In a cloud world, ensure the business objectives of your project are clear.
Ever since I first started building a business in the enterprise software space, the larger vendors and their implementation partners have wrestled with how to best approach mid-market company deployment. One of the major challenges in my view has been the fundamental concept of the ‘mid-market’ itself. What a software vendor might consider to be mid-market (a business that is not a multi-billion dollar, multinational enterprise) will, especially to those within the business, feel like a significantly sized organisation with its own complexity.
Historically the approach to this was to try to simplify complex on-prem deployment options, and to push system integrators to develop and deliver a templated, pre-configured approach. Effectively this was about trying to enable the large ERP vendors to compete both financially and in terms of solution fit with niche vendor offerings.
Whilst this approach was successful in terms of operationalising mainstream ERP outside of very large enterprises, customers were generally left supporting complex solutions, or, by selecting one of the big vendors, left with common challenges around areas like ease of use, reporting flexibility and the ability to quickly customise for small but important requirements.
Enter software as a service
Over the last few years, with the increasing presence of SaaS-based offerings, this playing field has been levelled somewhat, with much wider options ranging from specialist micro-vertical ERPs and smaller ERPs that are able to scale more than before, to the industry leaders (such as Oracle) delivering their solutions in more affordable bite-size subscriptions.
The SaaS world has provided customers with more options than ever in the choice of software that a customer could deploy – and a well-defined selection process run in partnership with a shortlist of vendors will provide customers with significant value.
What hasn’t changed as much however is the process of how ERP projects are implemented. Of course IT complexity has declined somewhat with the rise of cloud, but generally projects are still focussed on requirements gathering, configuration, testing and of course data migration and cutover. Too much focus is still placed on the mechanics of an implementation, and not on the outcome that the business wants to achieve with it. The same goes for the enabling of SaaS to deliver ongoing continuous business innovation.
Outcomes over deadlines
For mid-market customers, being able to change the focus from the mechanics of the ERP project itself to the outcomes of the ERP project as a whole allows you to continually make choices which deliver business success, not just IT project success.
At the start of a project it can often be clear what some of the goals are, such as a reduction in financial reporting time, the enablement of all users for self-service functionality and reporting, and increased accuracy in billing. Other aims include an associated reduction in days sales outstanding, or being able to ready your business for acquisition or a significant expansion. Too often though these get drowned out in the life of an ERP project, with a myopic fixation on a go-live date.
What does this mean in reality? Everything in the project needs to be evaluated against one or more of the business outcomes desired. When someone asks to add in new scope, ask whether that delivers on the outcome desired. Want to modify a delivered process? Well, would that change genuinely help deliver the business outcome required? Want to build some new reports? You guessed it – instead honestly ask whether they would add anything extra to deliver on an agreed goal.
Looking at every facet of a project through this lens enables you to focus on what really counts and will make a real difference. Of course, some requirements will likely surface, where moving from the ‘vanilla’ solution will deliver more value and a stronger outcome, allowing you to focus your energy on the things that really matter, and not those in a less critical process area, or those based on the whims or wish lists of individuals.
Having a clearly defined end-state, both from a solution perspective as well as from a business operating model perspective, can help mitigate this common challenge. With increasing degrees of business process enablement being pre-defined in SaaS solutions, choosing an implementer with a focus on being a value creator, and one which has developed a clearly defined end-state for your business, is becoming increasingly important.
This means not just gathering requirements and solving problems, but guiding you to best-in-class processes, and supporting your team as you undertake the change journey to get there. In a cloud ERP world, value comes from two primary areas – the things ‘common to all’ that you can do as efficiently and effectively as possible, and those things that are unique to your organisation or industry, where you can differentiate yourself and gain a real competitive edge.
The continuous improvement journey
What does this mean in reality? None of the advice here is rocket science, and much of it is well known, but worth repeating. Ensure the business objectives of your project are clear. Acknowledge that in a cloud world, the day of your go-live is just the beginning of your continuous improvement journey.
Recognising this, ensure that the focus is on getting initial core processes implemented successfully as a solid foundation for extending and delivering areas unique to your business – and also setting expectations both early and appropriately.
Engage with your people and help them clearly understand the desired outcomes, and ensure that the communication, training and testing approaches are clearly defined and well executed. With cloud ERPs and the technology platforms that underpin them, the possibilities to extend things with cutting-edge analytics, predictive capabilities and extensibility are endless. But, ensuring that the solid foundations of proven and core business processes are in place, and that people have embraced and adopted them, is as critical as ever, and will allow you to continuously innovate and improve.
So, if you are looking to embark on an ERP journey, then start focussing on the business outcomes you want, talk with your partners on how they help get you there – and keep improving once you are there – and don’t just focus on functional and technical capability.