With the implementation of a new ERP or OMS, companies need to assess end user and IT department skillsets, which are often dramatically different from what’s needed to support legacy systems. Department managers will also be tasked with learning how the new platforms work, and mastering individual functions like data repositories and reporting tools.
Given these requirements, it behooves you to assess how much change such an implementation requires for IT staff and user management. This learning curve impacts not only the project cost but the go-live timeline. To help you navigate this difficult process, here are 5 key areas to assess:
What changes in IT operation and support will the new system create?
Do you want to use online or batch processing? How about SQL vs. proprietary databases? New systems may use HTML, .Net and other modern languages vs. others that have been rendered obsolete. Client-server software used for transactional processing may be new to your organization. Assess how changes in IT platform changes skill requirements.
Does your IT staff have conversion experience?
While they’ve handled other implementations, OMS and ERP often replace many other systems and change processes (call center, warehousing, inventory control, accounting, etc.). Most IT personnel don’t have this experience on their resume. Here are some challenges to deal with:
- Proper sizing of hardware from legacy to new systems. It’s not simply a matter of recreating your current system configuration and storage needs. Vendors will give you specs, but this is often an area where the amount of equipment needed is underestimated. Will reports be run from production servers or a report server? Are you setting up separate incidences (or system copies) for production, testing and training? What about for system redundancy, backup and recovery options? We often see systems undersized by a factor of 2X in terms of plan vs. installed.
- System integrations. Most conversions have at least 15-20 interfaces with other corporate systems (ecommerce, data warehouses, accounting), outside services (catalog printers, marketing services) and vendor systems and portals. When considered at the transactional level, they can explode into dozens to hundreds of individual data flows. Integrations thus involve some of your longest lead items. Does your staff have this experience, or should you use contracted or freelance services?
- File conversions. Another long lead time item. The most common misconception is you need to convert all the legacy data via programming. In many systems there are hundreds of data files and tables required to make the new system operational. Look critically at what files you will convert (customer, item/product, order and return history, etc.). Other major files such as inventory, new promotional files and charts of accounts should be manually entered. It will be faster, cheaper and more accurate. In the planning, agree with your VAR on which files, data feeds and history to include. Again, is this an in-house capability or do you need outside help?
What formal courses does the vendor have?
Are they online or classroom training? Are they held on site or off premises? Review the course curriculum. Self-paced programs abound but they are tedious and I don’t think as effective as classroom training. A vendor’s ERP training will not include the specifics for the VAR layer. For a major ERP system conversion we have seen training costs of $50,000 for IT and users. Be sure you know the extent and content of the courses, and include the training time and learning curve in the project plan.
Do you need to hire new personnel?
That’s easier said than done. You can hire managers and programmers experienced with the language and database, but it’s hard to hire people experienced with the application system, especially the VAR layer. You can hire IT managers who have done conversions, which is helpful, but new people don’t know your systems and culture. Understand what skillsets and implementation times are needed. Look to the VAR to provide services, but at an additional cost.
Don’t forget your staff’s day-to-day responsibilities
Recognize that IT skillsets may become the limiting factor in how quickly you can implement the new system and support yourself without incurring additional expenses.
Curt Barry is president of F. Curtis Barry & Company