ERP Project SuccessYour keys to a successful project

1Mike Knapp, Incrementa ConsultingEmail: Mknapp@Incrementa.caPhone: 604.259.6170 ext 106

About Incrementa Consulting

We are a unique multidisciplinary team of experts, brought together by a shared passion for helping

businesses be successful.

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What ERP can do for you

• The value proposition of ERP systems is massive

• A well-implemented ERP can:

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Remove communication silos Streamline manufacturing

Reduce inventory Improve productivity

Improve cash flow Understand actual costs

Add visibility for sales Shorten lead times

Improve availability and accuracy of information

Help you make better decisions

Failure is not an Option

• Implementing an ERP is a high risk project

• It entails major changes in all areas of a business

• It takes a lot of time, money and focus

• If you’re going to undertake an ERP project, you can’t afford to fail

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Failures Abound

• Reports of ERP success rates vary dramatically• 58% Success, 21% “I don’t know”, 21% Failure –

Panorama Consulting 2015

• 55%-75% Failure – Gartner

• According to Panorama Consulting• 61% take longer than expected

• 53% exceed budget

• 60% realize less than 50% of the expected benefits

• Satisfaction levels also poor• 73.8% of all manufacturers are

dissatisfied with their current ERP - WSJ

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Why Did They Fail?

6Source: How to Avoid ERP Failure, Software Advice

How do we not become another statistic?

Change our Perspective

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• Drop the term ERP (and the baggage)

• Think of it as a company-wide project that will impact:• Everyone in the business

• Almost every business process

• It’s not an IT project

If we’re going to run a major project, what do we need to be successful?

Key Skills for Project Success

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Leadership

Requirements Analysis

Project Management

Change Management

Leadership

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• Who are the project leaders?

• How will you run the project?

• How are decisions made?

• What does good look like?

Reasons for Failure

Poor Governance 32%

Governance

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• Who are the project leaders?• Use a Steering Committee

• Include subject matter experts from different areas

• How will you run the project?

• How are decisions made?• Scope changes

• Signoff of tasks/implementation phases

Know When You’re Successful

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• Define clear metrics for success• “On time and on budget” are NOT good metrics!

• Consider things that bring value to the business• Lower inventory levels from X to Y

• Reduce the time to create a quote from X to Y

• Reduce data entry errors in process XYZ

Change Management

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• What is Change Management?

• Who are the Stakeholders?

• Get buy-in at the Start

• Communicate Early and Often

• Pacing Changes

• Manage Resistance

• Training

• The New Normal

• Celebrate Victories Reasons for Failure

Poor Change Management 50%

Activity

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What is Change Management

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“Change management is an approach to transitioning individuals, teams, and organizations from a current state to a desired future state.

It is an organizational process aimed at helping change stakeholders to accept and embrace changes in their business environment.” – Wikipedia

Mike’s version:

It’s the process of managing the squishy stuff - the people part of the project. It’s also the most important part.

Stakeholders

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• Ask yourself: Who will be impacted by this change?• These are the stakeholders

• Even if the project is successful, true success depends on the stakeholders buying in

Getting Engagement and Buy-in

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• Involve as many people as possible from the start• Leverage expertise in the Requirements Analysis phase

• Understand everyone’s pain points and bottlenecks

• Make them part of the solution

“People hate change, but they love progress” – Donald S Pottruck

(OVER) Communicate

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• Communicate with all stakeholders regularly• Town Hall meetings are a great way to start

• Communications should build excitement for the change• Focus on the benefits

• Be positive

• Be clear about• Why the change is happening

• How people will be affected

• When it will happen

Set a Good Pace

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• People can’t be sprinting all the time

• It takes time to absorb changes

• Pacing is like surfing waves• Too big and fast, surfers get knocked down

• Too small and slow, surfers get bored and move on

Managing Resistance

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• There will always be … resistors• Listen. Listen. Listen.

• Ask questions to help them define good (for them)

• Find ways to help them be part of the change

• Break down the resistance in positive ways

Training

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• Consider timing carefully• Not too early – people will forget

• You can’t do too much training• Use real-world scenarios and data

• Should be hands-on

• Training should always be a positive experience

Making the Change the new Norm

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• How many projects fizzle after implementation?

• Measure change. Make it tangible.• Remember “What good looks like?”

• Reinforce changes

• Engage stakeholders after the project• Did it solve their issues

• How can it be more successful

• Develop a culture of continuous improvement

Celebrate Victories (even small ones)

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• Celebrate victories often

• Build confidence through little wins

• Give people the chance to breathe between sprints

Tools

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• Articles and change models• https://www.mindtools.com/pages/article/newPPM_87.htm

• The ADKAR model• Certification is available from Prosci

• http://adpro.ca/public-programs/Prosci-Program-Description

• The Incrementa team• Joel and Erica are Change Management experts

Requirements Analysis

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• Understand your needs• Current state and future state

• Vendor-led detailed analysis

• Sign-off from all subject matter experts

Reasons for Failure

InsufficientFunctionality 36%

Activity

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Video is available at: http://www.theinvisiblegorilla.com/videos.html

Understand Your Needs

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• Create process maps for all major processes• Hint: Get the whole team involved to create buy-in

• Present and desired state

• Job shadowing

• Capture everyone’s issues

• Good opportunity to get clear metrics

Vendor-led Detailed Analysis

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• Make the vendor do their own detailed analysis

• Vendor documents the requirements thoroughly

• Hint: Do this before buying the software• Sets clear scope with your vendor

• Ensures they fully understand your needs

• There may be a fee associated

Sign Off on Requirements

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• Sign off process ensures there’s accountability

• Review by stakeholders (if possible)

• Who signs off that the requirements are accurate? • Depends on the project leadership

• Generally the subject matter experts for each area

Project Management

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• Resourcing

• Scope Management

• Task Management

• Test Planning

Reasons for Failure

Behind Schedule 27%

Over Budget 23%

Resourcing

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• In an ERP Project:• Expect to do most of the work

• The vendor configures the software

• The customer puts their data in, tests and validates

• Grow your project leader in house• They will become the expert

• 25%+ time for the in house project leader

• 25-40% time for the subject matter experts

Scope Management

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• The detailed design is your scope

• Changes to that scope must be documented and approved• May increase budget / timeline

• Consider pushing changes / improvements to future phases

Task Management

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• There can be 500+ tasks during the implementation

• Who tracks every detail? • Your project manager

• Use the right tools for the job• Does the vendor provide tools?

Office 365 Planner(Q1 2015)

Testing

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• One of the most important phases of any project

• Training is NOT testing• Testing comes first• End users should not test – finding issues reduces confidence

• Use real-world scenarios to test all requirements

• More sweat in this phase means less pain at implementation

Implementation and Go Live

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• Expect the best, but plan for the worst• Major projects usually have some issues at launch

• Use the key skills to work through them

Are you ready for ERP project success?