Enterprise Resource Planning System Approaches

Enterprise Resource Planning (ERP) is an important tool that allows a business to
integrate its most important components such as finances and operations. Integration of such
parts allows the business to increase its efficiency and improve workflow (Verburg et al., 2006).
These changes are key to making any business competitive. There are two main ways through
which a business can implement new ERP system in its operations. The first one is phased
method. This approach involves incremental or phased adoption of the new system and
replacement of the old one. The second approach involves replacing the old system with new
ERP system at once. In the case study provided, I would implement the ERP system all at once
rather than have it introduced in phases.
There are many advantages of adopting a new ERP in one go. One of them is short time
of implementation. For the phased approach, each phase takes considerable time to implement.
The adoption of new ERP system, therefore, ends up taking a very long time (Kendrick, 2015).
Implementing the system in one go helps the business to save on time as all modules of the new
ERP become operational at the same time.
Another benefit of having the new ERP system go live at once is that the whole company
gets to use one system. Such usage helps avoid the confusion that comes with different systems
being used simultaneously as it is the case with phased implementation of ERP systems where
some departments use legacy systems, others interim systems, and others new ERP systems
(Kendrick, 2015). When all the staff use one system, it becomes easy to solve any problem that
may arise either from staff themselves or customers.
In addition, implementing all the ERP modules at once allows the company to have
focused training of its staff (Kendrick, 2015). When using this approach, all staff personnel get
trained at the same time. Knowing that once the new system is implemented the legacy system
will not be in use again will make the staff put more effort in learning the new ERP modules.
Another advantage of rolling out the new ERP at once is to save costs. For phased
adoption of new ERP, vendor has to provide temporary interfaces between the legacy system and
the new ERP system (Nelson, 2007). Such interfaces increase the cost of implementation.
Moreover, they also require employees to be trained in their standard operating procedures. Such
additional training too adds to the total implementation costs.
Lastly, simultaneous implementation of all modules of ERP provides the company with
quicker return on their investment (Kendrick, 2015). Since the implementation is done at once,
the business is able to realize its benefits much more quickly than in phased implementation
approach.
One major drawback of implementing all ERP modules at once is the huge risks
involved. There is the risk of losing very important data when the old system is done away with
and the new one brought to life (Nelson, 2007). In addition, there may be slowdown in
productivity as employees struggle to perfect their working knowledge of the new system
(Verburg et al., 2006). To minimize these risks, there is need to take mitigation steps. The most
important one is to conduct a thorough end-to-end testing to make sure that there will be no

ERP SYSTEM IMPLEMENTATION APPROACHES 3
problems when the system goes live. The testing should be done multiple times to make sure that
there are no bugs or incompatibility problems (Nelson, 2007). In addition, training of staff for
use of the new system should be thorough.
Implementing a new ERP system is can give a business significant competitive
advantage. However, if done inappropriately, it can lead to data loss, reduced productivity, and
loss of money. The approach of implementing all modules is better than phased approach
because it saves money and time.

ERP SYSTEM IMPLEMENTATION APPROACHES 4

References

Kendrick, T. (2015). Identifying and managing project risk: essential tools for failure-proofing
your project. Amacom.
Nelson, R. R. (2007). IT project management: Infamous failures, classic mistakes, and best
practices. MIS Quarterly executive, 6(2).
Verburg, R., Ortt, J. R., & Dicke, W. M. (Eds.). (2006). Managing technology and innovation:
an introduction. Routledge.