ERP Implementation

Project
DR. DJAMAL ZIANI
 Projects from
another
perspective

According to a 2017 report from

the Project Management Institute
(PMI), 14 % of IT projects fail.

However, 31 % didn’t meet their

goals, 43 % exceeded their initial
budgets, and 49 % were late.

Source: [Link]
/media/pmi/documents/public/pdf/learning/thoug
ht-leadership/pulse/pulse-of-the-profession-
[Link]?sc_lang_temp=en
Projects from another perspective-ERP Failure

Source 2019: [Link]

On Premise ERP
Implementation
Cost
Type of Enterprise Cost
* Statistics of 2017:
[Link] Small Business $ 5,000 – $ 50,000
implementation-cost/
Small – Medium Business $ 50,000 – $ 500,000

Medium Business – $ 500,000 – $ 2

Enterprise millions
On Premise ERP
Implementation
Cost
Source:
[Link]
implementation-cost/
On Premise ERP Implementation cost

Software 24.2% Hardware 17.8% Consulting

–30.2% –18.5% 24.1% –30.1%

Implementation
Training 10.9% –
team 12.0% –
13.8%
13.6%
On Premise ERP Implementation cost

The cost of maintaining an ERP often exceeds the cost of initial implementation. Businesses
evolve, open new units and acquire new trading partners, or may outsource some work.

Yearly, the cost of ERP maintenance is typically 15% – 20% of the investment in an ERP solution.

So, if your implementation cost is $500,000 price, the annual support for it would be
about $75,000. To minimize those costs, expert tips are the following:

 Plan and implement your ERP better

 Exclude unnecessary licenses
 Reduce hardware updates with cloud solutions
 Hire service provider and reduce your own IT management
ERP Cloud

 See this video: What is Cloud ERP?

 Reduce significantly IT resource

 Not need for big budget

 Pay by Month by user

 Company focus on their real business

 Scalability: refers to the ability to increase or decrease IT resources as needed to

meet changing demand.
ERP Implementation Trends-Cloud
 61% of UK CIOs store over half of their ERP data on the cloud. However, only
6% of these intend to go exclusively cloud-based in the next 3 to 5 years.

 In terms of ERP deployment, 51% of UK CIOs prefer private cloud, 35% prefer
on-premise, and 10% prefer hybrid solutions.

Source: [Link]
A Data Center can
handle many
private clouds

A cloud is a virtual space

on the world wide web
where your Data is stored or
processed.
The data is stored on IT
devices that may be
located anywhere on the
WWW.
Public, Private, Community, Cloud
Public, Private, Community, Cloud
 Public clouds are the most common type of cloud computing deployment. The cloud resources
(like servers and storage) are owned and operated by a third-party cloud service provider and
delivered over the Internet.

 Share the same hardware, storage and network devices with other organizations “tenants”

 Advantages of public clouds:

• Lower costs

• No maintenance

• Near-unlimited scalability

• High reliability
Public, Private, Community, Cloud
 A private cloud used exclusively by one business or organisation.

 The private cloud can be physically located at your organization's on-site data center, or it can
be hosted by a third-party service provider.

 The services and infrastructure are always maintained on a private network and the hardware
and software are dedicated solely to your organization.

 Advantages of private clouds:

• More flexibility – your organization can customize its cloud environment to meet specific business
needs.

• More control – resources are not shared with others, so higher levels of control and privacy are
possible.

• More scalability – private clouds often offer more scalability compared to on-premises infrastructure.
ERP Implementation Trends-
Cloud

 73% of companies have at least one

application already in the cloud. Another
17% plan to do the same in 2019.

 42% of businesses are using multi-

cloud.

 22% of organizations use on-premise

ERP but are looking for managed
hosting/IaaS (Infrastructure as a
Service).
ERP Implementation Trends
Usage of ERP Software

15%
SaaS ERP

Cloud ERP
21%
On-premise ERP
64%

Source: 2018 Panorama Consulting Solutions

ERP Cloud vs Saas ERP
 Cloud ERP is a customer ERP software runs on a provider's cloud computing
platform, rather than on premises in an enterprise's own data center.

 SaaS (Software-as-a-Service) ERP model offerings are typically smaller. This is

normally best for organizations with limited complexity, size and global presence. ERP
system providers host SaaS model on their own infrastructures instead of locating the
systems on-premise at the purchasing organization.

 In SaaS model, the vendor will have the full control of the application and not the
customer, where as in Cloud ERP system your data and your application can be
placed on server that you control.
ERP Cloud
Source:
[Link]
/resources/erp-software-pricing/
 ERP Cloud

Source:
[Link]
urces/erp-software-pricing/
 See this video, and lets
have a discussion after:
The Dark Side of Cloud ERP
and SaaS Software
ERP Implementation
ERP Implementation : Steps Before
1. Carefully evaluate your options before selecting your ERP system

What do you want to be able to do from the system? Is this possible via the existing.

Does the ERP solution will work with your existing ?

2. Get Top management support

3. Define Scope of Implementation and End Objectives

4. ERP strategy

Indicates what kind of ERP packages would be purchased and how long is the
implementation process

5. Select ERP System

ERP Implementation : Select ERP System
How to choose an ERP system?

1. List your constraints: Budget, Time, Security, Integration,..

2. Create a feature/function list.
3. Create a software candidate list.
4. Narrow the field to four to six serious candidates.
5. Create the request for proposal (RFP).
6. Select two or three finalists.
7. Have the finalists demonstrate their packages.
8. Select the winner.
9. Negotiate the contract.
Choosing the Best ERP for Your Business

 It is not easy task to choose the right ERP system to your organization.

 The market contains hundreds of different ERP solutions

 Many criteria should be taken into consideration:

 Features
 Budget
 Technology
 Integration
 Scalability
1. Choosing the Best ERP for Your Business- Software
Functionalities and Features
 Does ERP has the modules and features your business needs?

 Your ERP system’s features should work for your business — you don’t want to
adapt your business practice to the ERP software’s features.

 Select the ERP with robust module for your main business focus: for instance, If
financial services are a strong priority, make sure the ERP system you choose has
robust accounting module.

 More gap you have between the company requirements and the ERP features,
more customizing the company should do (increasing implementation budget, and
increase risk of implementation failure).
2. Choosing the Best ERP for Your Business- Budget &
Cost
 What budget is allocated to your ERP implementation?

 Based on your Budget select the right implementation strategy : on Premise, Public
Cloud, Private Cloud.

 Calculate carefully the ERP Cost. Add the maintenance and customizing cost

 A high cost doesn’t necessarily imply a high value. If expensive ERP software contains
numerous features you won’t use, its value for your operations will be relatively low.
3. Choosing the Best ERP for Your Business-Business Needs

 Select a System that tightly fit your business needs

 The more customization needed, the longer it will take to roll the software
out and the more it will cost to keep it up to date.

 An ERP system that comes with a pre-defined “reference model” to reflect

the new customers functional style and business practice may be
preferable to others that do not come with reference models.

 Custom modification may be an option to reduce the gap between the system
capability and the business practice. But on the other hand, too much modification
leads to a complex system difficult to support and virtually impossible to upgrade to
the newest version of the software.
4. Choosing the Best ERP for Your Business-Integration
 Most advanced ERP software won’t help you if it can’t send and receive
data to other software of your organization.

 Does the ERP system has a secure and well designed integration with all
or most of softwares of your company?

 Can the ERP system use any database?

 What type of integration is: Point-to-Point Integrations, Enterprise Service

Bus (ESB), Integration Platform as a Service (iPaaS), ... ?

 Does the ERP System allow to add Custom Integration Applications?

 Does the ERP System be used as Postmodern ERP Solution?

SAP Data Dictionary: Virtual Database

 Data Dictionary is a persistent

repository of metadata which is
used to define different data
objects that are used in SAP
business applications.

 It is a virtual database

2
8
SAP Hana Database

2
9
 Finding best-of-breed solutions to replace individual
applications within larger ERP suites.
For example, an organization might prefer to use a more
robust industry-standard CRM system, such as Salesforce
(which can integrate with most major ERP suites), instead of
the CRM application bundled with their ERP system.

Postmodern
ERP
5- Choosing the Best ERP for Your Business- The
Future
 Select the ERP vendors that make the technology

 Select the ERP systems open for customizing, not close box ERP.

 Make sure that ERP vendor has agreement for futur upgrades
ERP Implementation : Steps During
1. Create the Project plan: Staffing, Timing, Testing, Cutover

2. Build change management and Communication plan

3. Business Analysis and Reengineering

4. Execution: Configuration, Customizing, Testing

5. Data Migration

6. Integration with existing systems

7. Training

8. Go-Live

9. Support & Maintenance

Change Management:

o User resistance has been associated with almost any type of system change. For ERP
the resistance is more important.

o The main resistance is because the users are worried that their job might be eliminated
or be changed from their usual way of doing things.

o Most of time there is low productivity after BPR process.

o Changes in staff relationships: Some employees may need to create new working
relationships, new information sharing among departments, assume additional
responsibilities. This can lead to resistance and fear. Therefore, managers’ soft skills
(communication and team building skills) are required for a successful implementation.

o Participation
and involvement of users during the implementation is encouraged to
ensure that user requirements are met, to gain user commitment, and to avoid user
resistance.
Cutover: Stopping the old system and begin to work with the new
system.

Different strategies:
o The “big bang” cutover: Build the migration architecture and then move the data to
the new system in one process. Stop the old system, and start the new system.

o The incremental cutover: This approach reduces the risk of a big bang approach by
only migrating discrete parts of the business and associated data. If it is successful
another part will be migrated, and so on.

oThe parallel cutover: we simply move the data to the target environment but ensure
the data in each system is still current. This typically involves keeping the two systems,
or use some other form of data synchronization.

o Pilot cutover: if a company has many branches, we select a branch to be the pilot for
the cutover, and when the go live is working well, we can conduct a cutover to one or all
branches.
Question

Is ERP Implementation easy to

do?
Some ERP Implementation methodologies

Total Solution Fast Track Oracle Business

(Ernst & Young, (Deloitte & Accelerators
LLP) Touche) (OBA)

Business
Accelerated IBM Innovation Integration
SAP (ASAP) Implementation Methodology
(Accenture)
ASAP
Methodology-
Phases
Phase 1 : Project Preparation
Goal Setting
Define project goals & objectives

The purpose of this phase is to provide initial

Implementation strategy
[Link] the scope of implementation
planning and preparation for your SAP project.
[Link] the project organization and Although each SAP project has its own unique
relevant committees and assign
resources
objectives, scope, and priorities; the steps in
Phase 1 help you to identify and plan the
primary focus areas that need to be
Implementation Sequence
Define sequence in project has to be considered.
executed

Team
Core team+ project team+
consultant team

Sign Off
At the end of phase every above steps
will be documented & will be signed off
with the client
Phase 2 : Business Blueprint
SCOPE DOCUMENT
This document will consists of
questionnaire of entire business
process
The purpose of this phase is to create the Business
Blueprint, which is detailed documentation of the
AS IS results gathered during requirements workshops.
[Link] the business Process
from the core team. [Link] on the Furthermore, the Business Blueprint documents the
input ASIS document has to be created business process requirements of the company. With
according to module wise
this, you can better understand how the company
intends to run its business within the SAP System
TO BE
[Link] this process will map the business
process in SAP based on ASIS
[Link] wise TOBE document has to
be created

GAP ANALYSIS
[Link] GAP b/w ASIS process & TOBE process
is called GAP analysis ie., The inputs or the
business process which can’t mapped into
standard SAP will be analyzed here
[Link] document has to be created

SIGN OFF
Each process above has to be
taken sign off from client
Phase 3 : Realization
Baseline
Major scope The purpose of this phase is to implement business
and process requirements based on the Business
Blueprint. The objectives are final implementation in the
system, an overall test, and the release of the system
for production (live) operation. In addition, the project
Final Configuration team receives relevant knowledge.
Remaining scope

SIGN OFF
Each process above has to be
taken sign off from client

Base line configuration is the process of configuring the SAP system as per the Blue Print for the Standard
functionalities.

Final Configuration phase involves the activities like

- Enhancements (userexits etc.,)

- Preparation of Custom Reports as per the user requirements
- Authorizations
Phase 4 : Final Preparation
Unit Testing
Testing within each module
The purpose of this phase is to complete
the final preparation (including testing,
Integration Testing end user training, system management
Integrate testing of modules ie., and cutover activities) to finalize your
combine testing of all the readiness to go live. The Final Preparation
modules phase also serves to resolve all critical
open issues. On successful completion of
this phase, you are ready to run your
User Training business in your live SAP System.

Cut over Strategy

legacy system will be migrated to
SAP system.

SIGN OFF
Each process above has to be
taken sign off from client
Phase 5 : Go Live & Support

Production Support
The purpose of this phase is to
move from a project-oriented, pre-
production environment to live
Monitor System production operation.
Transactions

Optimize Performance

Help Desk &

Competency Center
Question

Is there any critical timing that you

should avoid to go live?
Video-10 Tips for successful implementation

Ten Tips for Successful ERP

Implementation
Video Transcript-10 Tips for successful
implementation
1. Define Your Desired Results Kapil Mishra "One of the key risks that customers face in implementing
ERP systems is not being able to make an impact on the business bottom line", Steve Weaver "When you
are purchasing a new ERP system you need to understand your business, what you do, what you
want to achieve, what your processes are, not what you necessarily do today but also where you want to
go to what you ultimately want to be and what ultimately want to achieve".

2. Don't Automatically Reuse Old Workflows Steve Weaver "Many people will buy a new ERP system
without understanding their business and what they are effectively doing is spending an awful lot of money
to replace a like for like system.

3. Map All of Your Business Processes Kapil Mishra "It boils down to building a solid business case right
in the beginning being very clear as to what are the bottlenecks in the processes, what are the areas that
are a challenge today and which specific areas of the business need to be impacted. This is really a
blueprint that should be in place before you start thinking about the IT component of the ERP
implementation." Steve Weaver "They need to map their business processes, they need to get the
business stakeholders, the end users into rooms to document what they do and as importantly question
why they do things."
Video Transcript-10 Tips for successful
implementation
4. Ensure you have a long term plan for your solution Chris Mean "The best customers that we work with
are the ones that think ahead and plan ahead. And plan in optimization stages where together we can partner
how to then drive their business forward after initial go live."

5. Make sure you have executive level sponsorship Brian Blood "Constant involvement of senior
executives during the project process helps to mitigate the risk of architecting processes in the overall
solution that are counter intuitive to the company's overall strategy."

6. Assemble the right project team Chris Braisby "One of the big problems that we often face on projects is
that when we are assembling a project team and the customer is putting that project team together then they
often put the team that is available, the people that they can most easily spare and not the key people, the
key decision makers in the organization who can understand all the issues, understand where their
weaknesses are and also where their current strengths are."

7. Try to standardize and avoid developments Chris Mean "A common reason why an ERP implementation
project might fail is that too many developments are identified and approved by the customer. We work very
strongly with our customer to try and minimize those developments and one of the techniques you can use is
to ensure you have strong board sponsorship about the direction of the project and you have good buy in
from the key users about adopting a new solution"
Video Transcript-10 Tips for successful
implementation
8. Make user training a priority Steve Weaver "Training your core team and training the end users on the
ultimate software you are going to use is a necessity. It is generally towards the end of a project and many
businesses set a go live date and the part that gets crushed in the timescales is the training and the end user
exposure to the system, so the more investment you can make time wise in training ultimately leads to a
better go live.

9. Focus on getting the right data into the system Martin Clothier "The key things for data migration are
start early, there are no magic bullets, define the migration as a separate project and chose the right people in
the business to own the data and test, test and test again as part of user acceptance testing and good data
management doesn't stop after go live, it's an ongoing process that needs to be defined."

10. Select the right partner and solution Chris Mean "Choosing the right solution and the right partner for
the implementation is key. Often you see people choosing a solution based on cost or even the partner based
on cost as well and I think it is important to think how does that solution fit what your business needs? How
does it fit your business needs for the future? And how can you work with the partner you have selected. Do
they have the same mind set, do they have the same approach and ultimately can you build long term
strategic business relationship with them."
Case Study-KSU ERP
Implementation
References
 [Link]
[Link]

 [Link]

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worldwide-by-vendor/
References
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unstructured-retail-data-storm/

 Elragal, Ahmed, and Hossam El-Din Hassanien. "Augmenting advanced analytics into
enterprise systems: A focus on post-implementation activities." Systems 7.2 (2019): 31.

 [Link]
resource-planning