $15 million doing so. Essentially, managers are afraid to take the risk to lead a multi-million dollar project because if they fail, they can lose their jobs. But, if they succeed, there is enterprise-wide recognition and opportunities for career advancement.
Give a “laundry list” of best practices (five to seven of them should be sufficient) for managing an ERP implementation, as demonstrated by Cisco in this case. Briefly elaborate each item on the list. 1. Partnering with a consulting firm like KPMG who has experience in the selecting, customizing, and implementing enterprise resource planning (ERP) software. Without expert help, internal resources are subject to making mistakes that result in impacts to the project timeline, budget, and quality of the system being implemented.
Leveraging best practices and lesson learned from KPMG, a firm with expertise in this area, was an excellent decision. 2. ERP vendor selection process and criteria: a. Consulting with the big six accounting firms for the opinions on effective ERP systems. Customer testimonials and references from existing customers is invaluable. This provides evidence of the effectiveness of the system and provides insight into the quality of customer support provided by the vendor. b. Leveraging research conducted by one of the world’s leading technology and advisory companies, Gartner, Inc.
Their research is reliable and specific to leading edge technology. It provides a side-by-side feature comparison of all the leading ERP systems and the companies who use them. This research data is expensive but it provides valuable insights that can help managers make decisions that will help them to save money and gain a competitive advantage in the future. I have personally used Gartner research data in my decision making and it has been a valuable tool and it makes it easier to provide business justification to senior management when requesting project and funding approvals. . Requiring the vendor to demonstrate their software using Cisco sample data over the course of three days; oftentimes, vendor demonstrate using their own data or another client’s data (with their permission of course) but this does not prove that the unique requirements of another client will be supported. d. The following criterion provide additional synergies will reduce risks and contribute to a successful implementation:
i. Similar in size ii. Close in proximity iii. Manufacturing capabilities iv. Scalability for long term needs . Motivated to succeed vi. Lower cost in exchange for providing customer testimonials and access to facilities to acquire new customers 3. Preparation for the Board of Directors presentation and request for project approval and funding. Partnered with the both vendors, KPMG and Oracle to anticipate the board’s questions and concerns and proactively prepared to address those questions. They already knew how much it would cost and how long it would take and what the consequences might be if no action was taken. . Top company priority, communication plan, and subject matter experts were keys to a successful customization and implementation. e. Designated this ERP project as one of the top 7 company priorities and communicated this to the entire company. f. Created a cross-functional project team consisting of “the best and the brightest” in the company Oftentimes, these mission critical projects are done behind the scenes and the right people or not engaged.
I’ve seen high priority, high visibility projects staffed with 100% managers but these managers are not close enough to the work to enable them to give the level of detailed information required to configure and/or customize system that meets the needs of the entire user community. 5. Rapid iterative prototyping is an approach that works wells by speeding up development and checking in with functional users to ensure requirements were accurately interpreted.
6. Project management best practices: g. Managing scope creep vii. Focusing on 80% of the requirements viii. Implementing an Executive Steering Committee to approve requirements and change / modification requests h. Issue management processing were effective; tracking issues and bugs and resolving them in a timely manner is critical to the success of any project. i. Fast tracking every phase and stage of the project prevented them from “over analyzing” requirements and belaboring decisions
7.Decision to not make any changes to the core application code to avoid complications with upgrading the software with new releases in the future was another great decision. Off the shelf systems are continuously improved over time, sometimes every year or every other year. If they want to maintain scalability for the long term, they must leave the core application code intact. This will also help them to avoid costly upgrades and possible prolonged system outages during the cutover periods associated with these upgrades.