ILLUMITI INNOVATION BLOG

Drive ERP success with a business-led project and solid business case

Date: August 18, 2021
By: Illumiti

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An enterprise resource planning (ERP) solution is a must-have necessity for businesses in every industry regardless of size and all of their business processes. They are widely used solutions driving better planning and management of core business processes.

Do ERP projects have a bad rap? Maybe. Is there a history of glitches and snags encompassing these multifaceted implementations? Perhaps. An unsuccessful software rollout can be serious. But amidst the negative hype, the success rate of ERP implementations is rising—and so is customer confidence.

 

A few stats

In 2015, Panorama Consulting Solutions, as part of its continual assessment of businesses on the results of their ERP projects, found that 58 percent of businesses surveyed rated their latest project a success. By 2019, that figure significantly rose to 88 percent.

Back in 2014, Gartner published a report titled, "Working Smarter, Not Harder Is the Key to Business Success With ERP” which identified the principal reasons why some organizations achieve successful implementations, while others continue to experience challenges and disappointment. And while many companies implement ERP, too few invest the right amount of time and deep consideration into the business needs they’re trying to satisfy and how the ERP system fits in with their long-term strategic vision.

In the past, an ERP system was considered a key solution for opposing challenges like Y2K and as a means of replacing Excel spreadsheets for their business activities, or as a tool to consolidate an organizations’ legacy or disparate systems into a single system.

ERP implementations are no longer considered an IT-led project. Today the need is too great especially with cloud technology disrupting traditional software systems—all of these have become a must for being competitive. Forrester estimated that 2020 cloud subscriptions for business applications would account for $170 billion in revenue.

 

Be a customer advocate

At Illumiti, we painstakingly dedicate time and effort to coach our customers from the beginning to ensure they understand that they must:

  • Own the implementation
  • Actively take part in the steering committee
  • Select key project members based on their depth of experience and knowledge of the business. 

Ideally, the project team becomes integral to its company-wide competency center at the completion of the project and continue to guide future changes to their ERP system.

We also encourage our customers to follow our Illumiti Value Engineering—this approach helps to align IT and the business. By assessing the key performance indicators (KPIs) an organization measures, we provide guidance on top of those KPIs and specific to their industry. A baseline of their current performance is then recorded as a means to measure the incremental value of any future change the company implements.

Nest, we encourage customers to leverage SAP’s Standard Application Benchmark. This service enables our clients to standardize their current performance relative to their peers. The peer group is selected based on industry, region, and revenue size. By putting a more focused approach to how they fare against their competitors, they can set realistic goals—they can understand their strengths, where they are competitive, and where they may be falling short. This analysis is used as input for blueprinting to provide focus and efficiency for the ERP implementation. It also helps to define which processes are core competencies and deserve greater attention, and which are context processes where best practices should suffice.

Baselining and setting clear goals from the start also ensures that companies will be able to measure the value of what they achieved, once the implementation is complete and their operational tools and processes are stable. Reviewing KPIs at regular intervals will assist companies to better verify that their decisions and tools are in fact moving them closer to achieving their targets. If that’s not the case, these reviews serve as a trigger to take corrective action.

We constantly strive to be our clients’ partner in continuous improvement, and regularly check in with them at scheduled times to discuss their pain points and wish lists and develop a roadmap of recommendations to maximize their ROI—continuing to move KPIs in the desired direction.

Larger enterprises already think in these terms, but for smaller firms, they may be looking at their business in this context for the first time. Nonetheless, doing so will allow them to develop a strong business case for implementing an ERP system, measure the value achieved, and provide a path forward that is aligned with the organization’s long-term goals.

With the right partner, you can be confident. And you can survive.

Recommended reading: Building the Foundation for Your S/4HANA Business Case

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