Project budgets can be tricky to develop and manage, even when executing a relatively simple initiative with a limited scope. ERP implementation efforts—with their large budgets, long durations, and broad operational impacts—have the potential to encounter even more financial challenges.
To help protect your budget and ensure you have the right level of resources to move your ERP effort to a successful completion, take these common budget problems into account so you can more accurately forecast your funding needs.
Improperly scoped systems and/or overlooked customization requirements. ERP systems are expansive and powerful, but all those features can make it difficult to understand which capabilities you’ll have on tap once the implementation is complete. Unfortunately, it will add significant cost to your project budget if you discover mid-stream that you need support for custom software development to tailor the system to your needs or that additional modules or features are necessary to solve your use case. To avoid these issues, involve all stakeholder groups when scoping the new ERP solution and ensure everyone is clear on the capabilities they need for their respective areas.
Missed platform integration costs. Just as software customization can be an expensive add, failing to properly specify how system-to-system connections will be handled is another way to find yourself needing more funds than you originally forecasted. Many modern business systems have the connection capabilities to integrate in a straightforward manner with popular ERP platforms, but legacy systems often don’t. If your infrastructure includes legacy solutions—and most companies still have any number of these older platforms lurking in their technology stacks—be sure to get clarity from your implementation partners on how connections will be made and what additional expenses may be involved to support them.
Insufficient data security capabilities. Your existing data security program may be adequate for your needs today, but it’s important to know if everything can scale up to address the new components and connections that will eventually be part of your environment. If vendors or other external business partners will be transmitting information directly into your ERP system, are those connections properly configured and protected? Have you budgeted for an expert to assess your current credentialing program and ensure individual logins continue to provide the appropriate level of access to each system that will be involved in the ERP implementation? Wide-ranging system links can complicate the data security picture significantly, and resolving vulnerabilities post-installation is much more expensive than planning for them ahead of time. Include the right expertise from the beginning to ensure you aren’t surprised by data security concerns later.
Determine funding requirements for related infrastructure upgrades. Once you’ve identified the right system features, integration types, and data security measures, you’ll also need to consider where funding may be needed to boost capabilities across the rest of your infrastructure. Some enterprises may need to increase bandwidth capacity to accommodate increased network traffic to and from the ERP platform and its linked systems. Cloud or other services might be necessary to enable remote access to the new platform and to drive high-consumption tools such as data analytics, and robust backup support could be an important addition if your existing disaster recovery capabilities aren’t sufficient. On-premises installations may require physical upgrades such as increased cooling capacity or additional power supplies. Infrastructure changes are often costly and time consuming, and your budget problems will only grow if they need to be added after your ERP project is already underway. Carefully assess your infrastructure’s capabilities as part of the initial planning phase to catch any gaps that will need to be addressed.