Tuesday, May 17, 2011

Analytics for ERP Implementations

The implementation of an Enterprise Resource Planning (ERP) solution is a complicated endeavor.  It requires the coordination of cross-functional teams, huge IT commitments, and the definition or re engineering of business processes.  Needless to say, this is an undertaking that comes with a substantial price tag.  The right mix of business rules, meta data and analytics, however, can facilitate a successful result.
One of the difficulties encountered in ERP implementations is in defining the relationships between job responsibilities of individual users, and functionality within the ERP system.  This is a business management rather than technical exercise.  Most successful ERP implementations are able to clearly define the relationships that exist between individuals and their jobs (i.e. Mary the Accountant), the business roles they perform (i.e. payroll, accounts payable) and the ERP functionality they need to do their job (i.e. check register).
In an organization of reasonable size, these relationships will result in a vast network of complex associations that cross business function and organizational structure.  Many organizations will develop a “jobs” database, separate from the ERP system, to keep track of all these relationships, and that help define necessary training and security settings.
The existence of these jobs databases not only provide invaluable information about individual job needs, but they also offer a management oversight mechanism to monitor the progress of an ERP implementation.  Specifically, summary analytics provide the ability to understand progress to date, current needs, and potential risks to the implementation schedule.  These analytics are not meant to monitor the technology implementation, but rather the human resource readiness and controls that must be in place to successfully utilize the functionality that an ERP system will provide.

Once the implementation is complete and the system is being utlized, the relationships defined in the jobs database can be integrated with usage data to generate the next level of analytics.  In addition to monitoring usage patterns across a user base, the integrated datasets can also allow for identification of gaps with pre-defined job roles, capabilities and training that were not anticipated during the implementation.  These analytics can in effect "train" the system to constantly evolve the jobs relationships such that they are satisfying current business needs.
A sample of analytics that could be performed pre and post implementation include:
  - Review business role gaps necessary for specific jobs
  - Identify current and emerging security gaps
  - Identify current and emerging gaps in training
  - Monitor the progress of training
  - Monitor implementation progress to plan
Each ERP implementation will define its own analytics to support implementation oversight.  Starting with a well defined defined business rule framework and a mechanism to track progress, however, will provide an information system that supports and clarifies a complex business solution.