Tips for a Successful Development of Enterprise Software

For a variety of reasons, businesses choose new Enterprise Software solutions. As a company grows, it may require a more robust system with more features and the flexibility to handle multi-site, multi-country operations. Legacy systems may be thought of as outdated and deficient in current capability. A corporate acquisition may necessitate system harmonization throughout a group, as well as a new group-wide strategy, necessitating the purchase of a new system. Once the choice to proceed has been taken, the selection process should focus on finding a product that offers simple functionality, effective business processes, management approval, user acceptability, and a positive return on investment for shareholders/stakeholders. In today's difficult economic climate, investing in a new system can help a company stay ahead of the competition, and while the implementation process may be time and resource-intensive, the long-term productivity and efficiency gains for the company can be significant.

Choosing a package is never without danger

It might be challenging and time-consuming to choose a new Enterprise Software solution. Despite recent vendor consolidation, organizations frequently choose a solution that does not totally satisfy their goals due to the huge number of Enterprise Software packages available. This could lead to a more expensive and time-consuming installation, as well as additional post-implementation costs. Nearly 90% of Enterprise Software installations are expected to be over budget and on schedule, owing to poor planning and underestimating the time and resources required for specific activities such as data migration. Project milestones might be unduly ambitious, designed to meet the needs of senior management, who will have lofty but not necessarily realistic expectations.

To avoid having to explain later why deadlines were not met and the system was not instantly able to produce the projected advantages, it pays to be cautious and realistic with these goals throughout the design process. Software development projects have a high risk of failure, but once they've started, it's best to let them run their course regardless of any issues that arise. It is usual for top management to postpone decision-making or implementation throughout the selection process, as it will become clear how much time will be necessary and how much the project would cost. Even if a compelling business case has been produced, senior personnel may be hesitant to proceed. During the decision-making process, a cost-benefit analysis can be performed to determine the savings to be gained from the new system, and the longer a development is delayed, the greater the loss to the business in terms of the savings that would be generated by employing the new system.

The organization can ensure that they pick the right option for long-term business and user value and that the new system is installed smoothly, on schedule, and within budget, with the right team in place and the right development plan. Selecting the appropriate software is the first stage in a lengthy process that will help avoid implementation issues, unexpected costs, and teething problems once the system is up and running, resulting in high levels of user satisfaction.

Tips to Successful Development of Enterprise Software

The 10-step method outlined below highlights the steps necessary to properly select a new system, and if followed, will ensure that the organization selects the Enterprise Software package required to fulfill their specific business needs.

1. The selection committee

Any significant Enterprise Software change project requires first-rate project management, as well as the participation of experienced, adequately qualified change consultants with the right balance of technical and soft skills, as well as the ability to engage effectively with users and the business. Once the business case has been built and the decision to replace the system has been made, a team should be formed to manage the project. Gathering user requirements, identifying suitable vendors, negotiating with vendors, visiting product demonstrations, and getting customer references should all be familiar to the selection team. The team should comprise a powerful sponsor from the organization's executive management team, who should ideally report directly to the CEO and be backed by fellow Senior Directors and other top managers in the relevant business areas. The Project Manager should coordinate the company's internal needs assessment, assemble a team of employees to help with the selection process, communicate with software vendors, and oversee the review process.

Changing Enterprise Software is more of a business decision than a technical one. The choice was made The Finance Systems Manager or a member of the Finance team is generally the Project Manager, but some organizations hire externally for this position to ensure that the selection process is fair. To provide particular product guidance, a consultant with a broad range of systems and selection knowledge may be hired. Even if the selection process is managed by a third party, an in-house Project Manager will be necessary to monitor progress and ensure that the needs of all segments of the business are met during the selection process. Many organizations prefer to retain selection in-house and control the process themselves, despite the fact that this strategy is less disruptive in terms of internal time and resources. It's crucial to make sure the outside party is entirely unbiased and has no ties to the software vendors, and it's also a good idea to ask for recommendations. Individuals from all functional areas of the business affected by the proposed software change should be included on the selection team. They should be enthusiastic about the process and have a firm grasp of the requirements of their particular functional area.

This personnel should be advocates for the new system, have positive relationships with departmental colleagues, and be able to effectively gather information to aid the process, as well as pass on knowledge and keep colleagues informed about the selection process. Employee input is crucial in any significant system change project because employees who will use the new system on a daily basis will be able to identify wasteful or unproductive present processes and recommend capabilities that would help their day-to-day working lives. It's critical to have user buy-in for the transition process and make sure they're comfortable with the new system. People are naturally wary of change and may reject it if the process is not handled properly. Ensuring user involvement in the process from the beginning means they will be more likely to be supportive and helpful throughout the process, will want to participate in the change process, and will be positive about the new system once it is operational. It should be remembered, however, that users involved in the selection and subsequent implementation process will have a reduced "day job" workload during this time, and additional resources may be required to cover some day-to-day activities. Otherwise, multiple demands may have a negative impact on the change program, resulting in negative feelings that could jeopardize the project.

2. Gathering requirements and analyzing needs

It's necessary to specify early on what the business hopes to accomplish by implementing a new system since critical success factors will not only help determine business requirements but also keep the project on track and focused on the most important business goals. If a company does not know what it wants to achieve in terms of cost savings, time savings, faster procedures, increased functionality, and improved reporting, it is unlikely to choose the best solution. It might be difficult to identify all of the features and functions that a new system will need, so it's usually a good idea to assess present system functionality, see what's being used and what isn't, and talk to users about what they enjoy and where improvements can be made. It's also crucial to consider the organization's long-term goals to ensure that the new system meets these requirements.

It is feasible to receive a list of significant features given by software providers; but, at this point, it is more vital to concentrate on the business process than to be sidetracked by features that may or may not be useful to the business. The areas of functionality that require an overhaul and further examination are often those where users spend the most time or have the most trouble searching for or adjusting data. Vendors respond to requirements in the same way and maybe compared 'like-for-like' without the need for additional information requests, thus the company must ensure that these criteria are completely clear and not subject to misinterpretation. It's also crucial to figure out which success elements are truly necessary for the project and which are simply 'good to have' if budget and functionality permit and these variables should be prioritized. The capacity of the software to work on present hardware (if the business is unable to upgrade it) should be looked at first, as these considerations can automatically reject some vendors. It's also crucial to distinguish between standard or fundamental capabilities available in all software packages and business-specific requirements, as this will distinguish one vendor from another.

Rather than merely providing new software to mimic past procedures, introducing new software should provide the opportunity to revamp and improve business processes. Rather than merely implementing a new system that runs legacy operations, the company should look to enhance all relevant areas so that the new system may benefit from simpler, more efficient working habits. Finally, the software used should provide good value for money and a positive return on investment so that the change has a positive long-term impact on the company's bottom line and is not so costly that it causes substantial short-term concerns.

3. A long list of software items that could be developed

There are several methods for obtaining the initial long list of potential vendors, and most finance systems professionals are familiar with established software providers and have presumably worked with several systems themselves. However, regardless of how experienced the Project Manager is, it is critical to do a thorough market analysis prior to making a decision to ensure that all options are evaluated and none are ruled out. The selection team may be pleasantly surprised by the service and functionality provided by smaller or lesser-known vendors, and should not immediately choose the more well-known names.

It's also worth noting that software resellers may offer their own in-house created functionality and workarounds, as well as more competitive pricing and possibly a more personal approach to account management and support. Internet searches, industry journals, colleagues, consultants, other industry connections, conferences, and seminars are all good places to look for vendors and resellers. Remember that people are important at this point and throughout the process, and communication should be as open as possible in order to get information from as many sources as possible.

4. Making requests for proposals to potential providers (RFP)

After a long list of resellers and suppliers has been discovered, and system needs have been created and prioritized, the requirements should be properly communicated to the vendors so that they may determine whether their software meets the criteria. Each potential vendor should be sent a Request for Proposal (RFP) requesting them to respond if their software can match the business's needs. Vendors should be questioned on the identified important success aspects, such as pricing, functionality, customizability, technology, implementation, support, and licensing.

To achieve a consistent response, make sure your inquiries are precise and straightforward. Wherever possible, providers should answer to each demand with a number indicating its availability, which can be used to assign a score to each vendor based on the 'fit' of their software to the business, but this will not always be practicable. It may also be beneficial at this stage to send an RFP to the company's current software vendor for comparison. It should not be overlooked that by adding some additional modules, functionality, or an upgrade, the current software product may be the best fit for the company, avoiding an expensive and time-consuming implementation. If the long list is too extensive, it may be more practical to send out a shorter list of critical questions to bidders, commonly referred to as a Request for Information (RFI), containing only vital features and major needs, to minimize numbers before sending out full RFPs.

5. Preliminary assessment and shortlisting

The responses to the RFPs can be used to assess suppliers based on the applicability of their goods and how well they match the business criteria, resulting in a list of no more than four possible vendors that can be evaluated further. RFPs should be evaluated quantitatively using a grading system that is weighted toward the most important business criteria, and scoring algorithms can be utilized to do so. To ensure that the evaluation is objective and free of bias, the score and weighting system, as well as any criteria utilized in the initial selection, should be pre-determined during the requirements collection process. Some systems may be promptly discarded due to a lack of basic features such as key functionality or the capacity of a system to interface with legacy systems or databases; other evaluation methods may be more complex.

6. Seeing software demonstrations and making phone calls to references

A smart place to start the selecting process is to invite roughly 4 or 5 vendors to perform an initial pre-sales demonstration. Vendors will want to spend as much time as possible with prospective clients at this stage in order to build a relationship, but it is probably best to limit these initial sales demonstrations to no more than 2 hours and ensure that vendors focus on the most important business issues rather than simply demonstrating the features of the product they want to sell. It's a good idea to keep the focus on the most important business requirements and unique customizations or functionality. It may save time to look at early demonstrations on the internet rather than visiting the vendor or inviting the vendor on-site, but the demonstrations may not be as tailored to specific business needs, and there may be fewer opportunities to ask questions.

Although watching software demonstrations is essential to the process, there is more to be learned from organizations that have already implemented the system than from sales demonstrations by software vendors attempting to obtain buy-in. Vendors should be asked for appropriate reference connections so that the selection team may talk about the process they went through and the challenges they ran into during the implementation process, as well as provide feedback on system performance after go-live. When dealing with references, preparation is vital, and a list of critical questions should be prepared, albeit keeping in mind that these organizations are vendor "success stories" that can be anticipated to respond positively. It's critical to ask tough questions regarding any difficulties they've had, any troubles they've had with the vendor, and any unresolved system concerns. Similar companies that use the software being examined should also be contacted, and it's good getting informal "off the record" references as these will not have been chosen by the seller. It's also crucial to get references from companies in the same or similar industries as the company because they'll have similar business processes, numbers of system users, and transaction volumes.

7. The total cost of ownership of the system

Before making a final decision, it's critical to thoroughly comprehend the system's total cost of ownership. The vendor or reseller can provide license fees, implementation, and support costs, but keep in mind that there may be less expensive options for implementation, training, and support, such as using independent consultants, new in-house staff who are already familiar with the proposed system, or the existing in-house team. Other factors to consider when estimating total cost include man-hours, networking, hardware costs, and communications, all of which should be factored into the budget. Sometimes, the hardware supporting the old system will need to be replaced or updated; the amount to which this will be necessary should be explored and factored into the cost, as it can be a considerable investment that is frequently overlooked. All direct and indirect expenses must be thoroughly studied; being startled halfway through an implementation project is bad practice, and software implementation projects are renowned for surpassing initial estimates. Internal and external costs should be considered, including the time spent by internal staff on the project, which is often overlooked because it diverts them from their regular responsibilities, but additional resources may be required to maintain basic business functions during busy project periods.

It's also crucial to consider the costs of common product improvements after they've been implemented. Most suppliers release regular service packs and bug patches to make modest functional enhancements at no additional expense, but if the organization may expect regular updates in the long run, this could result in additional licenses, time, and resources. Companies may opt not to accept all available upgrades right away, but they must guarantee that they are not penalized in terms of functionality or support. Future operating expenses, as well as immediate installation and license costs, must be carefully examined, as systems that are initially inexpensive to install may require greater operating costs in the long run. If headcount is predicted to grow, further license charges may be required, and pricing structures for different concurrent user numbers can fluctuate dramatically.

8. Prototyping, testing, and visiting reference locations are all steps in the process

It's critical to verify that any essential customizing works properly, and establishing a prototype or boardroom pilot for testing are a good approach to ensure that they do, as well as to determine whether all customization is necessary. Workarounds may be sufficient in some cases, and the less customized a system is, the easier it is to solve issues and train employees. It's also easier to upgrade a conventional vanilla system because the modification isn't required. Vendors will need to be compensated for their prototype efforts, but it is a worthwhile investment because many firms have realized at this stage that the software that was previously at the top of the selection list does not satisfy their criteria or does not withstand extensive testing.

This is also the time to see more in-depth demonstrations from a smaller number of vendors, possibly inviting them on-site for up to a day to go over all parts of the system specific to your needs. This also allows the company to spend more time with the vendor and determine whether their organization's approach and procedures are compatible with the company's. When it comes to deploying a new software system, it's not just about buying a new system; it's also about forming a partnership with the software vendor, and having a solid working relationship is critical to success. In addition to acquiring references, it is critical to visit at least one organization that is currently utilizing the systems under consideration for selection, as this provides insight into system operation in a real-world setting. Speaking with the finance systems team about their experiences with the vendor throughout implementation and after go-live, as well as the users who use the system on a daily basis, many of whom will have undergone intensive training and had to adjust to new working methods. Although reference sites are likely to be the vendor's most satisfied customers, they should provide an opportunity to discuss the software, its benefits, and shortcomings openly.

9. Picking a product

Because some suppliers were simply unable to satisfy specific business demands or back up their sales demonstrations with live sites and client references, the choice of the vendor should have become evident during the selection process. If a single vendor has not emerged as the obvious choice at this point, there are many factors to consider in making the final decision, including the vendor's reputation and track record, functionality, software customization to meet unique requirements, the total cost of implementation, and ownership, ease and timescales of implementation, ability to keep up with technological changes, and support services available. If other variables such as functionality and pricing are nearly comparable, the final decision may come down to the relationship developed with the vendor during the selection process. Although the way the vendor's sales team behaves and their willingness and openness to providing client references and information are likely to be a good indication of their service levels moving forward, not every vendor is equally attentive during the sales process. In the long run, it will not be the sales team that manages the account and provides support. At this time, it's also crucial to analyze all variables and remember not to merely go for the safe option; the saying "no one has ever been fired for adopting SAP" is commonly heard, despite the fact that these projects routinely over-run and go over budget due to their complexity.

Choosing the largest or most well-known vendor over one that offers a better business fit and service standards at a cheaper cost may not be the wisest selection. To eliminate prejudice from employees who may have a preference for a given system owing to corporate reputation, previous experience, or their own desire to work with a particular product, it is critical that the team participates in the final selection. All members of the team, especially those who will be implementing and utilizing the system after go-live, should be included in the final decision. If the organization has major growth ambitions, these should be included in the selection so that the chosen product is scalable, able to accommodate this growth, and will not result in any unanticipated additional costs. If the company is looking to expand, it must first establish how readily new companies can be integrated utilizing the new product. The solution's flexibility is also vital because if the organization changes, the new system should be able to adapt, otherwise the system may need to be changed again to accommodate new working patterns.

10. Evaluation, end-user feedback, and potential changes

After the new system has been chosen and fully deployed, it is recommended that the selection and implementation process be reviewed because there is always an opportunity for improvement and it is critical to learn from past failures. Following a software implementation, things rarely go exactly as anticipated, and teething issues are to be expected. It is critical to gather user feedback on system performance, as it is likely that some improvements will be required. If the most appropriate product and software vendor has been chosen, the organization should receive competent support to handle any initial teething problems, and the anticipated business benefits should be realized quickly.

Summary

The organization will be well-positioned to select a suitable Enterprise Software solution to fulfill their present and future demands if they follow the 10-step method outlined above. After you've chosen the correct system, the next step is to successfully implement it, which presents a new set of obstacles.