How Do You Implement an ERP Implementation Correctly?
Our guest author shows you how to implement your ERP system in your company in 5 steps.
ERP systems are becoming increasingly important with digitalization. However, many small companies shy away from the initial effort (this refers to the setup process and adaptation to the company's own processes) and do not understand that this hampers the long-term growth of the company. So that you don't have to make this mistake yourself, you will get a brief insight into how to properly implement an ERP system in your company.
In advance, we would like to draw your attention to our articles, which clarify, why you need an ERP system for your company and what benefits such an ERP system brings. Because only those who have actually understood these two points are ready to deal with the selection and implementation of an ERP system.
What is an ERP system?
"ERP" is the abbreviation for the English term Enterprise Resource Planning. In German, this means that all business processes and resources, which a company has, can be digitally and centrally planned, controlled and managed via software solution. This includes, for example, the planning of capital flows, a forward-looking determination of material requirements, but also an automatic invoicing with subsequent payment reconciliation using the connected payment providers. Since there are many different providers of ERP systems, which have specialized in various areas of application, you can get a good overview of OMR Reviews about the best rated ERP systems.
Choosing the right software
The most important step in implementing an ERP system is undoubtedly the selection of the right software. After you have found the right ERP provider and have been successfully advised and supported in the choice of the ERP solution, the ERP implementation begins. This is divided into several steps that need to be carried out so that the ERP system can work without restrictions and achieve the desired benefit.
Still not decided for an ERP system?
Which software best matches your internal processes, you can find out in both our best-of-article about ERP systems for small businesses and ERP systems for medium-sized companies.
Gradual Implementation of the ERP Software
Gradual ERP implementation (Source: Own illustration)
1. Step of the ERP implementation: Create functional specification
When choosing a suitable ERP program, in most cases a corresponding functional specification has been created, which contains the requirements and wishes of all departments (if any) for a new IT system solution. In this step, the defined value flow can be adjusted and changed again. To maximize optimization, it is helpful not to focus too much on the current state of the business process, but to focus future solutions: How shall the new ERP system map future business processes? Once the specification has been accepted by all parties involved, the ERP provider will create a so-called specification. This includes all tasks that need to be performed for the ERP introduction, such as the adaptation of programs and APIs (Application Programmable Interfaces).
For smaller companies and e-commerce learners who are often alone at the beginning or have a small team, this sounds like a lot of initial effort, but it is essential to find the right ERP system
2. Step of the ERP implementation: Find ERP software
Finding the right software is like searching for the holy grail for many companies. A wrongly selected system can quickly lead to high opportunity costs if it has to be changed again later. To help you with your search, we have introduced the ERP systems that have been rated most and best by other users.
Popular ERP Softwares:
Xentral ERP
Billbee
e.bootis-ERPII
Sage 100
JTL
weclapp
microtech büro+
SAP S/4HANA Cloud, public edition
360ᵉ by e-velopment
Pickware
DreamRobot
NEKOM
Myfactory
plentysystems3. Step of the ERP implementation: ERP provider's functional specification
Once you have defined your requirements in the first step and started looking for the right software solution in the second step, the third step is to validate the provider in terms of performance. For this, the so-called functional specification is created by the software provider. There, the requirements for tasks and processes for the ERP implementation are written down in detail. They become part of the contract after successful checking by both sides and reliably secures the range of performance for both sides.
Comparison functional vs. performance specification / Source: Own illustration
4. Step of the ERP implementation: Prepare own company data
Since the future ERP system of your company needs certain data as a basis, the old data of the old system must first be prepared, maintained and extended. If there was no previous ERP system, the data must be made available otherwise. This step of the ERP implementation can be time consuming and should not be underestimated when planning an ERP. Usually only basic master data like contact data, customer base, articles, suppliers and bills of materials are transferred. After completion of data maintenance, responsible employees must be comprehensively trained.
5. Step of the ERP implementation: Training & launch of the ERP system
During the training for an ERP system, a company can decide whether to let all employees participate or whether it focuses on training previously defined persons. If only key employees are involved in this process, costs can be reduced to some extent. Because the knowledge gained in the ERP training must be passed on to colleagues. In this case, a precise documentation of the information provided and screenshots for better illustration would be helpful.
Furthermore, ERP providers can support the internal knowledge transfer by providing all employees with informative training and process documentations. This part of the ERP implementation is completed when the users or employees confirm that they feel adequately trained and all processes have been documented accurately.
Next comes the data import, which then needs to be checked for correctness and completeness.
Only when all the steps listed above have been successfully completed can the new ERP software be put into operation for the first time. It is recommended to completely shut down the old system. If the accounting was processed via the old system, it is important to realize that for proper accounting (GoBD) all information of the last 10 business years must be kept accessible at all times. It is advisable to inform yourself at the previous provider how this will proceed in concrete terms. Perhaps this step is redundant due to a complete import of all data into the new system.
Now nothing stands in the way of a successful implementation of your ERP system.
Marco Vollmuth ist angehender Wirtschaftsingenieur und spezialisiert auf den Bereich Digital Business. Er selbst betreibt neben seinem Studium und seinem Beruf als Supply Chain Manager ein eigenes Unternehmen, welches verschiedene „Consumer Goods“ im DACH-Gebiet vertreibt. Durch die Erfahrungen, die er in den letzten Jahren dort sammeln konnte, weiß er, wie wichtig automatisierte Prozesse sind, welche ausschließlich durch ERP-Programme abgebildet werden können.