• Choate Morales publicou uma atualização 2 anos atrás

    Traditional ERP Implementations

    Traditional ERP implementations can be extremely high-risk, for both the partner deploying them but for the customer. This is the reason no one supplies the elusive fixed fee. The hazards are merely a lot of.

    The existing Dynamics NAV project costs were high because legacy methods are costly. The normal implementation follows several phases originally put down by Microsoft in a waterfall project framework. Waterfall project management software has been confirmed to get higher priced as opposed to modern “agile” approach, which is based on LEAN techniques.

    The approach that has been used by virtually everyone since ERP has been online is usually to bill “Time and Material.” Because of this customers purchase some time spent by consultants, nomatter just how or bad they are. This moves danger in the implentor for the customer almost entirely.

    The reality is that it is possible to massive risks to the partner with your waterfall projects. I have seen MANY cases where partners were sued or threatened when these projects go very badly.

    I began thinking about how we necessary to change this after reading a LinkedIn post that shared a piece of writing on why “Time and Material Billing is Unethical.” I had been really struck by the arguments. The author asked an issue that we think summed it down fantastically well:

    In case a restaurant charged you for that serious amounts of material it popularized cook your steak, how would you feel?

    This probably sparked my first real thoughts about the way to stop as being a some time to material business.

    ERP Costs are incredibly unpredictable

    The primary videos which i uploaded to YouTube was my explanation of why traditional costing of ERP implementations was outrageously inaccurate. I’ve spent time since finding out solutions to remove that inaccuracy.

    Obviously the easiest method to give accurate estimates ended up being to be fixed fee. The trouble is that traditional approach is really risky for your partner. Celebrate it truly scary to supply a fixed fee. unless you do it properly, you have a lot of trouble. I’ve worked very difficult to develop a strategy which i think is different.

    Applying LEAN Thinking to ERP Implementations

    There exists a movement to make use of LEAN thinking to service activities. Generally speaking, LEAN is all about removing waste from your physical product, but it can be applied to projects too.

    I invented my very own variations of waste in ERP projects.

    First – there is certainly time spent by the wrong resource.

    This can be typically if somebody who costs too much does something somebody who pays significantly less can do, or are able to do it faster.

    Second – you can find unnecessary steps

    I have found such a thing happens when individuals perform steps to “cover their butts.” Plenty of project management falls into this. In addition, it occurs when consultants (compensated on hours billed) push unnecessary work.

    Third – there are wasted tasks

    Sometimes customers want to do issues that we, as ERP consultants, know will not work. Within a traditional implementation we have no economic motivation to prevent it.

    Lastly – there exists a “bleed” of data

    Rise around the customer. Typically it’s once the customer doesn’t remember their training because they do not spend some time in it enough.

    Why ERP Implementations Have to Change!

    When we started doing cloud based ERP implementations with Microsoft Dynamics NAV it was common for clients to spend $100,000 for that software and pay $200,000 because of their implementation.

    When you enter in the whole world of the cloud, where Microsoft Business Central is $100 a month per user, things change. It’s hart to see a client they’ll spend $2000 per month for software but still pay $200,000 for implementation.

    So we did what our customers do. We set an expense we thought industry would support, and that we worked backwards to regulate our internal costs and make money doing that. Our company is manufacturing companies. They must estimate a cost, then stay with it. They can not visit their customer and say “we should bill you more because i was inefficient in our production process.” They’d go out of business overnight.

    The brand new approach to ERP implentations.

    I’m more of a manufacturing expert than a technology expert. Few manufacturing companies think with regards to projects with project managers (Engineer to get could be the exception). Many of them think in terms of operations managers and standard work instructions.

    I applied this thinking to ERP projects. It will help that every carry out is implement ERP for companies.

    Here’s are the main steps that helped us dramatically decrease the risk (and costs) of ERP projects.

    We just do one kind of projectFocusing exclusively on manufacturing, along with small facilities, meant that we could refine and obtain better with every project. We look at the process as a repetitive, repetable process. This process gets rid of the beforehand style of the job plan etc. The work management goes away, and we reduce that waste enormously.

    We offset easy but tedious attempt to the customerWhen a $200 per hour consultant does what depends upon a clerical task, that is waste. We train the customers to complete some of the tedious tasks. It turns out that forms of superior made by the consumer. Business Central makes a lot of this easier since it has great tools for customers to do tasks that had been hard. There are two of the specifically that are key: Reports and knowledge Loading

    We train people to edit formsCustomers know what they really want their invoice to check like. They know where they want the deadline on the PO. It’s way easier whenever we teach them to switch these things than do it on their behalf.

    We train visitors to load data into the systemData loading is often a task we assign into a co-op student after a couple of hours training. The fact is, when customers “get” how this can be done – they do a far better job cleaning their data and things go much smoother!

    We keep training sessions shorter and VideoPeople forget what they’re taught. Without question of life. You’ve got a lot on the plate. Also, the more a person spends in training – greater they “zone out” and initiate to reduce focus. We keep training sessions short, and record these as videos. People absorb increasingly can certainly review what they’ve got forgotten. This means we absolutely must train remotely. Travel time can be a killer (and totally waste)- therefore we can’t travel.

    We keep the project tight, and discourage changeTraditional ERP partners encourage work. Work means extra profit. Not for people. Whenever we perform a Business Central project, we discourage any changes through the original project. Our projects aren’t super restrictive – however they do limit the functions we will implement in “Phase 1.” By continuing to keep the program tight, there’s a lot less “creep” and the boss is normally much happier.

    We still bill for customizations, but discourage them also Customizations are the one thing we can’t predict – so we also discourage them. Considering this new model, look for customers require a lot fewer also. They trust us more to know what we have been doing. Occasionally a customization is simply a no-brainer, and in those cases we support and in many cases encourage them. Nevertheless – we’ve got less than half the customization we accustomed to.

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