Many organizations have burnt their fingers with half implemented ERP systems or excessive delay in implementation. Valuable management attention gets drawn in correcting a half baked ERP implementation. ERP implementations, though rarely, may also face last mile issues if the change is not handled well.
Below are some guidelines that can help you guard against this risk:
Wrong choice of Product While selecting a ERP software one must pen down business priorities. During the vendor selection process, it is easy to get lost in the vast offering that different ERP companies provide; this could be mobile compatibility, compliance with new statutory requirements, easy customization, cloud based solution, industry specific solution, user friendly interface, global operations compatibility, business intelligence tools etc. Knowing what is important to your business helps in the long term. Inadequate involvement of senior management during implementation It is a misnomer that ERP implementation is the job of the IT function. A comprehensive ERP often touches all departments in an organization. A deep drilled software implementation may expect changes in processes. Involvement of senior business representatives will ensure processes across departments are tied and ration atomization to keep business focus. Implementation timelines get extended Implementation timelines can get extended because of inadequate initial analysis i.e understanding of current processes v/s desired processes for better business capability. In the absence of a priority list of customization requests, the client will guide efforts as per his/ her frame of reference. A good ERP vendor will freeze requirements with department heads and further prioritize the list with the help of the ERP champion/ steering committee.
Change of members of ERP implementation steering committee
It is often experienced that members of the ERP steering committee are allocated other important assignments before completion of ERP implementation; sometimes key members may leave the organization, both of which bottlenecks critical implementation results. Every member of the steering committee is chosen carefully and has a role to play in a successful implementation.
Parallel off-line processes running too long
Even months after the ERP has been implemented, you may find executives maintaining offline records. They may be spending expensive executive time to keep offline & system records tallied. This could happen due to rigidity of ERP product or due to lack of internal processes. Business representatives involved in the ERP implementation need to drive, early on, customization and/ or process discipline. Good ERP vendors generate a full set of online reports from each module before announcing it as implemented. Devesh Gor, has over 25 years of experience in ERP sales and implementation and is currently associated with SymcoPlus. Symco, a pioneer of software packages in India, is engaged in ERP systems and development of industry specific systems. Symco Plus is a consultancy unit specializing in building ERP driven financial care monitoring systems for business organization. In the highly competitive business scenario, they provide a comprehensive structure and processes for planning and control for SMEs' specific business and a sound deployment of modern day technology facilitating management of operations with real-time anywhere access to key information. Symco Plus is a part of a group of service units engaged in providing diverse services which collectively and comprehensively form financial care for business organizations including Information systems.
Imagine you were to select the right steel required for safety pin manufacturing. There are 3500 different grades in steel. To rationalize your choice of steel strength and weight it is best to anchor choice to "What is the use of a safety pin?" Degree of customization required while implementing an ERP follows the same philosophy. Written clarity of ERP's use to business at an early stage of implementation helps.
You may often see users preparing a 'wish list' during gap analysis stage of ERP implementation. At such times a rigorous look at the list may be required. Once the ERP is implemented and in use for 1-2 years, user may approach with customization requirements. Post-implementation customization requirements are different, a single request may snowball change requests in other dependent modules.
The 3 principles you may follow for yes or no decisions on ERP customization are:
Create a panel to sign-off each customization requirement that comes: A panel of business, IT & ERP vendor team must strictly sign-off each customization requirement. It gives a balanced view between achieving returns from expenditure on ERP and meeting business needs. Ideal number of members of the panel depends on the size of the organization.
Let the vendor take lead in facilitating first priority list of customization: An ideal vendor, during ERP implementation will take lead in facilitating a priority list of customization. The ERP vendor team closely works with organization's employees during implementation. SME's often may have very senior or young employees in pockets. Seniors are often comfortable with set methods and may not be comfortable handling change in processes. Youngsters on the other hand may give undue importance to having technology savvy features. The vendor representative has enough information to do a first level churn of customization requests list. Alternate but existing ERP features may meet user needs. Sharing perspectives of other departments may give users a broader understanding of business needs and help gain acceptance of existing features.
Use flexible technology platforms to meet urgent information needs: iDesk of Symco ERP is an excellent management reporting platform. Technologically it can process code based output and also PDF based output. Customers have used the flexible option for months before they decide they do not need a certain information set or may need it in an evolved automated form. Pushing a customization request therefore either dilutes a felt need or brings out the financial viability of it. A complete ERP implementation is like have a full course meal, flexible technology platforms like iDesk are like having brunch. If a product shows up more that 20% customization requirement, it may not be a right fit for your industry/ company size. Also, the technical challenges, of managing a customized code v/s a standard product code, are best known only to the vendor. ERP products evolve over the years because of addition of industry competitive customization requests to its standard feature list. However, in most cases customized product code maintenance is complex and if blown out of proportion may shoot-up annual maintenance contact rates. Devesh Gor, has over 25 years of experience in ERP sales and implementation and is currently associated with SymcoPlus.Symco, a pioneer of software packages in India, is engaged in ERP systems and development of industry specific systems.
ERP software Cost: There are two common pricing methods that are provided by ERP software companies, ERP is available on pay per use basis (SAAS) or is sold as a license, where you make a one-time payment for purchase of the license. SAAS is more like a year-on-year revenue expenditure. The ERP license purchase option has a capital expenditure of purchase of license and a revenue expenditure of maintenance costs. In case of license purchase the number of users may be unlimited or packed eg maximum 10 users.
Hardware Cost: In case of SAAS the costs for the vendor are also that of a web server, uninterrupted internet access, temperature control, data backup infrastructure, firewall, anti-virus software etc. All of these are built into the per user cost typically with a minimum number of user expectation. In case of license purchase, the software may be hosted on your local server or your web server or vendor's web server. Such server if purchased will involve maintenance. Server's space or full servers can be rented too.
Server License: Organizations with presence in remote areas that have poor internet connectivity purchase local server. Data from this server is synced and replicated with the central server at regular time gaps and whenever connectivity is smooth. This ensures work does stop due to poor internet at the same time information is updated centrally at almost real-time. Windows/ Linus server license cost is to be added as a one-time cost. Anti-virus, firewall and other such software licenses too may have to be installed on the server. A remote desktop license is needed if the software is not a web application. SAAS may not be a good option where internet connectivity is poor.
Annual Maintenance Contract: In case of ERP license purchase you might need assistance from the vendor to keep the software up and running. Annual Maintenance Contracts are around 15-20% of license costs and are additionally paid annually. SAAS builds these into the per user cost.
Implementation costs: Different vendors charge different rates for software implementation. They typically involve gap analysis, master updating, training etc. This could also be at the rate of man days required for implementation.
Travel: If your ERP software vendor is based in a different city as compared to yours or if you have presence in multiple locations, he/ she will charge travel, loading and boarding at actual during ERP implementation. This may be optimized if the ERP vendor has local partners. Check possible costs under each head before selecting an ERP vendor partner.
Symco was founded, as an accounting package, by gold medalist Chartered Accountants in year 1986. Within a year build other modules integrated with Financial Accounting, each with strong functionality.
About ERP (Enterprise Resource Planning):
SAP is module base fully integrated, sophisticated, well tried and tested and globally accepted ERP software. Tally is integrated among various functional areas; there is no module concept in Tally. Symco is a module based fully integrated, robust ERP software, used for local & global operations; with a loyal user base.
SAP is a Comprehensive ERP with all modules viz. Financial Accounting, Controlling, Assets Accounting, Customer Relationship Management (CRM), Financial Supply Chain Management, Human Resources (HR), Investment management, Materials Management, Product Life Cycle Management, Plant Maintenance, Production Planning, Project Systems, Quality Management, Sales & Distribution, Service Management and Business Intelligence for reports. Tally is integrated among various functional areas, like Accounting, Finance, Inventory, Sales, Purchase, Manufacturing, Payroll, Costing, Job Costing, Legal Compliance etc. which are part of the standard software and automatically integrated by default subject to quick setup. There is no module concept in Tally. Symco is a comprehensive ERP with modules, for manufacturing & service organizations, viz. Financial Accounting, Order Processing and Invoicing, Export Documentation, Purchase & Inventory Management, Production Planning & Monitoring, Sub Contracting, Costing & Cost Control, Fixed Assets, Human Resource Management & Payroll. iDesk for Budgeting, Budgetary Control & Management Reporting. User has an option to generate customizable reports. Both with Symco & SAP, any logical combination of modules can be implemented and integrated as per requirement. Tally, though implemented as Tally ERP, certain areas of the software do not talk to each other.
Cost of Ownership, Implementation and Maintenance:
In case of SAP, cost of ownership is high. Organizations purchase select modules and often budget for customization too.Cost of Tally product is affordable, even for proprietor setups. Symco has flexible pricing, can purchase license or pay per use. SME with corporate offices in cities and manufacturing/ operations in remote locations with low internet connectivity find Symco solutions of hardware & software setup, affordable. Implementing and integrating SAP is considered as a project as it involves long term planning, high investment and gestation period. Tally on the other end, can be implemented quickly. It is as easy as thinking of a product, buying it either online, read instructions and start using it.
Symco has one of the best ERP implementation team. SME owners, with mixed talent of experienced and professional staff, are often concerned about actually usage of ERP. Symco's phased implementation of modules with first hand training eases change pressure. ERP updates are provided as part of maintenance. User friendliness, Training & Learning, Software support, Third party software compatibility, Suitable for: SAP is not very user friendly. Tally on the other hand is absolutely user friendly. Symco too has a user friendly interface. One cannot learn SAP functionality independently. It requires professional guidance and training. Tally is very easy to learn as educational version of the software is available along with supporting help files, online. Symco requires minimum training and has inbuilt support file. SAP requires strong IT team to keep the product running. Organizations often develop internal team.Tally provides 24/7 software support. Symco boasts of a strong software support team SAP has very high and reliable communication with third party software. Tally does not have very good communication with third party software, as it is developed with a core proprietary engine. Communication with third party software is possible in case of Symco, with planned effort SAP is good and advisable only for large scale business having multinational, cross border, multi-location operation with multi point control. Tally is good and advisable only for small and medium scale business where data volume is not very high and entire operation and management is very closely controlled. Symco is good and advisable for Small, Medium and Large scale business having multinational, cross border, multi-location operation with multi point control. Technology, Speed and Data Handling Capacity: SAP has a three tier (R3) database technology. Completely based on coding. Tally is code-less ERP System developed with a core proprietary engine and a Software Development Kit namely Tally Definition Language (TDL). Completely based on coding, Symco has a powerful Database MSSQL with Hybrid solution of client server and web based IDesk SAP processing speed is not very fast but it can handle huge volume of data. Tally is lightning fast but it is true only up to certain level of data volume. Symco's processing speed is good and can handle large volume of data.
The biggest challenge for ERP software companies, lately, has been that of remaining technologically relevant. Large complex products developed in a certain technology, if required to be updated to a new technology will involve rewriting millions of lines of code. Breakeven period for such huge investments are long. With even more frequent changes in technology combined with scarcity of skilled workforce make technology upgrades a nightmare for product companies.
Long standing product companies have to include standard product code plus customized code for existing clients in the technology revamp projects. Quality testing both functional and technical takes its own time. Technical complexity increases to make systems work across multiple mobile operating systems such as Android, Windows, iOS, and different search engines viz Google Chrome, Internet Explorer, Mozilla Firefox etc or even the coding technology. Fortunately backend systems for product software has remained the same viz MySQL, Oracle, MSSQL etc
With immense competition within ERP software companies, customers would not wish to share vendor spends on technology upgrade. They would be reluctant to accept free upgrades if it involves expenditure on license/ hardware costs. They would be comfortable to continue with existing technology unless it affects business. Millennials however are used to new technology and might get intolerant with old systems.
Internal staff with knowledge of old technology cannot be trained overnight in new technology nor can they be replaced insensitively. Most product companies invest in technical training of their staff.
Depending on size, any technology change takes 6 months to even 2 years to stabilize. Companies take this time and cost risks to stay relevant for emerging industries such as ecommerce, analytics etc and also GenY.
Long standing ERP software companies would have changed from DOS to Windows, from Fox Pro to php/.net, from desktop view to responsive HTML mobile view; it is to see how mobile watch changes expectations again.
Product software companies try and adopt affordable solutions such as partial updates to say mobile apps or module specific updates to cloud/web technology.
Symco, a pioneer of software packages in India, is engaged in ERP systems and development of industry specific systems.
Symco Plus is a consultancy unit specializing in building ERP driven financial care monitoring systems for business organization. In the highly competitive business scenario, they provide a comprehensive structure and processes for planning and control for SMEs' specific business and a sound deployment of modern day technology facilitating management of operations with real-time anywhere access to key information.
Devesh Gor, has over 25 years of experience in ERP sales and implementation and is currently associated with SymcoPlus. Symco, a pioneer of software packages in India, is engaged in ERP systems and development of industry specific systems. Symco Plus is a consultancy unit specializing in building ERP driven financial care monitoring systems for business organization. In the highly competitive business scenario, they provide a comprehensive structure and processes for planning and control for SMEs' specific business and a sound deployment of modern day technology facilitating management of operations with real-time anywhere access to key information. Symco Plus is a part of a group of service units engaged in providing diverse services which collectively and comprehensively form financial care for business organizations including Information systems. Symco Consultants Pvt Ltd (SCPL) Altius Advisory & Management Services Shreejikosh Services Pvt Ltd (SKSPL)
Head Office : 165, Shivshakti Estate, Opp.Mittal Estate, Sir.M.V.Road, Andheri(E), Mumbai-400059, India
A/3 Krishna Kunj, Vallabh Baug Lane, Near HDFC Bank, Ghatkopar (E), Mumbai-400077, India
Monday-Friday : 10:00 am to 7:00 pm
Saturday : 2nd & 4th Day off
Sunday : Day Off