What is the Difference Between ERP Selection and ERP Readiness?

As we all prepare to head off to EDUCAUSE 2024 in San Antonio, we wanted to take a moment to discuss a topic we know will be a major focus at the conference – ERP transformation. In fact, ERP transformation has been the focus of so many of our client conversations and projects this year that an unofficial mantra evolved at Moran Technology Consulting (Moran): “ERP Readiness and ERP Selection are not the same”.

As a firm dedicated to higher education IT consulting, a significant portion of our consulting projects have always been ERP-related. That’s even more true today. Schools are ready to transition from the pandemic-era challenges of keeping the ship afloat to tackling projects that will enable long-term transformation. One of the biggest areas of pent-up demand for transformation is in the ERP space. Schools who have been on the same platform for 10, 20, or even 30+ years are tired of unmet needs, custom code, poor or missing integrations, and workarounds, and want to clear those decks so they can spend time focusing on areas of strategic differentiation. Often, the understandable conclusion is “let’s replace our ERP suite”.

This desire frequently gets translated into seeking support with issuing an RFP and navigating the ERP selection process. Unfortunately, when it comes to ERP replacement, completing the selection process is necessary but it is not sufficient for institutions seeking to accomplish ERP transformation. ERP Readiness and ERP Selection are not the same, and we’ve put this newsletter together for IT leaders who are faced with navigating this extremely complex, critical, and typically unfamiliar process so that you can be better prepared for ERP transformation conversations at your institution.

 

We’ve been using the analogy of an iceberg to talk about the difference between readiness and selection because we find that the process of selection is generally better understood and because there is a misperception that it’s the most important part of ERP transformation before implementation. However, about 85% of the preparatory work leading to a successful ERP transition happens outside the selection process. In fact, much of this ERP readiness work can happen before or in parallel to a selection process because it’s platform agnostic!

Here, we’ll focus on four major – yet often overlooked – areas for transformation readiness.

1. Project Governance & Project Management

Why it matters: Strong, clear project governance and project management structures are critical to the success of any ERP transformation project as they are the mechanism to ensure executive support, widespread awareness, and that decisions are made in a thoughtful – yet timely – manner.

• ERP implementation projects require frequent project governance involvement, challenging existing structures that aren’t designed for implementation activities.
• Comprehensive structures contained within the program offer the best opportunities for quick decisions and issue resolution.
• These structures provide a clear pathway for decisions by developing a decision matrix that empowers the project team.

What you can do today:

• Define your Project Drivers and Outcomes – why are you considering ERP transformation? What are you hoping to accomplish?
• Project Governance Structures – If you haven’t looked at your ERP project governance structures to see if they are still meeting your needs recently, now is the time! You should also define the levels of governance for the ERP implementation project, including cadence and participation.
• Decision Making – Agree on what criteria will be used for internal project decisions versus those that need to be raised to the governance process.

Learn more: https://morantechnology.com/blog/maximizing-erp-lessons-learned-in-higher-education-the-role-of-governance/

2. Organizational Change Management (OCM)

Why it matters: OCM helps institutions plan for and shepherd the major non-system transformations that accompany an ERP replacement project, including:

• Identifying and planning for the major vectors of change associated with an ERP replacement (new processes, changing or new roles, adapting to new technology, etc.)
• Stakeholder perceptions of the changes, including preparing them for adoption of the new platform(s) and associated process transformations

Effective OCM can make the difference between project success and project failure. 

What you can do today:

• Begin developing your OCM strategy:
  • Complete a Transformation Readiness Assessment to understand the institution’s readiness for change and identify potential challenges and pain points. This should include considering your past experiences – what has gone well on past major IT projects? What has gone badly? What lessons should you carry forward to this project?
  • Complete a Stakeholder Analysis to identify key stakeholders who can lead and influence change
  • Begin Communications Planning to designate method and frequency of communication beginning in this pre-implementation period
• Get started on BPR: Business Process Redesign is often seen as an activity “we will do during system implementation”.  But implementation projects rarely address end-to-end process inefficiencies, focusing instead on new system operations and processes. Not all business processes can be redesigned prior to implementation, but getting clarity on your current state will support future state improvements, especially because once you get to the implementation your functional areas will be pulled in many directions across configuration, data conversion, reporting, training, testing, etc. Preparing early is important. Here are some specific things you can do:
  • Understand your current state processes for impacted functional areas (e.g., if you’re considering ERP replacement for HR and Finance, focus on your HR and finance processes)
  • Identify process pain points
  • If possible, consider your desired future state so you know what you want headed into an RFP
  • Look for opportunities to make short-term / immediate changes based on those pain points (and document the others to share with vendors as part of your RFP so they can propose solutions!)
  • Look for policy impacts where current processes are dictated or determined by policies, and whether those are likely to need changes moving into a future state. understanding these potential obstacles before the project allows the team to plan accordingly during implementation.

Learn more:

• OCM: https://morantechnology.com/blog/maximizing-erp-lessons-learned-in-higher-education-change-management-and-training/
• BPR: https://morantechnology.com/blog/business-process-redesign-bpr-for-successful-system-changes/

3. Data Readiness

Why it matters: Lack of data readiness is consistently a reason for delays and significant additional expense in implementation projects. Focusing on data readiness in advance can help you surface and remediate potential risks ahead of the project.  In our experience, early intervention can significantly reduce risks, cut implementation costs, foster collaboration, and allow for proactive / gradual actions rather than reactive urgent actions at time of implementation.

What you can do today: focus on preparing your data and understanding your reporting needs.

• Data Quality – Build a current state reporting inventory with usage metrics and business owners.  Pay particular attention to reports that cross multiple platforms as these may require a more involved solution which blends new ERP data with other platform data.
• Data Conversion Environment and Historical Data – Determine the solution for how historical data will be stored, requested, and accessed post-implementation.  This is often an area where implementation firms provide little support and guidance.  Leaving the legacy ERP running is often the first option but it comes with many unintended consequences.
• Data Profiling – Determine the technology that will be leveraged for reporting across datasets in the new system and other legacy platforms.

Learn more: https://morantechnology.com/blog/getting-started-with-data-quality/

4. IAM Readiness

Why it matters: An ERP migration is highly disruptive to current Identity & Access Management (IAM) technology, data, and processes.  It is also a great opportunity to make significant improvements to digital experience, cyber security, and administrative efficiency.  Ensuring you are prepared with an effective and mature IAM program is a critical part of your ERP transformation. Effective aggregation, management, and application of identity and access information is not only critical to a robust risk management program but is a critical aspect of transforming your student and employee digital experience.

What you can do today:

• Conduct an IAM Assessment and Strategic Planning exercise to:
  • Identify strengths and gaps in your current IAM environment
  • Establish an IAM Program to foster business alignment, awareness, and cross-campus collaboration
  • Update and document student, faculty, staff, and affiliate lifecycle requirements and ensure they are aligned to institutional strategic goals
  • Identify identity-related business processes that need to change
  • Create an IAM Roadmap of prioritized actions you can take to develop a mature IAM program heading into your ERP selection and implementation

Learn more: https://events.educause.edu/webinar/2024/enrollment-cliffs-innovative-offerings-and-it-agency

Focusing on these four areas in advance of any ERP implementation – and even in advance of an ERP selection – will prepare you for a faster, more efficient, less expensive, and more successful ERP implementation and transformation project.

Ultimately, for most higher ed IT staff, a major ERP transformation project (readiness, selection, implementation, post go-live) is a once-in-a-career affair. That’s why most institutions end up looking for a partner to help them navigate at least some portion of this process. Our final piece of advice is to look for a partner who is deeply experienced in this space and can help you build your capabilities so that you can achieve the transformative value you’re looking for when investing in these multimillion-dollar projects.

For even more on this topic, you can take a look at our recent EDUCAUSE QuickTalk covering this important distinction: https://events.educause.edu/member-quicktalks/2024/erp-selection-vs-erp-readiness

You can also Contact Us if you want more information. We look forward to seeing you in San Antonio!

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Moran is a highly experienced team of expert consultants serving higher education. We offer a full range of IT and management consulting services. Our consultants have worked with over 320 institutions and conducted over 850 projects across 40+ states and 12 countries.