Important Questions and Answers: Post Implementation of Enterprise Resource Planning

POST IMPLEMENTATION

1.     What do you mean by value analysis?

Value analysis- each activity in the process is analyzed for the value it adds to the product or service. The value added is an increase in a product’s or service’s value, from the perspective of the customer.

2.     What is meant by software updates?

ERP vendors constantly resolves the issues that exist in the system and implements the new best practices and incorporates the changes to the system as suggested by the customers in their feedbacks.

03. What is competitive advantage?

Adding  new  features  and  functionalities  would  give  the  organization  the  power  to

overcome its competitors.

4.     What do you mean by global access?

Global Access includes the features and updates designed to increase the flow of information from and the customers and business partners that can increase the ability to operate globally.

5.     How to reduce the ERP maintenance cost?

1.     Negotiate with vendor

2.     Less software customization

3.     Identify external support

4.     Negotiate service rates

5.     Direct and indirect maintenance costs

6.     State the process of ERP maintance?

i.                   Preventive maintenance

ii.                 Emergency maintenance

iii.              Software updates

7.     State the forms of post implementation activity?

Early enhancements Later enhancements ERP system switching Late switches and reverts

8.     What do you mean by data migration?

Data migration is the process of transforming data from the old format to the new system format.

9.     State the role of ERP consultants.

The consultants support the organization in identifying the best ERP package which suites the business and he is responsible for the success for the ERP package implementation.

10.                        Define Gap analysis.

Gap analysis is the process of analyzing the deviations and bridging the gap between the existing system of the organization and business requirements and the newly implemented ERP system.

POST IMPLEMENTATION

01. How does a company ensure that its ERP investment pays off in increased profitability?

The key challenge is not in managing technology, but in managing people. An ERP system changes how people work, and for the system to be effective, the change may have to be dramatic, going beyond the way employees interact with the software to the way they perform their tasks. Furthermore, business processes that are more effective require fewer people. Some employees will no longer be needed. It is no small thing to ask people to participate in a process that may not only change their day-to-day activities, but could

also eliminate their current jobs.

Managing the human behavior aspects of organizational change is called organizational change management (OCM). Do not underestimate the importance of this aspect of the implementation process. One of the keys to managing OCM is to realize that most people do not mind change, they mind being changed.

If the ERP implementation is a project that is being forced on the employees, they will resist it. If employees view it as a chance to make the company more efficient and effective by improving business processes—and if these process improvements will make the company more profitable and therefore provide more job security—there is a greater likelihood that employees will support the implementation efforts.

As mentioned earlier, the best way to improve a business process is to have the people most familiar with the process leverage their experience and creativity to develop process-improvement ideas. When employees have contributed to a process change, they have a sense of ownership and will be more likely to support the change.

Implementation Tools

The left side of the Solution Manager screen shows a hierarchical menu structure that organizes each step in the implementation, and on the right side of the screen are the detailed items, the descriptions, documents, white papers, tools, and so on to support each step.

02.Explain the issues of ERP Implementation?

ERP implementation is expensive (with costs ranging between $10 million and $500 million, depending on company size). The costs of an ERP implementation include the following:

•   Software licensing fees—ERP software is quite expensive, and most ERP vendors charge annual license fees based on the number of users.

•    Consulting fees : ERP implementations require the use of consultants with the skills to configure the software to support the company’s business processes. Good consultants have extensive experience in the way ERP systems function in practice, and they can help companies make decisions that avoid excessive data input, while capturing the information necessary to make managerial decisions.

•  Project team member time: ERP projects require key people within the company to guide the implementation. These are team members who have detailed knowledge of the company’s business. They work closely with the consultants to make sure the configuration of the ERP software supports the company’s needs, which means these workers are frequently taken away from their daily responsibilities.

•  Employee training: Project team members need training in the ERP software so they can work successfully with the consultants in the implementation. Those team members also frequently work with training consultants to develop and deliver company-specific training programs for all employees.

•    Productivity losses: No matter how smoothly an ERP implementation goes, companies normally lose productivity during the first weeks and months after switching to a new ERP system.

To justify the costs associated with an ERP system, a company must identify a significant financial benefit that will be generated by the use of the software, but the only way a company can save money with an ERP system is by using it to support more efficient and effective business processes. This means that an implementation project should not just re-create the company’s current processes and information systems, although that is a possibility since SAP provides the source code with its ERP package.

A company could choose to alter the package through SAP’s internal programming language, called Advanced Business Application Programming (ABAP)—which access to the SAP ERP source code, it is possible for a company to spend a significant sum of money on software code development to avoid changing a business process to the best practice process designed into the ERP software.

Many companies have difficultly handling change and prefer to continue doing business as they always haverather than adopting the best practices built into the ERP system. As part of the implementation, a company must also manage the transfer of data from its old computer system to the new ERP system. In addition to managing master data such as materials data, customer data, vendor data, and so on, a company must also transfer transaction data, which includes sales orders and purchase orders, many of which are likely to be in various stages of processing—a challenging task.

3.     State the process of ERP Maintenance in detail?

1.     Preventive Maintenance

02. Emergency Maintenance

03. Software updates

4.       Upgrading during maintenance

a.     Competitive Advantage

b.     Global Access

c.      Integeration option

d.     Best practices

e.      Cost Reduction

4.     Write down the impact on implementing ERP systems in Organization.

·        Enhanced operations

·        Easy upgrade

·        Improved productivity

·        Reporting made easier

·        Improved accuracy and consistency

·        Better integration

·        User friendly

·        Improves Communication

·        Reduces cycle time

·        Decreased operating costs

·        Supports daily activity

·        Aligned process

·        Strategic planning support.

5.     What are the factors affecting the post implementation process of ERP?

·        Customization

·        Post implementation training

·        Top management support or influence

·        Post implementation benchmarking

·        Change management

·        Maintenance of ERP

·        Introduction of additional features at the post implementation phase

·        Success of activities at pre-implementation stage.