The 7 Key Phases of ERP Implementation

The 7 Key Phases of ERP Implementation post image

Implementing an Enterprise Resource Planning (ERP) system keeps your company data secure, centralised, and compliant.

This software solution can truly revolutionise how your business manages and conducts rudimentary business processes. However, poor implementation can cause serious strain on your finances, resources, and, most negatively, your employees.

The risks associated with poor implementation may put you off adopting new software altogether. To boost your confidence, we’ve created this business owners’ guide to the 7 key phases of ERP system implementation.

What is an ERP implementation?

Implementing ERP software goes beyond simply selecting a new software and introducing it to your company. It involves evaluating your business processes, choosing an ERP provider, setting a software budget, and also configuring, training, and migrating.

An ERP serves to connect all aspects of your business together. It’s a suite that employees from sales, marketing, human resources, and accounting can all use and collaborate on. ERP systems offer one central space for all departments to work together, instead of using separate platforms. It helps your whole company collaborate efficiently.

You can use it for:

·      Supply chain management

·      Risk management

·      Project management

·      Procurement

·      Accounting

Given its wide-ranging usability, the process of implementing a new ERP into your company should involve all of your employees.

A successful ERP implementation finishes with you utilising the new system to the max and your business being transformed for the better.


How long will an ERP implementation take?

Regardless of the size of your company, ERP implementation should take at least four months. As with all cases of software adoption, the exact length can vary. The size, steps, and software used affect how quickly your new ERP system will be fully integrated.

For some businesses, it will take 6 months, for others, it could take upwards of a year. So, don’t be surprised to find that your ERP project will take over 12 months. It’s important to accept this forecast rather than find shortcuts, which will undoubtedly cause the process to hit snags.

Just as the implementation process and your software requirements will be unique to your business, as will the timescale.

Three reasons why ERP implementations fail

To provide context to how we selected the seven key phases listed in this article, let’s first highlight the challenges of adopting an ERP system for businesses. The only way to overcome these challenges is to have a solid, 7-part implementation plan in place.


Adopting new software tends to be an expensive process. Not only can the upfront cost tip you over budget, but the onboarding, maintenance, and other ongoing costs can exhaust your funds in the long term. Even when finances look promising at the start of the implementation, businesses can often become overwhelmed by unexpected and ongoing maintenance costs.

Time scale

Businesses often fail to set an accurate time scale for their ERP implementation, as highlighted in this Panorama ERP Report from 2023. This study found that, of the businesses examined, only 49.7% finished implementing their ERP system on time. This means that over half of businesses found that ERP adoption takes longer than expected.

This inability for businesses to accurately predict time scales often causes them to overrun resources and finances. It also often leads to ERP implementation eating into time set aside for other projects.  

Project management

Each phase of the implementation process must be regarded as highly important. ERP implementations fail when focus drops off after the software has been bought and set up. An equal amount of attention needs to be given to configuring as does training, and so on.

The only way to achieve this is to set up an implementation team and appoint project managers to oversee each phase of the process. Strong communication and collaboration need to occur between each project manager as well as between managers and the team they are overseeing. Adoption only works when everyone gets involved – from the executives and top leaders to new employees.

Your 7-part ERP implementation plan

Now you’re aware of the common pitfalls to avoid, it’s time to get to grips with the implementation phases. You can adapt the following phases to better suit your business set-up.

Phase 1 – Assessing and planning

An ERP can make your business operate at its full potential, but only when you invest in a system that fits your business model and meets your requirements.

Phase 1 should be dedicated to a cross-departmental analysis of your current business limitations. You need to assess the current software systems used by each of your departments and identify areas that could be improved by a new ERP system.

To give you an idea of what you should be looking for, see if you can find specific issues regarding communication, reporting, inventory management, user experience, financial processes, and so on.

You should also look for areas of your business operations where automation or data integration could improve your overall workflow.

Once you’ve analysed your business, compile a list of goals and objectives for your new ERP system.

This deep analysis will give you a benchmark of what you need this new ERP system to resolve. It will also make discussing your needs with software providers a lot easier. 

Phase 2 – Set up an ERP project team

It would now be a good idea to set up an ERP project team. Ideally, this team should consist of both employees and key stakeholders who can work together to plan and oversee the entire project.

Involving a broad range of employees in this preliminary stage allows you to cohesively tackle ERP implementation. It gives each department a voice, keeps everyone in the loop with ERP adoption, and, by involving the whole company, helps you justify the need for a new ERP system.

To bolster your initial ERP analysis, you should task this team to highlight any additional inefficiencies with the current ERP solution.

Phase 3 – Selecting a vendor

Phase 3 is, undoubtedly, the most crucial component of ERP implementation. It involves taking all the research you and your ERP project team have conducted so far and measuring it against the offerings of ERP software providers.

Not only do you need to assess the features provided, but also the:

  • Cost
  • Functionality
  • Compatibility
  • & scalability of the software.

To narrow your shortlist of potential ERP providers, you’ll have to review available case studies and research the reputation and track record of each company. You’ll then have to arrange meetings with representatives and trial demos.

Clearly, this is a bulky process that demands your full attention.

Here at YourShortlist, we can guarantee the successful completion of this phase on your behalf. Not only are we ERP experts, but we’re also expert ERP buyers. We have a large bank of pre-vetted vendors we can filter down using your unique needs, requirements, and budget. We’ll then provide you with a shortlist from which you can select a vendor.

Phase 4 – Mapping your ERP adoption

Now that you’ve selected a vendor, you can start integrating it. At this stage, you should identify milestones and key dates in your integration progress.

Implementing new ERP involves reengineering your whole business processes, so strategic planning is required. You need to think about how best to migrate your data to the new system.

The adoption of the new system involves two key components: your data and your staff.

In terms of data migration, you need to carve time for:

  • Extracting data – If you’re investing in a new ERP to replace several other systems, you need to load and extract data from several sources, which can take a while. You may find that each system uses a different data formatting, which can further complicate the data extraction process.
  • Data cleansing and validating – Before implementing your company’s data into the new system, you need to check for accuracy and relevancy. You need to remove discrepancies and instances of duplicate information.
  • Standardising data and formatting – You need to ensure that your data is formatted consistently before inputting it into the new ERP system. If you fail to standardise your data, it can cause errors in your new system.

On top of readying your data, you also need to ready your employees. Specifically, you need to consider how long it will take for your whole company to fully adopt this new system.

As aforementioned, almost half of businesses fail to meet their predicted implementation deadline. To avoid this in your business, you need to thoroughly examine your new software features and the current understanding and skillsets of all your employees.

Task your ERP project team to identify the following:

·      Training requirements – Are there any new skills that your employees will need to acquire to successfully use the software, or can skills be transferred from their use of previous ERP solutions?

·      Resources required – i.e., training materials and how-to guides. If the new software is particularly complicated, could you utilise a learning management system (LMS)?

·      Key implementation dates – i.e., the date the software will be procured, employee training dates, etc.

Once you’ve considered all aspects of the migration process itself, you can move on to configuring your new software.

Phase 5 – Configuration and customisation

In this phase, you’ll work closely with the ERP provider to configure the software. The ERP will be modified to fit your company’s mould. This will allow it to seamlessly integrate with your current business processes.

As the software is configured, data should be transferred, and employee training sessions should be held. This will ensure that once all necessary modifications have been completed, the ERP will be ready to use, and your staff will know how to use it.

Phase 6 – Testing

In between configuration and the new system going live, you need to conduct rigorous testing. To do this, you should scenario test. This involves making a list of uses for your new system, creating scenarios for each of these use cases, and simulating these scenarios to test how your system performs.

Hopefully, this testing will prove that your new system meets your expectations exactly. However, testing can also bring to light the limitations of the system.

Take note of all the issues you find with the system and work to resolve them before going live. This will minimise business disruptions and keep your implementation process on schedule.

Besides scenario testing, you should also try user acceptance testing (UAT) and stress testing.  

Testing can either be automated or performed manually. A new study by test automation platform Opkey found that the most common method of ERP testing is manually via a partner, with 32% of businesses selecting this option.

Phase 7 – Going live and beyond

Once you’ve resolved any errors, trained your staff sufficiently, and inputted data, you can go live with your new ERP platform.

Deployment can either be performed all at once or incrementally, depending on the scale and type of ERP system you’re adopting. It might be a good strategic idea to deploy the most important modules first and wait until the basics are mastered before going live with the rest of the system. This will curb the number of potential errors that could occur and mitigate the stress of the migration.

It would also be a good idea to continue to run your old systems throughout the deployment process. The old systems will act as a safety net should the new system totally fail. As the new system stabilises, you can gradually phase out the old tools.

Despite your rigorous preparation, you may find that things go wrong during the first couple of days after going live. Instead of leaving these issues to develop, you need to deal with them promptly. Make sure your project team are on hand in all departments to provide assistance and additional training where necessary.

Once deployed, check in with your employees regularly and provide as much support as possible. Monitoring the new system on an ongoing basis is also crucial, as is adding additional features and correcting errors when necessary.

There’s always room for improvement when it comes to ERP systems. Keep your software updated and reconfigure the system as your company’s needs change and develop.


How YourShortlist can help

As we’ve already made clear, there are no shortcuts when it comes to implementing a new ERP system in your workplace. However, you can simplify the process of scanning through the huge list of ERP providers only to identify options that are only potentially good for your business.

YourShortlist can narrow down this list on your behalf and produce a list of providers that are a good match for your business. 

Instead of spending 17 weeks to find an ERP, let us do the finding for you.

Our job is to make software procurement as easy as possible by matching your business with providers that meet your requirements exactly.

Get a head start in the implementation process by taking advantage of our database of 680 software providers.

Get in touch with us today!