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Moreover, legacy systems are rarely documented to the level that facilitates a quick and accurate assessment. The processing frequency of a feeder system can also present problems. For example, an online, real time ERP system that receives data from a legacy system that is only updated weekly can create information inaccuracies due to timing problems. One of the first implementation tasks should be the identification of all system interfaces. Monitoring and reviewing the status of interface development is critical to meeting project deadlines. In addition, testing the interfaces is equally as important as testing the software. Pre-defined test data should be prepared and formally processed to make sure that data from other feeder systems is processed accurately and is in the proper format during the system testing phase.
Master Data
It is a cliché, but the best and most functionally rich software is only as good as the master data that supports it. Before master data is entered into a new ERP system, the implementation team must be certain that is complete, accurate and in the proper format. The project team should always expect and anticipate issues relating to missing master data. Often new ERP systems require data that does not exist in the legacy system but is extremely important to the new system because it supports new and critical functionality. Obtaining this new data can sometimes be difficult and time consuming. This task is often underestimated and can result in projects being delayed and over budget. Equally important is data cleansing. Our implementation experience indicates that from 10% to 35% of the data in legacy files contain some form of error. A systematic process must be established to determine that existing data is clean, correct and in the proper format. Whenever possible, it is desirable to use the new application programs, edits and controls when converting legacy system data from the old system to the new system. Master data should never be copied directly from a legacy system without a thorough editing and review process in place.
Customizations
Often companies fall into the trap of customizing new ERP systems. This adds a level of complexity that is quite often unnecessary. Usually, customizations have more to do with the personal preferences of managers and employees than any real business requirement. Many times it is done to recreate reports and support processes that were supported by the "inadequate" legacy system. There are a very few instances when customization is the only alternative. These should be associated with a requirement that truly differentiates the company from its competitors. Customizations should otherwise be avoided. When Software Implementers hear the word "customization" their eyes light up. It greatly expands their role in the project and can add significant cost. The downsides are many. If a customization is too extensive, the software will not accept the upgrades and patches that come as a standard feature of the annual software maintenance fee. The documentation that comes with the software may no longer be accurate depriving IT support technicians of a valuable tool for maintenance and problem solving. Last, but not least, the company runs the risk of voiding the software vendor's "warranty" unless the software vendor contractually supports the customizations. Before a company decides to customize new ERP software, every attempt should be made by the project team to re-engineer existing process or find an alternative process that will satisfy the business requirement. This leads to the next key implementation requirement.
Re-engineer Processes
The technology companies who design and market top tier ERP software today, have spent millions of dollars to make sure that their product offerings conform to the "best practices" of the various industries they support. Many of their development staff members participate in APICS (American Production and Inventory Control Society) and other professional organizations. More often than not, the software package supports a more efficient and effective process than the company currently utilizes. Implementation of a new software system provides an organization with an excellent opportunity to re-engineer and improve existing processes. Bill Gates stated in a recent address to a technology group that, "The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency". Improving processes in conjunction with implementing new software can result in an order of magnitude jump in productivity and cost reduction.
Company Specific Training
The importance of training cannot be over-estimated. Most software vendors provide a training database of generic information. This is an adequate tool for employees to become familiarized with the functionality of the software. However, when it comes to training new users, it is imperative that they do so with data, procedures and processes that are company specific. The purpose of training is to have users become so familiar with the new software that "go-live" becomes just another operational day.
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