JAN 20 2023 Blog Procurement

Managing an ERP Transition

How to implement a new ERP Transition system without disrupting your business’s important daily operations.

Transitioning from one ERP (Enterprise Resource Planning) system to another can be a headache at best and a catastrophe at worst. It can take years to fully integrate and, if not done properly, can put an untimely halt on daily business operations.

According to global consultancy business McKinsey, 75% of ERP migrations fail. Often these large projects get out of hand, are over budget, and result in negative returns. 

Are you realizing that your current ERP can’t keep up with your business growth? Are you worried about how migration to a new system might impact your business? Keep reading to learn how to avoid ERP migration pitfalls and navigate the tough transition without negatively impacting business operations.

Don’t underestimate the scope

One pitfall many businesses fall into when migrating ERPs is underestimating how large the project will actually be. When scoping out your migration plan, don’t forget to consider the number of people who will be involved or impacted or the amount of culture and process change that will be required of them. We’re guessing it’s more than you might think.

Do not begin an ERP haphazardly or without adequate preparation to change your company culture. Preparation to change culture must happen long before the ERP transition begins to take place.

Also, be sure to evaluate the state of your company and culture– is your business in a place where it could handle substantial change? If not, the time may not be right to invest in an ERP to help you scale. Hold off until your business feels more ready.

Don’t underestimate the complexity

In basic terms, An ERP is a mechanism for allowing different sets of master data to relate to each other. However, it loses all usefulness if the quality of the master data is low. If you only discover that your data quality is low as you transition to a new ERP– you may already be too late. IT can complicate, lengthen, and even crash the transition process. Not to mention make the end result even less useful.

So before you decide to transition, dive into the quality of your data. We all know the importance of data, but keeping track of the quality can be much more difficult than we realize. Be sure that you look very closely at your data and monitor it relentlessly. 

Data will never be perfect, but ERPs lose their usefulness if the data they manage isn’t reliable or truthful. So don’t underestimate the importance of putting in the hard work to improve your data quality.

When you’re reassured of your master data’s quality, the transition to a new ERP will be much smoother, quicker, and interrupt daily business tasks at a significantly lower rate.

Don’t underestimate your role

Sure, you may have just bought the best ERP system in the world, but if you aren’t prepared to do the work, that system will get you nowhere. The ERP is a tool, it’s not a solution in itself. Someone can hand you a shovel, but they can’t dig the trench for you. 

The new ERP system won’t solve your problems in and of itself. First, you need to set up the culture to know the importance of the transition and be prepared to support it. Second, you need to understand the nitty-gritty details of what will be required to make that transition actually happen. Third, you need to evaluate the strength and accuracy of your data– in ALL the different places that data lives– and clean up discrepancies BEFORE you transition. 

The only one who can put the plan into place and ensure the transition goes smoothly is you.

Change processes gradually

Another common pitfall that businesses fall into when transitioning ERPs is making the transition an opportunity to overhaul processes as well. While some, maybe even all, processes will inevitably need to change with the transition, the change has to be steady and incremental. 

It’s important to evaluate your current processes, take stock of what is working and what is not, and change the most essential processes first. Patience is key when making that shift. If you try to force a change too soon, you may find it either takes far too long and disrupts business operations, or your employees end up tired and burned out. 

So be careful when overhauling processes. Prioritize the biggest pieces of the implementation and continually iterate your processes from there.

Make it happen

Put in the work yourself, get your best people on the job, and make that transition happen. It’s definitely not something you want to do halfway. Transitioning ERPs is an all-or-nothing scenario.

However, if you do successfully transition, an efficient ERP can make or break your business–especially as it scales. Making that transition early and smoothly might just be the best thing you ever do.

If you want to level up your procurement data and processes, Graphite will create a foundation for future success, supplementing whichever ERP you choose.

Graphite solutions allows you to centralize your processes and keep supplier information, including risk information, up to date. You can also customize your supplier intake process and centralize where your supplier data is stored and updated– simplifying operations and protecting your company like never before. 

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