ERP Implementation: How to Control the Cost

When you think of a new or upgraded ERP solution, there is a lot to consider. Features and functionality are essential. You need a solution that best meets the needs of your industry and company. You also need a solution that your employees will adopt. And you must be able to expand with your growing business.

Oh, and one more thing: cost is a major consideration. If you have budgeted for the cost of the program, you should still consider the running costs and any allocations you want during implementation.

You may not have a lot of leeway in the cost of the program itself. The software manufacturer sets this price. The Reseller Partner implementing an ERP solution will provide a proposal suggesting the time needed to design and allocate the software to your specifications and to implement it. You will agree on an hourly rate, and a time frame for completion will be set.

But the final costs are somewhat under your control. There are many factors to consider if you want to control the cost of implementing ERP.

area

Scope refers to the size and complexity of your ERP implementation project. Controlling the scope of your project will go a long way toward keeping implementation costs in check. Before you begin, check the system requirements and separate the wants from the necessary. What are your real needs? Yes, it would be nice to have all the bells and whistles, but everything comes at a price in time and money. If you make the mistake of trying to get it at once, the cost and delivery time will increase. A better approach is to implement the most valuable functions first and leave some of them for future stages. Experience some early success and let your teams learn what the new ERP system has to offer.

At ArcherPoint, we recommend starting with a business process analysis and agreement on a project plan, budget, and schedule. This planning stage is crucial. This is the time for stakeholders and those who will use the system to collaborate and agree on requirements. Once the scope is set, try not to constantly add “extensions”. Add-ons can come later after the system boots up.

Of course, some changes can be accommodated and processes improved as the project progresses. But try to complete one stage at a time, giving your team a sense of accomplishment and keeping morale high.

Try not to extend the implementation project more than a year. Human factors such as your employees’ ability to focus will affect your success, and the project may falter. Keep it for less than a year to reduce fatigue and maintain focus. If you have complex business requirements, plan some for the second stage.

timetable

Pay attention to your schedule. If you try to get your new system up and running too quickly, your costs will increase. Spending for a long time will have the same effect. With your implementing partner, determine the optimal schedule and do your best to stick to it. Don’t rush to get started before the foundation is laid and take into account any seasonal fluctuations in your business including internal factors such as vacations and holidays.

work sharing

Each implementation includes a number of tasks. Some of these tasks will be performed by your implementation partner, and others will be the responsibility of your internal team. Some steps can be done in parallel. (For example, your implementer may be working on some tasks while your in-house team is working on others.) This will extend the time and cost of implementation if the implementing partner has to do all of that.

For example, your team will clean up the selected data to be transferred to the new system, but your implementation partner will import the actual data. The partner will verify and validate that the data exists, then your team will perform a final review. Both teams work together on customizations. The implementation partner will manage the assignment, but your employees will have to be involved to ensure that the resulting assignments meet your requirements.

The more work a customer can do, the more money you’ll save. This also has a strong secondary effect on project quality. The more involved your employees are, the more they understand the value of the project and are happy to adopt the software and learn how to use it.

Your implementing partner will take care of the following:

  • Develop a training plan, provide materials and implement training
  • Develop a plan for system testing and integration
  • put the order into production; Being available for issues and questions

Your internal team should take care of:

  • Data cleaning and verification
  • Data formatting and import cleaning
  • scheduling training
  • System Test
  • Go straight! Avoid dispersants. This is critical because your business needs to continue to operate without interruption.

There is some flexibility with the above tasks but remember, if your goal is to control costs, you must be willing to help. Depending on the specific ERP and the skills of your employees, you may be able to handle training online or at home. You can assign superusers to train the rest of the staff.

the right employees

Having the best people on your project team is essential. It can save time and money. Choose employees who have the necessary skills and a good knowledge of your business operations. They should see the value of the new program and be excited about the project. They must also be willing to work hard and accept the challenges of an important project. You don’t want people on your team to resist when you hit obstacles or fade out in the middle of a project.

Include representatives from the implementing partner and your company. Choose a positive project manager, a good listener, and a communicator who takes charge and keeps the team on task.

the right partner

The key to successful ERP implementation is choosing the right implementation partner. The best partners are qualified, experienced and have a proven track record of successful projects. Ask for references. Even if they are not the least expensive, they can save money in the long run when they deliver a successful implementation on time and within budget. Since they know what they’re doing, they will also prevent you from making decisions that could cost you money – including warning you about cutting corners that could negatively affect the outcome. Put as much time and effort into choosing a partner as you would choosing your own ERP system, and you’ll be in good hands.

Don’t risk a failed implementation by trying to cut costs

There are many opportunities to control the costs of your ERP project. A reliable implementing partner and a well-chosen internal team will be the key to success.

If you want to know more about Make Your ERP Purchase Decision and how you can control the costs of a successful ERP project that will add value to your business, Call Our experts at ArcherPoint.

by ArcherPoint, archerpoint.com

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