03 October 2023

ERP: Implementations (Part IV: Introducing an Upfront Proof-of-Concept Setup)

 

ERP Implementation

The standard phases of an ERP implementation are mandatory and inflexible as there seems to exist a imposed succession of the phases rooted in customer’s need of having an upfront cost estimate for the project. Moreover, the concept-based approach reflected in the creation of a set of Functional Design Documents (FDDs), even if it’s supposed to increase an implementation’s accuracy, it brings considerable challenges and an effort volume that could be spent in other areas. E.g., having a proof-of-concept setup subproject early in the project seems to bring more benefits.

Usually, before or during the requirements gathering phase the functional consultants together with the key users look at the legacy system(s) and data, questions are asked on both sides, and the findings are hopefully documented, though the outputs are high-level ideas or process design sketches. The sessions are abstract, and besides diagrams there’s no feedback mechanism to make sure that the parties understood customer’s processes and data structures, respectively that the key users understood what the future system is supposed to deliver. Some projects consider the building of 'AS-IS' diagrams and/or user stories during this phase, though their impact on project’s outcomes is questionable.

Why not include in this phase also hand-on training sessions for the key users during which a system is set up based on the available information? For example, one can start with an existing shell of the system reflecting standard parameters used in the industry where the customer works. Starting from this shell the key users and consultants go through the various processes and business scenarios, change parameters, add master data manually, sketch how the process could look like, respectively understand the gaps from expectations, or maybe how the process can be changed to avoid customizations. That’s more effective than discussing over and over the data structures and processes!

Of course, this seems to increase exploratory phase's complexity, though the increase is apparent. Allowing key users to understand how the target system works has the potential of simplifying project's planning and execution. Besides reaching a common understanding of the functionality, the key users can better evaluate whether the target system satisfies the high-level requirements, respectively better perform the various activities - requirements’ definition, reviews and user acceptance testing benefiting altogether. Moreover, they can train and involve other users earlier.

For this to work there are several assumptions. First, that the functional consultants know the target system(s), which is not necessarily needed in other approaches where a person (e.g. business analyst) who can understand how a system works and can document processes is enough. Second, the key users must have a good understanding of the legacy systems. Third, the shell should reflect the business needs as much as possible. Fourth, the necessary financial resources need to be made available upfront. Fifth, the business commitment must be there, and with this the key users should focus only on the project.

However, the most important aspect is that the parties involved need to buy and support the idea! The FDDs bring a safety net and make sense for both parties, the setup being performed only after the signoff. On the other hand, because of the considerable number of iterations FDDs involve high costs. Performing first the setup as described above and writing later the FDDs, if still needed, should improve FDDs’ quality, and require fewer iterations.

This approach allows an important volume of work to be done upfront, and even if further effort is needed for customizations and testing, a lower level of coordination is needed later, reducing thus the complexity of the planning and of the overall project.

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Koeln, NRW, Germany
IT Professional with more than 24 years experience in IT in the area of full life-cycle of Web/Desktop/Database Applications Development, Software Engineering, Consultancy, Data Management, Data Quality, Data Migrations, Reporting, ERP implementations & support, Team/Project/IT Management, etc.