ERP Lifecycle
Concepts
Ronald E. Giachetti, Ph.D. Duane P. Truex, Ph.D.
Associate Professor Associate Professor
Industrial and Systems Engineering Computer Information Systems
Florida International University Georgia State University
"All you need is ignorance and
confidence and the success is sure."
(Mark Twain)
Agenda
Review ERP implementation project cycle including
Initiation
Project planning
Process analysis and design
Realization
Transition approaches
Operations from go live to support
Discuss ASAP as an example ERP method
May 18, 2015
Generic view of an ERP implementation
Essentially two major components
development and deployment
Development
Process selection/modeling
Coding/configuring
Data migration
Infrastructure
Deployment
Organizational change
Education
Go Live
May 18, 2015
ERP Implementation Phases
1. Initiation
6. Operations 2. Planning
3. Analysis &
5. Transition
Process design
4. Realization
May 18, 2015
Phase 1: Initiation
The beginning of the project
A project will begin when the project sponsor has
obtained the funding
Implies that top management of the firm feels that it
is important enough to invest big money
Pull in key project resources, i.e., the project
manager
Phase 2: Project planning
details
1. Set up project administration
2. Staff project
3. Set goals and objectives
4. Acquire project resources
5. Define metrics
6. Documentation standards
Phase 3: Process design
Elucidate very detailed information on
relevant processes
Determine specific process details
Redefine/clarify project scope
Learn what the technology (ERP Modules)
offers as a solution
Choose whether to redesign processes or
customize technology
At the same time, ready the technology
infrastructure to support the system
Installation steps
Size the system
Decide on installation type
Check on installation requirements
Install and configure hardware, network and base
software
Design file layout
Install central instance
Define database
Build and load database
Phase 4: Realization
Modifying plain vanilla enterprise
system to support organization
Industry specific settings
Unique characteristics of particular industry or
market segment
Company specific settings
Unique characteristics of company
Some geography specific settings are
usually allowed
Building interfaces to legacy
Programs that allow enterprise system to exchange
data with legacy systems
Inbound and outbound
Almost always custom-built
this is where the developers would step in; e.g., in
SAP R/3 they would do this in ABAP
Creation of authorizations
Roles
Executive Board
l Manager
Managerial Accounting Financial Accounting
Management
Executive Officer Managerial Accounting Financial Accounting
Strategic Planner Manager Manager
Managerial Accounting Financial Accountant
l Purchasing
Specialist
Managerial Accountant
Project Accountant
Tax Accountant
Joint Venture Accountant
Marketing
Procureme
Agent Service
nt
Marketing Executive Sales Executive Service Executive
Product/Brand Manager (Key) Account Manager Field Service
Marketing Research & Sales Representative Representative
Analysis Manager Sales Administrator Service Center Technician
l Employee
Resource Management Procurement Maintenance & Facilities
Management
Resource Manager Procurement Executive Maintenance & Facilities
Strategic Buyer Executive
Purchasing Agent Maintenance Manager
Maintenance Clerk
Maintenance Engineer
Real Estate Administrator
Manager
Purchasing Agent
Employee
Business Processs
Data migration/conversion
Need to transfer historical or legacy data to new
system
Requires custom programs
Significant cost and time could go into cleaning the
data
Similar to interfaces development work
Usually one-time uploads
Phase 5:Transition
approaches
Direct Cutover Old New
Parallel Transition Old
New
Phased Transition Old New
Pilot Transition Old
New
System testing
Occurs throughout phases 3, 4 and 5
Process personnel responsible for testing
Unit or function testing
Testing individual and composite processes
Includes data conversion programs, interfaces, and
authorizations
Occurs throughout realization phase
Integration testing, does it all work
Final step before go live
Stress testing
User acceptance testing
Training
Occurs throughout the project
Phase 1 and 2: project team education on the use
and implementation of the chosen solution
Phase 3-6: end user education on how to use the
system
Organizational change
Change Management is the Buzz word
for how to help the organization to accept
the new system
Intangible and fuzzy, yet highly important
in order to smooth the transition to the
new system
Often overlooked or the first place to cut
budget
More psychological than technical in nature
May 18, 2015
Phase 6: Operations
Quality assurance checks and evaluations
Optimization and refinement of the
production environment
Follow-up training and assessment of end-
user needs
Refinement of systems administration
procedures
Project review
What are the lessons learned?
ERP System Builds
Usually several builds maintained
1. Development System: all new functionality is developed and tested
here. Used by customization experts.
2. Test System: To test modules in isolation.
3. Integration System: Also called test system or simulation system,
but test in the integrated environment. Actual business data to test
functionality under realistic conditions. Business experts involved in
test and analysis.
4. Production System: The ERP system that is in actual use. All
functionality should have undergone intensive testing.
5. Reporting System: A copy of the production ERP delayed by a day
to enhance performance by doing reports.
6. Training System: A copy with realistic data for training. Data is not
deleted for continuity of training.
ASAP Implementation
Methodology
EXAMPLE of a company specific method
Continuous
Project Change
Preparation Final
Preparation
Go Live &
Business
Realization Support
Blueprint
SAP Proprietary Methodology
Accelerated SAP (ASAP)
An approach resulting in a quick, cost effective
implementation of R/3
Minimizes the length of time between installation and production
start up
Maximizes the utilization of SAP and customer resources
Incorporates a process oriented approach to training
Involves the user community
Results in a repeatable model that can be used with other
implementations of R/3
ASAP accelerators (tools)
R/3 Business Engineer (implementation tool)
Templates, examples, and checklists
Project Plan in MS Project
Templates for steering committee, etc.
A University SAP Implementation
Timeline
2003 2004 2005
Wave
S O N D J F M A M J J A S O N D J F M A M J J A S O N D
Project Prep.
Blueprint
Core Financial Realization Final
Prep.
Management Go Live
(R/3 Enterprise) Core Financial Sustain
Blueprint
Blueprint Realiz-
Final
Budget ation
Prep.
Project
Planning Strategies & Go Live
(SEM-BPS) Standards Sustain
Blueprint Realiz-
Financial ation Final
Prep.
Reporting Go Live
(BW) Sustain
Go Live
Blueprint / Realization
Portal Sustain
Project Preparation
Project Business Final Go Live Sustain
Evaluation Realization
Preparation Blueprint Preparation & Support
3 months
Purpose Key Activities
! Provide detailed planning for ! Finalize team structure
the project
! Establish Project Plan
! Identify high-level scope
! Engage business leaders &
! Define high-level strategies client stakeholders
! Define overall project ! Establish project mgmt
schedule & implementation procedures & standards
sequence
! Plan technical requirements
! Mobilize project team
! Hold project team training
Business Blueprint
Project Business Final Go Live Sustain
Evaluation Realization
Preparation Blueprint Preparation & Support
6 months
Purpose Key Activities
! Create the Business ! Identify process & functional
Blueprint document which gaps via Business Blueprint
serves as the design Workshops
specification for the new
system ! Define & document client
process changes
! Identify org. impacts
! Develop system environment
! Hold project team training
Realization
Project Business Final Go Live Sustain
Evaluation Realization
Preparation Blueprint Preparation & Support
6 months
Purpose Key Activities
! Implement business & ! Configure the ERP system
process requirements based
on Business Blueprint ! Develop reports, interfaces,
design conversions & enhancements
! Develop training materials
and end user documentation
! Conduct unit, integration &
user acceptance testing
! Establish authorization
concepts
Final Preparation
Project Business Final Go Live Sustain
Evaluation Realization
Preparation Blueprint Preparation & Support
1 month
Purpose Key Activities
! Complete preparations for ! Complete system testing
go live of the new SAP
! Hold end user training
system
! Complete system mgmt & cut
over planning
! Complete data conversion
! Establish system support
infrastructure
! Develop Help Desk
Go Live & Support
Project Business Final Go Live Sustain
Evaluation Realization
Preparation Blueprint Preparation & Support
1 month
Purpose Key Activities
! Move from pre-production ! Implement help desk &
environment to live, stable support infrastructure for end
production operation users
Implementation Deliverables
1 2 3 4 5
Business Process
Master List
Enhancements .
Authorizations System
Project
Reports Performance
Plan Interfaces
Processes
Scope Baseline Procedures Reports Test Plan
Org. structure
Scope Test Cases Interfaces Train.Mat.
Conversion Go Live
Plan
Business
Blueprint
Example of Project
Duration
PHASE Pct
1 Project Preparation 12%
2 Business Blueprint 15%
3 Realization 46%
Baseline 12%
Final Configuration 13%
Integration Test 21%
4 Final Preparation 19%
5 Go Live & Support 8%
Total 100%
Source: SAP (2002)
Example: University ERP
Project Phases
Team Training Phase
Configuration Phase (also called Structure Phase)
Knowledge transfer
Consultants configure
Consultants guide configuration
Team Leaders configure
Identify gaps
Construction Phase
Write specifications and develop from specifications
Data conversion
Interfaces
Modifications / Customizations Close gaps
Pre-Production Hardware
Example: University ERP
Project Phases (contd)
Transition Phase
Stress testing
Certification by State
Campus-wide training
Additional functionality
Deployment and Stabilization Phase
Go Live
Security
Performance support
PeopleSoft Implementation
Project
Example for a university HR module
implementation
2005 2006
1Q 2Q 3Q 4Q
Planning
Structure
Construct
Executive Sessions Transition
Partner Selections
Project Charter Business Needs
Deploy
Project Plan Design Sessions
Mapping Build / Develop
Conversion
System Test
Training
Rollout Strategy
Support Strategy
Summary
Discussed ERP life-cycle phases
ASAP methodology as example
University implementation as example
