Posts Tagged ‘erp implementation’

The top three critical factors for a successful ERP implementation are the proper establishment and execution of a training plan, data migration plan, and a comprehensive implementation test plan.  From my experience, the proper establishment and execution of a comprehensive implementation test plan is perhaps the most overlooked of the three plans.

The test plan needs to be representative of how the company does business as a whole and should include the following:

• Customer-facing (i.e., quote to cash, customer service, customer self-service);
• Operational (i.e., demand to pay on the procurement side, inventory management and warehouse operations, manufacturing planning and execution); and
• Compliance and control (i.e., financial management and reporting, lot traceability, quality management, industry compliance).

Let’s discuss how a company goes about establishing a comprehensive implementation test plan.  The starting point for the creation of a test plan can be to select some 50-100 customer orders out of the existing customer order files at random.  Experienced personnel can review these randomly-selected orders to make sure they collectively establish how the company does business as a whole.  Should there be some nuances that need to be added, specific customer orders meeting those scenarios can be pulled from the files as well and added to the list.

Assuming you did a good job of establishing a software demonstration script during the software evaluation process, the script can be another key input into the test plan creation process.  The test plan should consist of a series of test scenarios which may also be called “use cases.”  Associated with each test scenario would be some narrative about what is being tested, specific data that is to be used in the test, and the expected results of the test.

The test plan should also include some test cases to stress test the system to verify there are no issues with data tables that need to be re-indexed or infrastructure bottlenecks that need to be addressed (network capacity, memory requirements, processor speed, etc.).

The test plan should be executed by functional end user personnel – not just a couple of IT people running through the process by themselves.  There are two key benefits to this process.  First, the functional end users will be aware of nuances that may not have been addressed in the existing test cases.  These process anomalies need to be identified and added to the test plan.  Second, this process reinforces the training functional end users have received to date to verify whether or not additional training is necessary to ensure a smooth go live experience.

The test plan document should include space on each scenario to document the actual results of the test, the names of the individuals who performed the specific test case and the date it was performed, and any pertinent observations made during the test run.  Results should be documented in writing – or electronically – so the results can be shared with the implementation core team consisting of both customer and software vendor personnel and the customer’s executive sponsor.

The test plan should be a living document, which is updated as the business changes over time.
The test plan should be re-executed when a version upgrade is being implemented to validate there are no business processes that have become broken as a result of the upgrade process.

Additionally, a good rule of thumb for ERP software system enhancements is to establish the associated functional test plan or use case for that enhancement at the same time the enhancement is being defined.  This incremental portion of the test plan can be incorporated into the overall test plan.

By effectively establishing and executing of a comprehensive implementation test plan, companies implementing Enterprise 21 can expect their go live experiences to be as smooth as possible with the successful entry, picking, packing, shipping, and invoicing of customer orders day one.

One of the key elements of any enterprise software implementation is data migration.  Exactly what data is migrated to the new system in what level of detail is a key decision point to be considered during the implementation process.

To be able to make a well-informed decision about what data to migrate, manufacturing and distribution organizations would be well-advised to start with the target of where they want to be with their new system and work backwards.

Assuming there is any reasonable amount of legacy data, the decision to migrate existing data to the new ERP system rather than manually rekey the data becomes obvious.  Data can be categorized into five main buckets:

• Core base data: including products, customers, prospects, vendors, and associated contacts;
• Pricing data: customer pricing and vendor pricing;
• Facilities, manufacturing, and product unit of measure conversion data: including bills of material, formulations, and routings; facilities layouts including zones, locations, and bins; and product-specific unit of measure conversion factors;
• Historical data: sales history which can be used as an input to generate a forecast and for sales analysis purposes; and
• Open transactions and beginning balances: including open sales orders, open purchase orders, open sales quotes, open returns, open customer invoices (accounts receivable), open vendor invoices (accounts payable), and general ledger balances by account; these items must tie to corresponding values in the legacy system (i.e., inventory stock status, general ledger trial balance, aged accounts receivable by customer, and aged accounts payable by vendor).

Once the data migration strategy is defined, the next step for the ERP implementation project team is to execute that strategy successfully.  Data migration tends to be an iterative process which can be run three to five times during software implementation.  After each test migration, the data must be analyzed thoroughly to make sure the resulting data in the new system is correct and matches up with proper expectations and comparable data in the legacy system.

For a new ERP system to function properly and provide accurate transactions and business information to be trusted for analysis purposes, the core data, which is the lifeblood of the new system, must be accurate.  The migration of data from legacy systems is a critical success factor for ERP software implementation.