ERP systems should largely map all business processes digitally to make resource management as efficient as possible. Continuous integration and a move away from isolated solutions lead to a holistic ERP system in which resources can be managed company-wide. ERP systems also improve the flow of communication in the company and can make cooperation in the company more efficient in the sense of e-collaboration. Typical functional areas of AN ERP software are:
- Materials management (procurement, warehousing, scheduling),
- Production or production planning and control,
- Need assessment,
- Finance and Accounting,
- Controlling,
- Human Resources,
- Research and development,
- Sales and Marketing,
- Master Data Management,
- BOM,
- Product Data Management,
- Document management
The introduction of ERP software is a complex project for medium-sized and larger companies and can be divided into two phases, for example:
Evaluation
The needs-based selection of ERP software depends to a large extent on the individual requirements of the company. The degree of awareness and market presence of software can only provide a secondary indication of its suitability. First of all, an individual needs assessment should be carried out. On the one hand, reference processes (best practice), which are compared with your business processes, serve as support for this. On the other hand, the functional requirements resulting from the modelled processes can be supplemented using standard function catalogues. This first sub-project is often carried out by the companies the company’s initiative but sometimes supported by management or management consultancies. Important decisions for the further course of action are already made here. To determine needs, some management consultancies offer methods from which specifications for software selection arise. For this purpose, the business processes of the respective company that wants to introduce the software are recorded and derived from what the software in question must do. This requirement profile is transferred to a requirement specification and published as such for the ERP providers. After a review of the market and inquiries to providers, who usually require the specification-related degrees of the fulfilment of the respective software, suitable providers are included in a shortlist of only a few (5-6) providers. In addition to the requirements from the specifications, other criteria can be included in the evaluation of the providers, the performance or economic potency of the provider/system house. The selected suppliers are invited to present their products. On the one hand, the presentation should provide an overview of the software, but on the other hand, it should also respond to the requirements of the company and, if possible, include a specific task. Finally, the providers are assessed and selected according to predetermined selection criteria.
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Implementation
The actual software introduction is usually also subject to the project sovereignty of the user company, but in practice is often led by the provider company or a service partner of the provider, as there is often a correspondingly high level of practical experience. In a first step, all business processes of the company are analyzed. Then it is decided whether the process should be maintained or changed as usual. Only when all business processes including their interfaces within the company or to suppliers and customers have been modelled, these business processes are mapped in the ERP software. Subsequently, all required data (master data) is entered into the system or, if necessary, transferred from an existing system that is to be replaced. After training the users, several simulations of the business processes as well as a test phase and acceptance, the real operation of the ERP solution then starts, analogous to the classic “waterfall model“, as it is used, for example, in software development.
Alternative implementation
However, there is also an approach to the introduction of ERP systems that is not based on this two-phase model but uses methods of agile software development. In this approach, the iterative process model Scrum is used together with Extreme Programming to gradually introduce individual parts of the ERP system. After each development step, the results are then validated and improved.
In times of digital transformation, further implementation models are also emerging that take into account the constant change and changes in business models and business processes. With the QITT model, for example, a Qualification of the initial requirements, Implementation of the ERP system (according to Scrum or waterfall), Train the employee based on the new system and real data in a test system and a subsequent recurring process of Transformation of the software to the permanent changes due to digitization.
