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March 2021

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How To Have A Successful ERP Implementation Design Phase

By ERP ImplementationNo Comments

ERP Design & Configuration

The design stage is the part of the implementation where the focus is on creating a system configuration that will maximize the system benefits and ROI received by the client. The design phase starts near the end of discovery and planning, where project team selection and much of the documentation and planning have already taken place. The implementation team will work to translate the client’s system requirements into potential configuration options. Then, they will work closely with the project team to establish those configurations and implementation strategies that will then lead into the development phase of the project.

6 Steps of ERP Implementation Design

The design phase of an ERP implementation project can be broken down into these 6 steps:

Gather and Review Master Records

Early in the design phase, the implementation team will want to review the client’s master records. This is data that is the foundation of the current system such as:

  • Chart of accounts
  • Subaccounts if applicable
  • Customer master
  • Vendor master
  • Item master

This information along with the discovery information will form the basis for the implementation team to begin discussions with the project team about how to start configuring the new system.

ERP System Orientation & Walkthrough

Now the implementation team is ready to begin training the project team on the functionality of the new system by walking through the application. This usually follows the flow of various business cycles and starts the process of mapping out the procedures identified during discovery. This can take a few hours to a couple of days depending on the complexity of the business.

For example, we would open the accounts payable module and walk through setting up a vendor (contact info, payment methods, terms, etc.), entering an accounts payable invoice, showing the approval processes and the payment cycle steps. This allows the project team to see how they would do their jobs in the new system. During this session, project team members may identify areas where the new system differs in approach from the old system. In designing how to use the new system some compromising might take place between having to make slight changes to processes themselves or customizing the actual software.

A few years ago during the discovery process, I asked a project team member to explain their current steps to generate an invoice for product shipments. She smiled and said, “Don’t laugh. We get the shipping documents from the shipping department, then take a 7 part invoice and insert it into a typewriter and type the invoice”, all the while watching the incredulous look on my face. She went on to explain where the copies went and that they then entered all of the invoice information onto a 13 column pad. She concluded by saying that they had been using this procedure for 25 years and were looking forward to changing their approach. They were very excited to see how the new system would eliminate the typewriter and 13 column pad and they went on to a successful implementation.

Establish Initial System Configuration Settings

The establishment of the initial configuration settings includes tasks like designing the chart of accounts in combination with the subaccount structure. This is a key decision point and should be done with the goal of supporting the reporting requirements that arose from the discovery process. Done correctly the proper configuration can support things like companies, divisions, departments, product lines, and so on.

This is also the time to decide what the format of customer and vendor IDs – should they be simple numeric values, abbreviations for the names or some combination thereof? Advanced ERP systems like Acumatica and should support both to give you full flexibility in running your business.

If the client is a distributor and/or manufacturer, the design of the item numbering scheme and bill of materials and resources is also critical.

Create a Prototype

The teams will work together to build a prototype system configured to meet the client’s business needs. The system will consist of sample customers, vendors, items that feed financial activity into the accounting system using the first pass at a chart of accounts and subaccounts. Again the teams should look to see that the client’s reporting requirements can be met. This version of the system will be used to train the project team members and prove out some of the decisions made earlier in the design process.

Define User Roles

Modern ERP systems rely on user roles to control security. These role-based systems can be simple or complex depending on the size of the business and internal control requirements. For example, a salesperson should not have access to the cash receipts function or an AP person to be able to cut a purchase order. The project team will define these roles and users who will be using those roles. This especially applies to Acumatica, which has particularly sophisticated security functionality.

Document ERP Procedures

Along the way, the project team will document how the system should be used by creating procedures for each function. The procedures should include which position submits the initial invoice, how it is reviewed and how it is approved. The project team puts these types of procedures in place to support initial end-user training and the training of new people in a consistent manner. This is probably the most difficult part of the design process for most project teams. Some more advanced systems, such as Acumatica, allow client-specific procedures to be easily incorporated into the “Help” system as part of the user interface so that they are always a click away for the user’s reference thereby allowing for consistent use of the system.

I have been brought into numerous companies to review how they were using their current system after a few years and frustration levels with it were very high. In all cases there had been significant turnover and many if not all of the original project team had left the company. In many cases users are shown about 10% of the functionality of the system. They get frustrated with it and start building workarounds usually in spreadsheets. Having current and readily accessible procedures helps reduce this problem.

What do you consider to be the most difficult part of the design process?

Interested in working with PC Bennett? Tell us about your ERP and business goals on this page and let’s schedule an initial free consultation.

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5 Critical Considerations When Selecting Software for Your Business

By ERP Implementation, Software SelectionNo Comments

Software selection and implementation can be complicated. We can get caught up in the hype we hear. Ensuring you get the software you need, when you need it, is what we’ll cover in today’s article.

To begin, ask yourself if a new software solution, such as a new Enterprise Resource Planning (ERP) system or an upgrade to an existing solution, will increase productivity and efficiency. Are there other considerations? Maybe a new solution or upgrade will help your business be more precise with its data, encourage better inventory practices, or smooth out the payroll process.

Let’s go through five critical considerations when selecting a software solution for your business.

1.  Make sure there is a compelling business reason to make the change.

      • Really think through the problem you are trying to solve. Talk to your staff to get their perspective.
      • Are you entering the same data multiple times?
      • Are human errors costing you money?
      • Are most of your operations being handled in Microsoft Excel or something similar?
      • Do you have inventory control issues? Are you missing sales because you are running out of merchandise?
      • Do you have trouble getting good data to make the right decisions for your business?

If you answer yes to any of these, you have a good reason to change your software.

2.  Is the timing right for your business to make the change?

Sometimes business owners don’t realize what a big deal selecting software is. Loss of productivity, employee dissatisfaction, and cost are just a few of the side effects. In order to minimize these risks, consider the following steps:

      • Set clear goals for the new software solution. Don’t rush through this step. Know what problem you are solving and what success really looks like.
      • Involve as many members of the organization as possible. More employees on board means faster adoption.
      • Business requirement gather is critical. Document your business processes as they are today and as you would like them to be. Put it in writing. Share the business requirements internally for consensus.
      • Document things that you know are unique to your business. Maybe your geography creates unique challenges. Does your product use special materials that require a specific lead time to acquire? Are the existing software solutions in your business antiquated? Whatever the issue, get it in writing.
      • Designate a superuser. This is a person that will know all areas of the solution inside and out. This will be your go-to person for help with the solution. This individual will help bring other employees on board with the new system.
      • Have the right expectations- implementations take time. It took you a long time to get to a software decision. It will take just as long, if not more time, to implement the solution. Sometimes a phased approach will give you a faster return on your investment. Get the solution provider to help you determine the best manner for you to proceed.

3.  Finding the best solution for your business.

Every business is unique and has its own issues. One thing is universal: your competition is doing something similar. What business software solutions are they using? Are they successfully running their businesses? Find out all you can about the other guy. You’ll benefit from the information. Here are some ways to benchmark what others are using:

    • Participate in industry groups. You will find others who share your challenges. These are environments where you can share information and learn. Many of these groups are free to join.
    • Use Google. Search for “Cloud ERP”, “Accounting Solutions”, “inventory control applications”, “Manufacturing” or whatever applies to your business problem.
    • Use user-based rankings and ratings sites:
    • Evaluate the Growth Potential- ensure the software you are evaluating is using the latest technology. You are about to make a big investment. Technology changes so quickly that buying old technology doesn’t make sense, even if it saves you money. Some vendors are coming up with “new products” that are really old products with a facelift. Be aware of this. Ask the hard questions to get the facts.
      • Select 3 or 4 software solutions to evaluate. Only with choices can you make a reasonable decision. You can often save substantial money when you compare solutions.
      • Spend the time to test the software and make sure it will work for you. Have your staff try to use the solution. Bring any challenges to the software provider. Find a resolution before you buy.
      • Don’t be afraid to ask for demos and guidance from the vendor. Customer success and presales resources exist in many companies. The goal is to ensure customers effectively use the solutions.
      • Check the reviews for the products you are evaluating. Most people will take the time to review when they are not happy with a solution. Less will review when they are happy. Make a balanced decision.
      • Determine how will it interact with other software you currently use.
      • Remember to ask about the hidden value. After purchase service and training are serious differentiators that can easily be overlooked.

4.  Find the right partner.

Most of the ERP systems out there are sold and implemented by technology partners. Make sure you have the right partner. You are about to have the equivalent of open-heart surgery for your business, and you don’t want just anyone to do that job.

Implementing new software is no easy task. You will be working with your partner for some time. Make sure this is a relationship you want to be in for a while. Check references. Check their website. They usually have customers listed on their site. You may recognize a name of a company you know. Give them a call. Check their social media. Maybe ask a trusted colleague or other industry reference.

5.  Look beyond the implementation.

There are many costs to consider when running an ERP system in your business. The costs aren’t all obvious. Look for the hidden costs.

      • Support
      • Upgrades
      • Ongoing Training
      • Customizations for your business

Make sure you understand what it will cost you to run your new software. Be prepared for this. Many businesses are surprised by the cost of supporting their software. Implementing your new software was a big investment — you will need to maintain it just like you do a new car so you will need to plan for it.

These are just a few points but if you need help or have a question, please do not hesitate to contact me.

Patricia Bennett
patriciab@pcbennett.com