Implementation of SAP ERP is a strategic step for an organization. Generally, the strategy is to use SAP ERP as an accelerator for business transformation. ERP supports core businesses and enables the organization’s growth. However in reality, many organizations also experience challenges in ensuring value realization from their SAP ERP investments.
This phenomenon is very common with those who have embarked on SAP ERP journey but have not consciously implemented business benefits realization and optimization practices. Unless SAP ERP is utilized to its maximum extent, every day-to-day business transaction will not be present in the system. Low SAP ERP usage results in multiple information sources and data redundancy. In turn, management will have less faith in the data and will not be able to take reliable business decisions.
It is very essential for an organization to measure its ERP usage across the organization. It has been generally observed that the usage is not consistent across organization. This is especially true for larger organization having multiple business units and geographical locations.
The big question is how to conduct this usage assessment, when to do it, and how to improve usage.
Let’s first define usage. The usage of an ERP system has three elements
|Processes configured in ERP||
Carrying out the business transactions using ERP for all the processes configured in the system. It is generally observed the not all processes are uniformly adopted by the user community. Many processes though configured in ERP are performed outside in legacy or user developed solutions or in spreadsheets.
|Processes not configured in ERP||This should be an area of focus for the management and IT teams. Having invested in ERP the aim should be to leverage all available features and functionality offered by the product. There should be a focused attention and plan to implement these functionality and do away with the multiple legacy and user developed solutions supporting these processes|
Performing the transaction at the right time. It is just not important to perform the transaction in ERP, doing it at the right time is also equally important. For e.g. it does not make sense creating a Goods Receipt few days after receipt of material or creating an Opportunity just before creating a Sales Order. This kills the basic purpose of it being an online transparent system and proves to be a hindrance in management reporting
So how do we measure usage: There are multiple ways to measure usage from simple to highly complex (based on tools and statistical analysis). It is recommended to use the same method consistently to be able to detect improvements. Listing below a couple of simple methods
- System Analysis: This method relies on transaction usage data. Identify important transactions in each processes area and review usage of these transactions by the user community. For larger organization it is essential to segregate user community in Business units/Geographical areas. This will give a perspective of usage across these units. This type of assessment is purely from system perspective and does not provide for inputs from user community and hence misses out on qualitative and time aspect the assessment.
- User Interviews: This method incorporates the user perspective and time aspect. In this method a sample representative users are selected across different business functions and geographical units. This give the users perspective on low usage and non-adoption of the processes in ERP. This helps the management to incorporate the corrective actions necessary to improve adoption
It is never too late to do a usage assessment, but the earlier it is done the better it is for the organization to improve the utilization and realize the benefits from the investments made
Typical Reasons for Low usage: There are multiple reasons observed for low usage. Some of the most common are listed below:
|Business process Enablement||
Many organizations during implementation do not give due consideration to all user requirements. This is primarily due to implementation pressures, insufficient requirement gathering and budget restrictions Many of this requirements are pushed to post implementation, which many a time never materializes
|Training||It is observed that many organizations do not have an ongoing training strategy for ERP users. Training is done during implementation, but subsequently there is no focus on this. It is left to the Power User and business community to upgrade their skills as well as train new users. Over a period of time the Power User network also disintegrates leaving the end user community clueless, and they in turn start developing their home grown solutions to support their business and reporting needs, blissfully unaware that these are available in the implemented ERP system|
Business – IT Alignment
|Some organizations do not have a framework to capture ongoing user requirements. The user requirements not fulfilled during implementation as well as new requirements arising at a later date do not get addressed as needed. This again results in user dissatisfaction and lowers system utilization as the user has to resort to external means to address these needs|
|Change Management||An ERP implementation should always accompany an effective Change Management Initiative within the organization. Many ERP implementations restrict Change Management to just training which is insufficient. It is not easy to wean away business users from their legacy and home grown application. Change Management needs to continue during and for some time after implementation to ensure a smooth the transition to the ERP system|
Improving utilization of the ERP system has to be a collaborative effort of Business and IT. It needs the support of Business Leadership without which these efforts will never be successful. Success rates are higher when these drives are conducted by a joint team with representation from Business and IT and headed by a business leader