ERP Selection for a Distribution & Services Company
Background – Custom ERP
ITDirections was engaged by a very large ($4B revenue and 7,000 team members) global health distribution and services company. The company was composed of three unique business units with 15 distribution centers. The Client had a custom legacy Enterprise Requirements System (ERP) with many complexities and medical regulatory requirements. The Client engaged ITDirections to select a new ERP system and plan their implementation effort to meet their growing needs.
The Challenge – Massive High-Risk Implementation
The Client recognized their ERP implementation would be a massive multi-year effort costing over $10M. Additionally, the project would result in a tremendous amount of change throughout the enterprise and the major re-design of legacy business processes would affect nearly everyone in the Company. An effort this critical absolutely had to be successful. They knew it would be cost-prohibitive and increase the risk to outsource the implementation effort to consultants due to the critical nature and amount of business change required. They needed an approach with a strong internal team guided by experienced consultants.
The Solution – A Do-It-Yourself Approach
ITDirections took a unique approach during their selection project by dedicating a full-time internal team on day one. We formed a dedicated internal cross-functional team of 20 individuals representing the various business units and locations. The team consisted of Business Analyst paired with a business representative for each major function. This team would select the solution and then lead the software implementation enterprise-wide. Typically, a team of this magnitude would not be full-time dedicated to the project until the implementation phase.
Throughout the process, ITDirections trained and guided the Client’s internal team. Concurrent with the selection, the team began to document, assess, and initiate the business process transformation effort. Typically training and process transformation work is not started until the implementation phase.
The Results –Implement with More Internal Resources and Fewer Consultants
Shortly after the implementation kickoff, the trained team was progressing at an incredible rate. Typically it would take three to six months to get an implementation team geared-up and fully productive. This team was immediately prepared with the skills and knowledge to be effective because of their intensive involvement during the selection. As a result, they were able to take on more of the effort commonly performed by external consultants. They were also able to avoid some of the rework often encountered due to a team’s inexperience during the initial implementation learning curve. According to their CEO, “The new system will significantly enhance their efficiency and ability to scale as the company grows.” (Quoted from an investor conference call)