ERP implementation: Process, costs and risk reduction methods

ERP implementation Success will help businesses create a foundation for development, creating a competitive advantage in the market. However, in order for the implementation process to be smooth and achieve the desired results, businesses need to prepare carefully and in detail. In the article below, Viindoo will help your business better understand the implementation process ERP solutions. Let's take a look!

Process of implementing ERP system steps

Step 1: Make a project implementation plan

Before starting any project, detailed planning is always an important step. In particular, the process of implementing an ERP system requires the implementer to spend a lot of time and incur significant costs. A detailed and specific plan will help the ERP project take place more effectively.

To build a project implementation plan, businesses need to collect some important information such as:

• ERP project budget.
• Number of personnel involved in the project.
• The ERP system that the business wishes to deploy.
• Specific problems that ERP needs to solve.
• The work needs to be done.
• Other related information.

When the plan is more detailed and complete, the implementation of the ERP system will take place more smoothly and effectively.

Step 2: Select a participating team

In a project, human resources always play an important and indispensable role. The quality of the human resources team has a direct impact on the success of the project. In particular, when implementing an ERP system, the understanding of the system and the decision-making authority of personnel will determine the choice of appropriate software and the most effective connection of departments. Important decisions are often made by the business's leadership team, including the general director, deputy directors, department heads...

Besides, the IT department also plays an important role in the project ERP implementation. This department will support and advise leaders on issues related to the ERP platform and work with the implementation team to provide technical advice and in-depth training on the system. After ERP system Once deployed, the IT department is responsible for supporting users and solving technical problems during operation.

At the same time, the personnel who directly operate and use the ERP system also play a very important role in the project. These are experts who can clearly understand the business processes they are in charge of. These employees are responsible for standardizing data, bringing information into the ERP system, performing testing and acceptance of the new system, and then retraining other end users.

Step 3: Choose a reputable ERP implementation partner

Today, there are many companies providing different ERP solutions in the market. So how can businesses choose a reputable partner to deploy the ERP system?

First, businesses should determine the budget for their ERP project. This will help businesses find an ERP platform that suits their financial capabilities and is expandable in the future.

>>>> Read More About: 11 lessons from businesses successfully applying ERP in Vietnam

Step 4: Implement ERP implementation as planned

After the business has made decisions and started implementing ERP, the supplier will transfer technology, documents and detailed instructions for the business to use. If a business decides to use high-end ERP systems, adjusting the system to suit the business can take from 6 months to 1 year or even longer, depending on the business's capabilities and finances. Karma.

However, if the business does not have a large enough budget, it can choose to use ERP software in packages or use a number of small modules to meet the initial necessary functions. In this case, the supplier will quickly deploy the system for the business without wasting much time.

Step 5: Migrate data storage to the new system and test

The fifth step in the process of implementing an ERP system at an enterprise is to transfer data to the new system. Normally, businesses will have records, information about customers, partners, suppliers as well as data about business activities and physical assets... stored in many formats and software. different.

Before moving data, businesses must check and remove unnecessary or redundant data. Once all information and data have been completely updated and verified, the ERP software provider will transfer them to the new platform so that businesses can use it on a single system.

After the system has been tested and quality assured, businesses will have a period of testing the features and implementation process of the ERP system. The business will then report the results of this testing experience to the supplier to conduct a review of the entire process. The testing process must be performed thoroughly to avoid errors that can cause disruption to business operations when the system is officially applied.

Step 6: Accept and evaluate the ERP project

After completing the ERP project implementation, businesses need to take an important step which is to check the entire project. This phase is called acceptance and evaluation. The important reason for this stage is because after testing and completion, the ERP system will be used in the actual operations of the business. Therefore, any missed errors can affect the future performance and success of the business.

To evaluate whether an ERP project is successful or not, businesses need to consider the following criteria:

• The system must fully meet the needs of the business.
• Different ERP software and modules must be compatible and interconnected.
• The system needs to be scalable to accommodate large storage workloads and flexible to change.
• The interface must be easy to use and user-friendly to increase productivity.
• The system needs to provide tools for effective management and planning for all levels of management.
• The system has a high level of security and a separate database to protect important information.
• The system needs to be easily upgradeable to keep up with technological changes and new demands.
• Business customization requirements must be implemented effectively.
• Data storage infrastructure, whether physical or cloud computing, has been perfected.
• Consider the total project cost, including: License costs, training, modifications, implementation...

Step 7: ERP implementation training for business employees

According to one study, about 56% of disruptions during ERP implementation are due to employee training. Therefore, quality training of staff plays a very important role and requires a significant investment of time and effort from both leaders and employees.

To solve this problem, businesses need to carefully consider with the supplier, especially determining whether training costs are included in the cost of purchasing ERP software or not, or must be paid additionally. Some providers will provide in-person training to employees, while others may offer businesses online courses.

Step 8: Monitor, maintain and upgrade the ERP system in the enterprise after implementation

After building ERP according to the defined process, businesses can start using this system in actual business activities. However, during use it is inevitable that errors or technical problems occur.

Normally, according to the signed contract, the supplier will maintain the business's system for a period of 12 to 24 months after the system is put into actual operation. After this period, businesses will have to pay the maintenance fees incurred to the supplier.

Besides, during use, businesses may need to improve the system. This requires businesses to coordinate with suppliers to perform upgrades. These upgraded features may include: Expanding new features, upgrading the system version to the latest version, editing functions and usage processes, connecting with third-party software …

Cost of ERP implementation in Vietnamese businesses

In the ERP system implementation project, one of the top issues that businesses are concerned about is the actual cost they have to pay to implement this project. In some cases, the actual cost of implementing ERP software has a direct impact on a business's decision on whether to undertake this project or not.

The actual implementation cost of an ERP project depends on many different factors such as:

• Scale of the business: Including the number of departments and employees using the system...
• Type of ERP system that the business chooses to deploy: This can be a general solution or a customizable solution...
• Level of customization required for ERP software
• The need for additional resources: The supplier will provide businesses with training courses for employees, high-end consulting services...

Businesses can calculate their budget based on their operating situation, including: Infrastructure, number of users, specific requirements in each business field... to choose a software Suitable ERP and best cost optimization. In addition, readers can refer to the article for more information Factors affecting the cost of ERP implementation and the most optimal way to reduce costs for more information on this issue.

Methods to deploy ERP projects successfully, minimizing the risk of failure

Clearly define the goals and status of the business

When wanting to use an ERP system, businesses must clearly understand the current difficulties that the organization is facing as well as the challenges that may occur in the near future, about the next 3 to 5 years.

This will help businesses more accurately determine the organization's needs for investing in an ERP system. Based on this information, businesses can determine the scope of work that needs to be implemented in the ERP system to properly respond to the organization's development process.

Detailed implementation plan as possible

Planning is a job that plays an important role in ensuring success ERP implementation. To do this, businesses need to identify and set specific and detailed milestones before implementing the ERP project.

At the same time, businesses also need to share the plan with all participating groups so that everyone clearly understands the tasks and work that needs to be done to achieve the project goals. In particular, businesses also need to arrange tasks in a logical sequence and determine priorities.

If this work is not done carefully, the project will run the risk of exceeding deadlines and increasing costs significantly. This can even be one of the main causes of failure in ERP implementation.

Build a suitable team to deploy the ERP system in the enterprise

Members participating in the ERP implementation process need to have experience and be willing to take responsibility for the work. Specifically:

• For businesses: The project manager will report directly to the Steering Committee and is the main responsible person from the business side. The project manager will perform activities such as establishing dialogues, monitoring progress, managing the project budget, distributing resources... To perform these tasks well, the project manager needs to have Understanding business processes in the business and being able to make solutions and decisions when needed.
• For home ERP implementation: The main consultant to manage the project and other consultants such as management consultants, system consultants, technical consultants... The main consultant's task is to plan project implementation through the Owner. project responsibility. During the implementation process, the main consultant will coordinate the activities of management, system, technical consultants... to ensure that the goals set by the business in the requirements definition are completed on time.

Make sure to have end users of the ERP system trained and involved throughout the process

After building, configuring and installing the ERP system, the implementation work is not over yet. This system does not operate on its own but requires human intervention. This intervention process includes training for administrators and staff using the system.

Training must be serious and include both theory and practice on actual systems. Businesses need to ensure that all employees using the software have received training How to use the ERP system accurately and effectively.

Choose a reputable and suitable implementation partner

After determining the goals and scope of work, businesses need to choose a suitable cooperation unit. These units need to be experienced organizations that have successfully implemented similar projects for many other businesses.

An important factor in choosing a partner is that the unit must have a deep understanding of the industry as well as the culture and regulations of the organization. From there, the new cooperation unit can provide appropriate and correct solutions for the business.

Especially, when there is the participation of senior leaders and directors of other departments in the business ERP implementation will become easier and more likely to succeed.

Vindoo is one of the leading units in Vietnam in the field ERP implementation. With many years of experience successfully implementing ERP for many businesses, Viindoo can bring solutions and Consulting on ERP implementation, orient the implementation roadmap to suit the current situation of each business.

Some typical large enterprises that Viindoo has successfully implemented ERP include EVNPECC3 Power Construction Consulting Joint Stock Company 3, Vietnam Automobile Industry Development Company Limited (Nissan Vietnam), Vietnam Automobile Industry Development Company Limited (Nissan Vietnam), Limited Liability Company. BDO Vietnam Audit,...

ERP implementation Success will help businesses simplify working processes, contributing to increased revenue in business activities. Before implementing ERP, businesses should carefully refer to the information in the above article to have the best preparation. If your business has any questions about ERP, please contact us immediately Viindoo for immediate answers!