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ERP Project Management | Part 1

What to pay attention to?
Eraneos IT Advisory Blog ERP Project Management Part 1

ERP projects are all the same and easy to handle! Really? Let us find it out!

Different reasons trigger an ERP project. ERP projects are sometimes driven by the business or IT department of a company. Their complexity and challenges are often reduced to one of these departments only, which is not correct. From IT perspective, an ERP system has huge impact on IT landscape, technological / programming depth, interfaces to 3rd party systems, data migration and business warehouse usage as well as IT operations and support. From business point of view, we see that business processes may change, the customizing, look and feel of the system is new and business departments are unwilling to accept the system if requirements are not met.

Therefore, ERP projects are neither pure IT projects nor business organization projects. They require a high skill from technological depth, business understanding and project management expertise, which tackles both to master it. This shows that ERP projects have different facets and are not always easy to manage according to the same scheme. But what they have in common is that it all starts with selecting the right ERP system, ERP implementation partner, project methodology and manager. As these are critical factors from the beginning of an ERP adventure, we want to discuss in this article what are the pitfalls for customers and what they should take care of.  
ERP Methodology and project management
Eraneos Blog IT Advisory | RP Methodology and project management

Looking at today's ERP projects, many clients run ERP project still in a waterfall approach. Especially implementation partners provide proposals in a waterfall-based project manner. That approach might be easy from cost and time calculation perspective for the proposal and allows the customer good cost comparison as timeline and scope are fixed, but it has several drawbacks if no agile elements are incorporated. Compared to agile approaches, you need to wait very long for user feedback and test results. Additionally, user satisfaction may come after the fulfillment of outdated or unprecise functional specification. Disagreements between the involved parties could be a possible consequence.

As users do not know the ERP system at all at the start of the project, they are very excited at the beginning but it turns into frustration when they see the system the very first time and do not understand how it works or why requirements are not met, although they have mentioned them in work-shops before. In order to avoid that, more agile approaches, like SAP ACTIVATE, have been evolved with agile elements like SCRUM, for better and faster customer integration and feedback. Although agile approaches are more and more common, many customers and even experienced project managers have not incorporated their principles and struggle to implement them in ERP projects. They either think in a waterwall-based scenario or have no experience in ERP projects and run into common pitfalls like unrealistic planning, missing ERP related tasks, too short effort estimations, wrong team setup or unclear responsibilities.

Interestingly, ERP projects are handled differently in different business sectors as well. In the Swiss public sector, HERMES is the go-to project methodology. Within HERMES, which foresees different project types, ERP projects often are regarded as the “Procurement and implementation of a standard software”. Although that might be technically a correct definition and being a great project methodology, HERMES is not focusing on ERP specific tasks or templates like fit-gap workshops. Although HERMES also provides agile variants, customer often run ERP projects in HERMES with the waterfall-based version, facing the disadvantages above. Another weakness of HERMES is that the project team needs to work and prepare ERP specific task like a proper authorization or development concepts. However, in the public sector, HERMES is often used as the standard methodology and others are either not known or accepted.

Other sectors or companies have their own project methodology which requires certain outcomes or steps that need to be undertaken. Combining that with an ERP project or ERP vendor specific method is very difficult and time consuming to define. Although being mandatory, these own project methodologies lack ERP specific tasks as well and can hardly be used on their own.

From an ERP provider perspective, we can look e. g. at SAP. They have provided their SAP ACTIVATE method which covers very ERP specific tasks and enriches it with tools and content. SAP ACTIVATE can be tailored for the specific customer and sector to cover the specific environment in which the ERP system is to be implemented. Although it provides a project management stream with some templates, it lacks ERP vendor independent tasks which you can e.g. find in HERMES: a formal approach to select and evaluate the best ERP solution that fits to the client. From the ERP vendor perspective, the selection is clear from the beginning: the customer goes for our solution, no need to question it.

ERP system and implementation partner

Selecting an ERP implementation partner and system is a unique task and not daily business for most companies. Due to lack of experience, the overall approach to find the right partner and solution is an experiment for its own for many customers. It sounds trivial, but this problem is eminent for many customers, as they do not have a market overview of ERP solutions or get biased by marketing slides or promises from single vendors, which are not properly investigated and confirmed. They also underestimate or even miss other factors like detailed functional depth, data security, technical connectivity and migration options, future roadmap implementation, business support SLA or enhancement/customization abilities or even just the priority of the requirements. The result is a fast-paced, opinion-based decision for an ERP solution or partner without undermining facts and rational thoughts. Before the implementation of an ERP system, a well-defined and structured approach is needed to evaluate the best ERP solution and partner for the upcoming challenge.

Furthermore, clients fully trust the implementation partner but naturally have difficulties to verify results, project progress and overall project success factors. The implementation partner typically provides a project manager as well, but this role is organizing timelines, creates status reports and tracks risks and issues often in the favor of the implementation partner. Trust is important but it needs to be verified by an additional project manager on client side acting as a counterpart, a so-called trusted advisor. The counterpart project manager can identify problems, risks, issues in an objective way and set clear responsibilities and demands commitment. The role becomes even more critical as in most ERP projects, there are many different suppliers, e.g. for data migration and interfaces of various systems, each one focusing on their work package only, but someone is needed to have the full picture view and facilitates between the suppliers and stakeholders.  

ERP Project Management - our solution
Eraneos IT Advisory Blog ERP Project Management Implementation

Eraneos, as an ERP independent consulting and project management company, has understood that ERP projects are complex and selecting the right ERP solution and implementation partner is not much easier then implementing it. Based on our broad ERP and project management expertise, we support clients to find the right vendor and implement the project with the client, the selected vendor and appropriate ERP project management methodology. As a neutral partner, Eraneos looks for the best solution for a client and does not focus on any vendor or implementation partner.

Eraneos is not selling software licenses and we do not represent an ERP manufacturer or implementation partner. We are independent in our recommendations and our statements are based on facts to remain objective. Building trust and focusing on client goals are critical for us. This approach ensures high user acceptance, business requirements fulfillment and overall project success.

We can pinpoint risks and issues that are often transparent to clients and implementation partners. We can support our clients by running the project management on their side and work as a trusted counterpart to the implementation partner, ensuring commitment to timeline and tasks. We have incorporated agile thinking and we connect business processes with users and their expectations and experiences as early as possible to ensure user acceptance. Due to our project management expertise, we are also able to understand and adapt existing project management methods from our clients and manage the project to their standards and the ERP specific needs.

Apart from project management, we can also support ERP projects with specific skills or roles like test management, Cut-over planning and execution, migration management, data cleansing, Authorization, IT architecture and functional business expertise. By integrating with the client and suppliers, we define clear responsibilities, outcomes, timelines and project success criteria. Although stakeholder management is complex in such projects, we focus on teamwork and solution finding.

We have certified ERP consultants in HERMES/SAP Activate and we also provide project templates and a large project management community to support our clients. Apart from hard factors of a project, like time and budget, we also focus on acceptance and satisfaction of our clients and users to ensure project success.  

Due to our large ERP community and implementation near-shore partners, we are also able to implement the ERP system and customize it. Eraneos and in combination with our partners, we are ready to engage ERP projects as the main implementation partner. In that case, Eraneos acts as the main supplier and SPOC for our clients and our clients run the project management on their side on their own. This setup has several advantages for our clients, like top-notch project management expertise, broad functional and technical ERP competence, high capacity of project stuff, efficient communication in native language and a compelling pricing.

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