Optimize ERP Business Processes: Identify the best targets for process optimization and focus on configuration.

OPTIMIZE ERP BUSINESS PROCESSES Identify the best targets for process optimization and focus on configuration. JJ JUST SAY "NO" TO EVERYTHING ELSE. 0: THE PROBLEM FACING MANY IT LEADERS TODAY INFO-TECH'S KEY INSIGHT 53% OF 2 OUT OF EVERY 5 ORGANIZATIONS IMPLEMED A ONS ARE REPORT THAT THEY ONLY 12% OF ORGANIZATIONS IMPLEMENT AN ERP REPORT THAT THEY CHANGE BUSINESS PROCESSES TO MATCH THE OUT-OF-THE-BOX BUSINESS SYSTEM TO OPTIMIZE BUSINESS PROCESSES PROCESSES BUILT INTO THE ERP SYSTEM. ERP systems are hard to buy, hard to implement and hard to optimize 2 out of every 5 implementatione are deemed a failure and a failed implementation can cost you your ERP optimization is a form of process optimization. In today's uncertain economic times, where revenue is erratic and the future unpredictable, squeezing every last cent out of business processes is essential for success. 53% of organizations report that they implement an ERP system to imerove business processes, but pursue no formal business process management strategy. ERP is a stepping stone to help you get there, but unless you employ both ERP optimization and business process management, your organization will continue to lag behind the rest in terma of maximizing profit. Customizing your ERP system puahes you off the path to upgrade and increases the total cost of ownership. Following our end-user driven approach will increase process efficiency by configuring the ERP system. career. After the failed implementation is complete, organizations tend to close their eyes and hope the system optimizes itself. 47% OF ORGANIZATIONS REPORT THAT THE CHANGE THAT ERP CAUSES IS 'DIFFICULT TO MANAGE AVERAGE IаPRоvEMEнT оF PERFORMANCcE METRICS 15% 15% AND ONLY 1 IN 4 ORGANIZATIONS REPORT THAT THEY HAVE AN "INTENSE' FOCUS ON CHANGE HANAGEMENT DURING TUEIR A) DEFECT RATES: Improves the predictability of processes by helping organizations understand how they really function by 10%. ERP IMPLEMENTATIONS CONFIGURATION COSTS O AZATIO OF WHAT B) FREQUENCY OF SERVICE OR PRODUCT DELATSe Minimanze DOES IN TERMS OF IT LABOUR COST. of surprises that c delay produet tea delivery by 10 TOTAL ESTUSTOMAZATION LABOUR COSTS FOR Is 7 TIMES HIGHER THAN COSTS TO RECONFIGURE. c) CYCLE TIME Process evaluation can reduce the number of steps in processes by 15% Process optimization and ERP is still not enought Both of these intensive initiatives cause frictional change in the oeganization that can radically affect people's day-to-day lives. Managing a value enriching ERP system requires a focus on bo process optimization and change management. D) CUSTOMIZATION & FLEXIBILITY: Facilitates mixing and matching components to produce new products and services by 15% DISCOVERY WORKSHOPS Discovery workohope should be led by the IT department, but driven by end usera. Participants should include: $17,500 $2,500 000 ITT 3. IT REPRESENTATIVES 4. BUSINESS ANALYSTS 1) PROCESS OWNERS Process owners will be a key stakeholder to involve in the workshops. They will take an informal leadership role during the workshops and be in charge of maintaining the process post optimization. IT must lead this effort and therefore phould have a senior representative present during the optimization efforts. IT will ensure the recommendations are implemented. Further analysis may be required after the optimization efforts are commolete. The BA can complete other tasks during the workshop such as completing the process maps and documenting the day's activities 2. PROCESS END USERS End users hold the key of how to optimize the ERP system. They are the daily transaction users and therefore must be included in the effort. Ensure to take different representatives from the process to gain depth of perspective. BECOMING A PROCESS CENTRIC ONGANIZATION PREPARES YOU TO ADOPT BEST PRACTICE MANAGEMENT FRAMEWORKS SUCH AS COBITSO & TILO EMBRACING DEST PRACTICE FRAMEWORKS SUCH AS COBITSO & TILO WILL PROVICE THE FOUNDATION TO BECOME IsO CERTIFIED. COBIT ITIL ISO FOLLOW THE INFO-TECH PATH TO ERP PROCESS OPTIMIZATION De PROCESS Unlike ERP system implementatione, ERP optimization is not a 'once-a-career' activity. OUR EXPERTS AGREE, "ABOUT 10% OF BUSINESS PROCESSES OPTIMIZATION SOP REQUIRE CUSTOMIZATION. IT's IT must adopt ERP optimization as an internal task that is performed on a continual basis. IMPORTANT TO TRY AND STAY AWAY FROM ANY MORE THEN THAT" - CHRIS DEVAULT FROM PANORAMA CONSULTING Configuring the ERP system is a low cost, low effort activity that will generate continual improvements in ERP related business processes. USE THE BUSINESS PROCESS OPPORTUNITY ASSESSMENT TOOL TO PRIORITIZE WHAT BUSINESS PROCESSES SHOULD BE OPTIMIZED Onnortum The llusiness Process pporeanty Assessment tool ranks business Procises considening opportunity, sa Snd coet while also considering value and risk. BUSINESS ·Considering key process performance indicators will llow vou measure the improvement process. Use the business process prioritization plot to communicate to the IT steering committee and senior management .......... BUSINESS CREATE THE BUSINESS O USNESS PROCESS PLOT TO The Business Process Opportunity Assesement tool will provide recommendations optimize business processes. SIMPLIFY THE w to PRIORITIZATION BUSINESS O PROCESS 4 PROCESS By the end of this step, you will have a prioritized list of business processes and a recommended course of action to address the suboptimal business processes BUSINESS Priority/Satisfaction 60% OF THE PERFORMANCE ISSUES RESULT IN A LOSS CONDUCT DISCOVERY OF PRODUCTIVITY WORKSHOPS TO GAIN INSIGHTS FROM 83% OF ORGANIZATIONS END USERS HAVE ERP PERFORMANCE ISSUES THAT IMPACT END USERS FOLLOW THESE WORKSHOP ACTIVITIES Map business processes to identify shifting levels of control and provide end users visibility into how the process is executed. Use swimlane analyeis to examine business rules. The goal here is to empower the end user to make decisions and reduce the number of exceptions and approvals that must be handled by managers. IDENTIFY AND PROFILE ERP INTERFACES THAT ARE USED IN DEVELOP END USER STORYBOARD AND WIREFRAME ERP THE BUSINESS PROCESSES PERSONAS TO IDENTIFY INTERFACES TO DEVELOP IMPROVED AND DOCUMENT THE INTERFACES COMMON ELEMENTS OF ERP INTERFACES AND HANDCUFF IN THE ERP OPTIMIZATION THE INTERFACE USERS USER INTERFACE CONSULTANTS PROGRAM MANUAL LIKE AND DISLIKE BY PERFORMING HIGH MARGIN, LOW EFFORT ACTIVITIES VOURSELF. SUCCESE DOCUMENT THE BUSINESS PROCESS USING THE PROCESS EMPLOY DATA VALIDATION PRACTICES AND BASED DOCUMENTATION TECHNIQUES TO IMPROVE THE TIME TO INPUT DATA INTO THE ERP SYSTEM AND STREAMLINE END USERS' TASKS TEMPLATE TO HELP GUIDE END USERS THROUGH THE BUSINESS PROCESS *IDENTIFY REQUIRED FIELDS * APPLY MINIMUMS AND MAXIMUMS TO FIELDS DENTIFY DISCRETE VALUES & USE DROP DOWN MENUS IDENTIFY DEFAULT VALUES DEVELOP FIELD MASKS *MAP FIELD DEPENDENCES OF ALL CHANGE INITIATIVES THAT FAIL, 72% FAIL DUE TO PEOPLE ISUES. OF THAT 72%, 33% OF FAILED CHANGE IS DUE TO A LACK OF MANAGEMENT SUPPORT AND 39% BECAUSE OF GENERAL EMPLOYEE DEVELOP ANY ADDITIONAL ERP OPTIMIZATION PROJECT PROPOSALS RESISTANCE TO CHANGE. USE THE MCLEAN & co. CHANGE MANAGEMENT FRAMEWORK TO MANAGE THE CHANGE. ERP Optimization may require some more specialized projects. such as an user interface design project. Use the analysis performed in the Business Process Opportunity Assesement tool to populate the Info-Tech Project Request Template and the Info Tech Comprehensive Business Case Template. Develop a communications plan to reduce the ansiety to change. PREPARE FOR LAUNCH AND MONITORING OF Introduce the change using the discovery workshops as a first step. THE OPTIMIZED BUSINESS PROCESS Implement the optimized processes using training best practices. Encourage adoption by measuring the success of the ERP Optimization program. 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