Decision Flowchart For ERP Project Prioritization Essay Sample
Type of paper: Essay
Topic: System, Company, Project, Innovation, Implementation, Entrepreneurship, Enterprise, Management
Information technology management
The flow chart above shows that the decision to either upgrade or replace the existing ERP system relies on the CEO directive or not. If the directive is from the CEO, then the system can only be upgraded given that this is only a one man’s idea which is not meant to do way with every part of the current system. If the directive is not from the CEO, then the system can be replaced if it is a requirement. This means that replacement process is supported by several individuals/staff who finds it beneficial or profitable to the enterprise. The CEO in this case may be part f those supporting the replacement although the directive does not come from him/her, but from majority opinions.
A project in this case is given the highest priority of completion if the directive comes from the CEO. In a case, where the directive is not from the CEO, then the project completion is given the priority if it sustains business operations or it meets the compliance requirements. A project that is considered a requirement and meets compliance requirement is taken to the completion queue where funds are allocated to it for completion. A project can also be considered as a requirement but fails to meet compliance requirement. Such project is forwarded to the IT project prioritization committee (ITPPC) for re-evaluation. A project that sustains business operations is straightly taken to the completion queue where funds are allocated to it for completion. Any project that that not fall under the CEO directive and at the same time not a requirement is given the lowest priority and is re-evaluated by the ITPPC in terms of its urgency, risk reduction, return on investment(ROI) and in terms of whether it concurs with the plans of the enterprise.
Scenario evaluation of existing ERP system using the decision flowchart
Since the current ERP system is used to support all major aspects of the company ranging from finance, human resource, manufacturing and customer relationship management, it implies that that the project is a requirement which falls under replacement and not upgrading. This is because the opinion of the CEO is not mentioned in the scenario and thus the decision is out of his/her directive. The fact that ERP system supports all aspects of the enterprise mentioned above means that it sustains business operations. It is therefore a requirement that should be directly taken to the completion queue for fund allocation.
Internal or external factors affecting the project
The external and internal environmental changes like requirements instability and diversity are all sources of emerging risks. There are also other internal factors such as the existing enterprise IT system like legislative requirements. There are also technical constraints dictated by other external entities. In terms of evaluation, these entire risk factors together make it difficult to estimate the performance of the project as far as software risk-based theory is concerned (Liu et al., 2011, McLeod & MacDonnell, 2011).
Evaluation of the potential impact
The requirements and instability and diversity, for example, is a risk which may slow down decision making on whether to take the project to the completion queue or not. This is because any project development and implementation depends on the available requirements which are gathered from all stakeholders. In case the collected requirements from various staff members varies by a large margin, then the implementation process becomes difficult given that a good number of stakeholders will appear to oppose the idea with others in support of it. Opposition is thus a major risk factor since any attempt to implement the system by overlooking those opposed to it may finally result to failure and great loss once the system is put in place (McLeod & MacDonnell, 2011).
Factors like legislation should also be considered given that in-house or tailor made software development for an enterprise or company is governed by software laws and ethics. The technical constraints or limitations is also a major factor that have to be considered since either the upgrade or complete replacement of the existing ERP software relies on the available technical knowhow within the enterprise staff as well the external limitations in technology in relation to the scope of system implementation. The organization or enterprise itself may end running at a loss in case the system happens to fail after implementation due to various risks mentioned herein. This also means that the absence or the lower the risks, the higher the chance of successful implementation which also translates to high benefits or profits to the profits.
Strategy for the effective mitigation of risks
The most effective ways of risk alleviation include user involvement in all stages of enterprise resource planning software replacement, consideration of both opposing and supporting sides of the replacement idea and staff training. In addition, the approved methodology should be used during the process of ERP software implementation.
Justification of the strategy
The consideration of both opposing and supporting sides of software replacement in this case will be helpful in reducing the risks of disagreements on requirements needed since it will ensure that all stakeholders brainstorm on important issues before coming to a compromise requirement solution. The user involvement in the whole process is a way of ensuring that every user and other stakeholders are well conversant of the proposed new ERP software in relation to the existing one that they are using.
This will in addition help them appreciate the befits of supporting the entire software replacement even if they are better skilled in using the old and existing system. The in-house or off-house staff training will play a role of ensuring that all staff is aware of the new technology that needs to be used in replacing the current one including technical knowhow about it. In addition, staff training makes the concerned staff more informed to an extent of championing the change to the new system themselves instead of opposing it. The use of approved technology will be helpful in reducing risks associated with ERP software implementation in addition to enabling ERP solution to be put in to operation as quickly as possible. The use of correct implementation methodology also ensures that ERP implementation completely addresses the goals and the objectives of the business enterprise (Lutovac & Manojlov, 2012).
Plan for flexible change management during replacement
The overall plan in this case is aimed at reducing problems and other issues that may come after implementing the ERP system. The plans include the establishment of project management activities for the purpose of ensuring that project implementation goes in accordance with the schedule. The enterprise should also plan the cutover activities in the final preparation phase. These are the activities required for changing from the old system to a new system. The change should include matching the two systems in terms of interfaces which is of course critical for users given that there is no identical system across the world (Lutovac & Manojlov, 2012).
For optimal system value and desired success, the plan includes cautious selection of the methodology on which the enterprise resource planning system is based. This is because an inappropriate application in addition to implementation of the ERP can hinder the enterprise performance. The fast implementation and short term on investment in the ERP can be profitable in case the company or enterprise project managers as well as the external consultants companies stick to plans and budgets. The enterprise managers should also plan to do the correct thing and do away with the traps (Lutovac & Manojlov, 2012).
Rather than maintaining the previous business processes after implementation, the plans also include employing standardized software having built-in- business procedures as the basis for the changes in the enterprise in addition to the reduction in the number of various business procedures. Further plans are such that the fresh business processes will not be constrained by the enterprise resource planning system for the purpose of permitting easy response to market environment and constant challenges from different competitors (Lutovac & Manojlov, 2012).
The fresh ERP system solution is also planned to be simplified for reasons of increasing accessibility and easy of usage depending on the agile methodology and even cloud computing which is a better option for the web system such as this. The security of personal data is also planned to be given higher priority during the replacement and integration stage of the ERP system, as well as data associated with customers and internal procedures which cannot be lost. The top management is also planned to fully participate as a control measure in every stage of an implementation and offer suitable conditions for the ERP implementation. There will also be balancing of consulting companies and the high level management of the enterprise with expectation of optimizing the ERP implementation (Yilmaz & Ozcan, 2011, Lutovac &Manojlov, 2012, Lutovac & Manojlov, 2012).
The schedule of activities is planned to take place according to the schedule shown bellow. The project is planned to take approximately four months and three weeks as per every activity time allocation shown bellow.
Activity schedule description
Investigation of the current ERP system to take two weeks as from March 2015
Data collection is to take place for a period of approximately two weeks immediately after the investigation process.
Analysis of the collected data from the enterprise is planned to start immediately after data collection process. This will take a period of another two weeks.
The next phase is the design which is planned to take a period of one month. The design process is scheduled to start one week after the analysis stage.
The coding implementation process is also planned according to the schedule to take place one week after design phase. This is approximated to take a period of three weeks.
The next stage is testing which is scheduled to take place for a period of another two weeks. All users and developers will take part in the testing phase to ensure that the expected users are contented with the functioning of the system as far as user acceptance testing is concerned.
The change over process is to take place immediately once the testing process is successful. The parallel running change over will be used to allow the two systems to run simultaneously. This will allow the stakeholders to easily compare the quality of the two systems in terms of functioning and performance and to pin point out any weakness that may be present in the new system before the old system is done away with. This change over process will take place for another two weeks before removing the old system from operation.
Gantt chart that displays the timeline of the ERP project. The following diagram illustrates a Gantt chart having time lines of activities that are to take place right from the initial phase up to implementation. The phase names have been used to stand for all activities that are to take place in every phase of development phases. The time in weeks are labeled as wk. This starts from wk1 to wk19 to symbolize first week up to the nineteenth week. The ERP complete implementation is thus to end in late July 2015 as far as the activity schedule is concerned.
Liu, J. Y. C., Chen, H. G., Chen, C. C., &Sheu, T. S. (2011). Relationships among interpersonal conflict, requirements uncertainty, and software project performance. International Journal of Project Management, 29(5), 547-556
McLeod, L., &MacDonell, S. G. (2011). Factors that affect software systems development project outcomes: A survey of research. ACM Computing Surveys (CSUR), 43(4), 24.
Lutovac, M., &Manojlov, D. (2012).The Successful Methodology for Enterprise Resource Planning (ERP) Implementation. Journal of Modern Accounting and Auditing, 8(12), 1838-1847.
Yilmaz, Y., & Ozcan, G. (2011). Implementing ERP systems with accelerated ERP more efficient and quickly⎯A best practice. Journal of Systems Integration, 2(3), 28-37.
Lutovac, M., & Manojlov, D. (2012). Impact of ERP consulting companies in surveillance of personal and business data in e-commerce. 19th International Conference on Technology, Culture,and Development, Tivat, Montenegro, August 28-30, 2012.