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Choosing Your New ERP System 11/29/2012

Posted by TBoehm30 in ERP.
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After you’ve gotten the approval to start the process for a new ERP software system, it is time to start the search and make the decision of what to buy.  It is a project on its own just to make that decision.  It should take one to three months to go through all of the options to determine the best solution.

The way to begin this project is to lay out your plan.  You need to have an idea of what steps you will take and how long you have to finish.  The plan needs to include who will be involved, how much, and who gets to make the final decision.

The first part of the plan is who will be included.  This is an important project and the right people need to be included on the team.  A senior manager that knows how important the project is, and has authority to set priorities needs to be on the team.  Others as representatives of major departments need to be included.  The best person to represent the department doesn’t have to be the highest manager; you need to include the one who understands what is needed, but also has the time to attend the meetings.

As you get a commitment from enough people to fairly represent the company, you will create a meeting schedule.  Once a week may be enough to start, but eventually you will have vendor responses to review and demonstrations to watch.  This will increase the time commitment from the team.  These people need to understand that this project is just as important as their ‘day jobs’.  They will need to dedicate some time to this project, even if it means doing overtime on their normal responsibilities.  This part is crucial because ignoring the project for too long will ensure failure.

Probably the most important part of the selection process is the requirements.  The team needs to define their requirements for the new system and prioritize their needs.  Not all software will do exactly what they need in the way that they want it, so they need to be ready to determine what is critical and what is nice to have.  The requirements should start with replacing what they already do, and then consider what is needed for the future of the company.  You will need to include the details of current operations such as Purchasing, Selling, Accounting, etc.  Also think about reporting, dashboards, paper output and screen design. 

Along with the processes, you will have to consider the technical aspects of the software.  Will you want it in the cloud or on premises?  If you are thinking about the cloud, do you want software as a service (SAAS) or platform as a service (PAAS)?  You need to know the difference, and understand the language so that when a vendor describes their solution you can correctly interpret what they are saying.

Can your IT department support the new demands of the software?  Will you need new people to create reports, customize the software, and support the growing demand for security?  These are import discussions to have before choosing the final software.

Once you have a good set of requirements, you can send out some sort of questionnaire, request for proposal (RFP), or other document to a list of vendors.  Their responses should be evaluated by the full team to determine a short list for demos.

You can have 4 or 5 short demos if your list of vendors is still too long to decide.  That should help you narrow the choice down to 2.  These demos need to be held to under two hours, and the vendor needs to be aware that you will cut them off if necessary.  Doing a lot of demos can be overwhelming to the team and they will forget what the first demo looked like at the end of the process.  You need to make sure that discussions are timely and that notes are taken for later review.

Your final choice should be made from the top 2 vendors.  These final vendors should be given the opportunity to show you their best presentation.  Give them the amount of time that they need to impress you.  This might take several hours for each of them and require a couple of days worth of time from your committee.

I like to prepare a document for the team that lists out the requirements and gives them the ability to write notes about each requirement and give each a grade.  The grades can then be tallied to objectively decide which software is better.  If notes are made using the same format, they are easier to compare.  The notes also make it more difficult to forget the important parts.

One of the hardest parts of this process will be to notify the losing company that they were not chosen.  They may come back with lots of questions that will require more work and put you in an uncomfortable position.  One time, I had a salesman email my boss describing how unfair my process was, and how they thought they were being strung along when the decision had been made in advance.  While embarrassing, I had the full documentation to show that no decision was made until the end, and the notes showed the grades where the number 2 company was very close, but clearly the second choice.

Once you make the decision and notify the winning company of your intentions, it is time to sign a contract.  Make sure that you have professional negotiators at the table to get the best deal possible.

Now that you have decided on your new ERP or other large software project, the fun is just beginning.  You already have a good team who understands the issues, and are ready to work.  They know that it is a global world, and Technology makes it happen.

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ERP Training and Power Users 06/28/2012

Posted by TBoehm30 in Trainiing.
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4 comments

A full ERP implementation project will contain plenty of training.  All the members of the company need to start from scratch to learn the use of the new system.  I’ve scheduled classes where we have 10 days of classes plus three alternates a week or two later for anyone who missed it.  The thing to remember is that is just for the basics; you will spend much more time with the people destined to become your ‘Power Users’.

The main classes that will be scheduled are for beginning 101, learn how to navigate type instruction.  When users logon for the first time, they need an idea of what to expect, how to get what they need and what they are allowed to do.  Everyone will need that class so it will be the biggest or most offered class.

After the beginning class, you will need some specific classes.  The Accounting group will need to go into detail on the accounting screens.  The Manufacturing groups will need specifics on how to run MRP, use Work Orders, order Supplies, etc.  The Customer service group will need to understand Sales Orders, Cases, how to change documents, and update notes.  The point is that these classes will be smaller and need to include only the groups that focus on the topic being taught.

Most project managers and organizers will stop there.  They will teach what is needed and then allow the users to figure out if they need further functionality or further help.  It has been my experience that users don’t know to ask for more.  They will start using the system in the way that they are taught and not try to branch out for better, more efficient processes.  Usually a new employee, or outside consultant will bring in ideas on how to use the software better.  It’s rare that someone just figures out better functionality, communicates the process with their manager and gets the company to adopt the new process.

As I wrote in a previous article, follow-up training is necessary.  Once users become familiar enough with the software, they need a time to go back to ask questions.  They will want the details on why they do what they do.  They need to know how it impacts the company and what the big picture looks like.

That full process will take care of most of your users.  Beyond that, however, are the ‘Power Users’.  These are the people who seriously want to take advantage of the system and use it to the fullest extent possible.  These are the people who currently have massive spreadsheets that they download to understand the data.  They need to understand what is going on at a basic level and make decisions based on that information.

These are the people who will try your patience once the new software is going strong.  They will need one-on-one guidance for their crazy projects.  They will stretch your understanding of the software to its limits and force you to call the vendor.

Now is the time to plan for their training.  They know what they do, and will be able to explain what they need.  You will be able to schedule one class for a bunch of them, or several classes if needed.  Getting them together may even work in your favor, giving them other resources to go to and other further ideas on how to improve the status quo.  You need to be at the top of your game and have good backup support for these classes.  You might want managers included in the room so that if ideas get out of hand, they can be cooled down.

Watch the beginning classes for the people who ask the most questions in the most detail.  Figure out who you think will become your ‘Power Users’ to include in the new classes.  Talk to them in advance to get an idea of what they will need.  Figure out how many of them can go into the same class.

These are the people that will figure out how to drag the last penny of profit out of what you currently have.  They will need data; all they can get, and more if possible.  They will need access to the system; more than the IT department currently provides for them on the standard templates.  They will need instruction on what other departments do, and how that relates to what they do. 

We spend so much time on teaching the basics.  Many classes have to go at the speed of the slowest user.  This won’t allow the best use of the software, and won’t create that immediate ROI that was the biggest reason for the software.  Spend a little more time and attention on the best and the brightest.  They are the ones who will have the biggest return on your investment.  They are the ones who know that it’s a global world and Technology makes it happen.

Comment with your stories of how users stretched the possibilities of your new software and how you had to develop new training to keep up.

Why do you need ERP System Testing? 05/23/2012

Posted by TBoehm30 in ERP.
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Testing is one of the first items that are removed from a project when time becomes tight.  Many people wonder why they have to spend so much time doing formal testing when they have spent so much time training with informal tests.  They have spent so much time with the new system that they just know it works.  What is the point of spending a large amount of time on formal system testing?

First and foremost, you need to validate that you are getting what you think you are getting.  A new ERP system is a large complicated piece of software.  Just because individual sections are working, doesn’t mean that each module is sharing data the way it should.  A plan for system testing should include many of the core team, so they can see the larger picture.  You also need to be sure that the right communication is happening between team members.

You need to make sure that when a PO is created and received, that the inventory is added correctly and the journal entries are made appropriately.  You should review the documents and reports generated from the process to make sure that everybody is satisfied with the results.  When the PO is tested separately from the accounting module, it seems to work fine.  However, did anyone from accounting notice that the manufacturing group has automated the POs for inventory differently than expected?  This would be found in System testing with good communication between core team members.

You need to be absolutely certain that each process is testing using the same parameters.  There could be hundreds or even thousands of parameters in a good ERP system.  These parameters should be set based on the way your company does business.  For example, FIFO, LIFO, or Standard should be set to account for product costs.  I have seen software fail because no one realized that parameters were different than expected, or were changed during go-live.

The CYA reason for system testing applies for consultants and/or public companies.  A team who delivers a working ERP system takes a large risk of someone coming back with complaints.  Users can always find something to complain about.  A full, well documented, system test will reduce the risk for the implementation team.  If they have tested every scenario possible, then any complaints should already be documented and signed off. 

Auditors may be allowed to review the implementation process, especially if something goes wrong because of the software.  A good system test would be enough to hand over to show that you did everything you could think of to prevent problems.  When problems occur, you should be able to point to the system testing documentation to show that something new or different has occurred to cause the issues. 

Problems that arise after the system has been in use could become very large problems.  It is much better to find them early on.  A small problem could grow into something much bigger over time.  A problem that is found after a time lag will be more difficult to find and could be more difficult to fix.  System testing should be designed to follow all your processes to a logical conclusion.  If you are using the system for accounting, then journal entries and account balances should be watched during system testing.  If the software is used to run a call center, then you need to run rollup reports containing all possible call types.

IT projects are constantly delayed and have scope cut to meet deadlines or budgets.  A user will be much more forgiving of a delay in a project than he would for bugs in the software.  A problem that should have been caught in testing will be remembered far longer than any scope issue or delay.  Users will grumble and gather to complain about the software, keeping the errors at the top of their mind.  Delays, however, will be forgotten as the software finally comes out to make their lives a little easier.

A good system test will prove that you have done your job well and completely.  You can be positive that the system meets the requirements you were given, and you have documentation to back that up.  You will be able to move on to the next phase of the ERP system, or move on to your next project with confidence.  You know that it’s a global world, and Technology makes it happen.

Have you been involved in a project where testing was shortened, or removed, to the detriment of the company?  Leave your comment below.

ERP – Follow-up Training 04/27/2012

Posted by TBoehm30 in ERP.
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3 comments

I spent last week in another System Administration class.  There were 9 other people in the class with me.  Most of those 9 had taken the class at the beginning of the project, but now they understand the system so the class actually made sense.

The first time we took the class, it was like drinking from a fire hose.  We saw what the system could do, but there was no possibility that anyone walked away with the ability to fix anything immediately.  We took our notebooks filled with pre-printed material, our extra notes and went home to practice what we learned.   Hopefully, we at least got the big picture.  It would take time to learn the details.

I had taken the class previously as well.  Since I have been heavily involved in the technical issues of this project, I knew most of what we talked about during this round.  I was only there to make sure that when we talked about something that was customized, or company specific, I could lead the discussion.   Several times, I had to interrupt to say that this subject didn’t apply to us, or explain how we had already implemented a particular feature.

During the 4 day class, we covered numerous topics.  Every now and then I would glance around the room to notice how much people were paying attention.  The class was usually divided in their attention since they are the entire technical team for a company covering 4 states.  I expected some division of attention while they had to attend to other duties.

Some topics were easier to understand than others, and some people had more practical experience with some topics.  I hoped that, like me, people were paying extra attention to the few topics that they did not understand completely.  I also hoped that they listened carefully to any topics that seemed new to them.

I walked away from the class with new ideas on how to use the system to improve the flow of information at my client.  For example, the ERP system we work with has a statistical module for storing data over time.  I had created a few dashboards using real-time data, but now I can use the statistical data to show those same dashboards over time.

This is the training model that needs to be followed for a successful ERP implementation.  Like a good presentation, people need to be told what they are going to hear, then they need to hear it, then they should be told what they just heard.  The plan for a new ERP system should include a plenty of training for all users of the system.  They need at least two official training sessions.  The first one gives them the overview of what they will need to learn.  The second one goes over the same material, but this time the users understand the details.

Between the two training classes, people will need to practice with the new system.  Some of them will design and document the new procedures.  A few users will test out the limits of the system by pushing every button, clicking every link, and choosing every option.  Some of them will go back and not think about the new software until the next class.  Obviously, a good implementation plan will optimize the probability of users going back to practice with the new software.

A third class might also be a good idea to plan.  At some point in the future, users will want to see what else they can do.  They will want to go to a new phase where they wring out every improvement possible.  A class scheduled for a year after go-live is a good time for that one.  Users will have a very good idea of what they are doing, some small ideas for what they want to do, and a big appetite for new possibilities.

The good ones go like that because it’s a global world and Technology makes it happen.

Building an ERP team 02/29/2012

Posted by TBoehm30 in ERP.
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Half the team wanted to delay, half the team wanted to move forward with the existing schedule.  What could we do?  We didn’t want to make anybody so mad that they would quit the project, or worse yet, quit their job.  If the team as a whole couldn’t agree, who would stand up and be the bad guy to delay the project?

This was the dilemma I was in recently.  We were doing a dry run for the go-live of an ERP implementation.  Corporate was already using the system, as well as a few other locations.  This last team to join the system was not ready; they were way behind schedule.  However, they didn’t understand what they were missing.  They felt like they had more important projects to concentrate on and the ERP project was getting in their way.  They just wanted it to be over; put them on the live system and work out the bugs later.

All of the meetings with this company so far had been as a team.  We made positive decisions with everyone’s input where everyone could agree at the conclusion of the meeting.  The other locations had seen some setbacks, but everyone had seen the need for a delay or change in the project.  We had always been a solid team who understood the decisions made.

This was different.  The on-site team wanted to go-live, no matter the consequences.  There are always problems at go-live; we should just handle them as we get them.  So what if we didn’t understand all of the setup codes now, we can change them later when we figure them out.  All of the reports won’t be ready, but every group had needed new reports after go-live.

The problem, of course, was one of risk.  If this one group couldn’t close their accounting in a timely manner, corporate wouldn’t keep the books open just for them.  They had several other sites to think about, and they can close their books on time.  Closing the books quickly, each month, is important to a public company, and it is one of the reasons we were implementing the ERP system.

The on-site team thought that if something went extremely wrong, we could just figure out everything on paper.  They actually said that.  A multi-million dollar public company writing their monthly reports using paper and a calculator.  I can see it now.

The manager on-site wanted to know what problems would cause them to not be able to close the books at the end of the month.  If we could list out all the glitches, difficulties, snags, hitches, or complications, then they would just avoid those and be successful.  It was a great strategy for him.  We would come up with a list of problems and then if we missed one, the problem would not be his fault.  He wanted to put the blame on everyone else if there was a problem.  Let’s just go-live now and get this stupid project behind us.

The rest of us in the room wanted to delay the project.  Give them more time to figure out what is going on.  Extend the schedule so that they can keep the doors of the factory open, and still spend some quality time on the ERP project. 

The problem is that we needed to work as a team.  How do we come to an agreement when we are on completely different sides of the same coin?

We gave them another couple of weeks to ‘catch up’ on what had already been scheduled.  To their credit, they worked extremely hard to get it all done.  I was getting emails at 3 in the morning.  Unfortunately it was too little, too late.  When the new deadline passed we were at the exact same spot.  Most of us wanted to delay the project, but the team on-site didn’t understand why they couldn’t just proceed.

I actually practiced my bad-cop speech.  I stood in front of the mirror and explained why proceeding down this path was a bad idea.  When we came to go-live and had to give a thumbs-up thumbs-down vote in front of the CFO, I would have to vote thumbs-down.  That is what I would have said had we gotten to that point.

The director of IT beat me to it.  He said in plain language that the deadline was missed; it’s time to change the schedule.  Thank goodness.  Everyone agreed at that point, even if the on-site manager only agreed under protest.

Going forward, I need to get them to understand that their job is to convince me that they are ready.  It isn’t just to go through the steps needed to finish the project.  There are people who are going to evaluate their readiness at the end of this project.  We will have help in deciding whether or not to go-live, based on their performance.  If they can understand that, then we have a shot at once again working as a team and getting the job done.

Anyone else have some fun stories about getting a team to work together?  Tell the world about the time you worked with a group to come to the conclusion that It’s a global world and Technology makes it happen.