Optimize Business Processes to Limit ERP Customization

Identify the best targets for process optimization and focus on configuration. Just say “no” to everything else.

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Delivering value from your ERP system is hard work. In 2012, under half of organizations who recently implemented an ERP system realized the value they expected from their ERP system.
Customizing your ERP system is extremely expensive and often pushes you off the path to upgrade.
Focusing on configuration will deliver ERP value with minimal effort and increase overall end user satisfaction.

Your ERP system is not about the technology, it’s about the business processes and the people using the system. Focus on these two aspects as a cost effective way to optimize your ERP system.
Some business processes need customization, but most don’t. Identifying which ones are key to your business will help you hone in on where the effort should be best spent.
Discovery workshops are the key to rapidly changing a business process. Build discovery workshops to speed up the optimization process.
You can’t forget to manage the change at the organizational level. Academic research points to a lack of change as one of the key reasons ERP implementations don’t deliver the estimated benefit.

Prioritize business processes that are key to your organization’s success.
Develop discovery workshops that will uncover easy-to-fix configuration problems that will deliver ERP value and improve collaboration in your organization.
Improve key process performance indicators such as, cycle time, defect rates, and service delays.
Introduce ERP optimization as a standard procedure that IT will perform on a regular basis.

Arturo Duque, City of Miami
Brett Feddersen, Government of Boulder, Colorado
Chris Devault, Panorama Consulting
Dan Veneris, Airgas Inc.
Georgina Anderson, McGladrey LLP
Jim Wisdom, City of Lawrence, Kansas
John Staab, Rainforrent Inc.
Mathias Kirchmer, University of Pennsylvania
Nick Staicu, Moneris Inc.
Richard Traeger, MPC Inc.
Robert Jones, UNTSystems
Sheldon Watson, McGladrey LLP
Walter Tota, Litcom Consulting
Zainab Alibaba, Interswitch Inc.
2 organizations contributed information to assist with the development of this project blueprint. Due to the sensitivity of the information, the contributors requested confidentiality.

See how all the steps you need to take come together, with tools and advice to help with each task on your list.

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Define your process improvement SOP

Ensure ERP optimization via configuration becomes a core IT activity
- Storyboard: Optimize Business Processes to Limit ERP Customization
Prioritize and optimize your business processes

Identify which business processes will be optimized first
- Business Process Assessment and Prioritization Tool
- ERP Optimization Program Manual
Launch and monitor the optimized business processes

Minimize the resistence to change through training and monitoring.
- Business Process-Based Documentation Template

This guided implementation is a four call advisory process.

Call #1: Review and justify the prioritization of identified business processes

Identify which priorities are key candidates for improvement.
Call #2: Review identified processes and associated projects

Decide which approach to take to improve the identified business processes.
Call #3: Discovery workshop building and feedback collection

Facilitate internal sessions with staff to analyze processes and identify opportunities for improvement.
Call #4: Understand how to manage ERP optimization change

The improved processes have to be incorporated into the ERP system. Appropriate project proposals are the first step.

Define your ERP process optimization SOP
Identify business processes that are key for your organization’s success
Assess business processes by cost, satisfaction, and opportinuity for improvement
Prioritize business processes to obtain optimization focus

Complete assessment of all business processes in your organization with cost, satisfaction, and opportunity metrics captured and collected
Prioritized list of business processes that are key to your organization’s success
Root cause analysis performed to help identify which future course should be taken to fix the suboptimal business processes

Activities:		Outputs:
1.1	Right-size the ERP process optimization SOP	Developed ERP process optimization SOP
1.2	Identify enterprise priorities	Identified which business processes are the most important to your organization’s strategy
1.3	Provide relevance rankings	Gathered primary data relating to the satisfaction, cost, and opportunity of different business processes
1.4	Assess satisfaction, cost, and opportunity	Performed root cause analysis to determine the future course of intervention
1.5	Generate process optimization plot	Generated process optimization plot to identify which business processes should be prioritized
1.6	Determine course of intervention
1.7	Estimate cost and risks of intervention	Generated data for the business cost, taking into account costs and risks of intervention

Build discovery workshop activities that will deliver ERP value
Develop project proposal to guide further optimization efforts
Understand the components of change that exist when optimizing business processes
Identify best practices for the documentation, training, and monitoring of optimized business processes

Thorough understanding of the seven different workshop activities that will drive the ERP optimization effort
Developed project proposals that can be used to launch further optimization projects
Comprehensive launch plan developed by embracing training, documentation, and monitoring best practices

Activities:		Outputs:
2.1	Build an engaging workshop facilitation guide	Fully developed facilitation PowerPoint deck
2.2	Establish process ownership	Assigned process owners to each relevant business process
2.3	Build process operator workshop teams	Developed list of workshop partcipants for discovery workshops
2.4	Overview of all workshop activities	Reviewed all workshop activities
2.5	Build project proposals	Finalized project proposals
2.6	Prepare for launch of the optimized processes	Thorough understanding of the change management issues associated with ERP optimization