How EA can help to promote successful implementation of ERP initiatives? Read On!
Why does the tremendous promise of Enterprise Resource Planning (ERP) remain unfulfilled? Why do ERP implementations fail? The single biggest factor may be the lack of an enterprise architecture.
An Enterprise Architecture models the organization depicting its essential elements or components and their inter-relationship. This helps clearly “see” the implications and impact of introducing a new component into the business. For example, an EA can show you how a new application complements existing functionality, where the overlaps are, and what it needs to connect with. The lack of an EA increases the risk of waste and mismanagement and more importantly, a cohesive and coherent IT capability.
An application must not be implemented without an enterprise architecture. Period.
This issue is exacerbated exponentially if one is implementing an Enterprise Resource Planning (ERP) system. Why? Because an ERP combines multiple sets of functions, requires change in processes and integration with multiple systems, just to scratch the surface!
CIOs must learn why and how to use EA with ERP or risk (guarantee?) a failed implementation.
Enterprise Architecture (EA) is a strategic approach to organizing and managing an enterprise's information technology (IT) resources. It helps an organization align its IT resources with its business goals and strategies. EA is not just about technology, but also includes processes, procedures, people, and organizational structures. The goal of EA is to improve the efficiency and effectiveness of an enterprise by creating a coordinated and consistent architecture across all of its IT systems.
The purpose of Enterprise Architecture (EA) is to provide a blueprint for the organization that shows how everything works together. This is especially important when it comes to integrating a new ERP system. During the scoping phase, EA identifies all the systems and applications that will need to connect to the ERP in order to deliver information or complete some business function. During implementation, especially during the planning phase, EA provides methods used by the organization for integration. This allows the ERP team to work with other teams in a coordinated manner and avoid any surprises during go-live.
A successful ERP implementation hinges on getting the right information to the right people at the right time. Organizations that have implemented an ERP system know that their data is stored in the system, but they often find it difficult to access and make use of this data for decision making. A modular EA solution, integrated with the ERP, can help organizations implement strategy, define objectives, set targets, and measure progress against these goals.
ERP systems implementations often involve the introduction of new or upgraded applications software in a number of functional areas across an enterprise. In order to manage this process and ensure that all aspects of the business are considered, EA is used. In that EA documents and links an enterprise’s strategic goals, business processes, and technology solutions, ERP applications are part of EA. For example, when a company wants to upgrade its ERP system, it will go through an EA process to determine which parts of the business need upgrading and what new functionality is required. This helps to ensure that ERP implementations are done in line with the organization's overall strategy and objectives, minimizing the risk of failure. Furthermore, EA can help to identify potential obstacles to success and the impact on existing processes and resources before and after the implementation. By documenting lessons learned, EA can help to promote the successful implementation of future ERP initiatives.
An integrated EA/ERP solution offers many benefits, the most notable being data accuracy and validity. This is because the data can be traced back to its original source, making it more reliable. Furthermore, deploying an integrated EA/ERP solution is cost effective as no additional investment is required for third-party tools. Additionally, a modular software allows for a flexible deployment, which means that the solution can be started with any component. Lastly, timely information is ensured as there are no delays caused by real time data.
This paper examines the relationship between Enterprise Architecture and Enterprise Resource Planning system and how an EA approach ensures the success of an ERP initiative. It provides a comprehensive understanding of the concept and scope of EA and ERP systems including case studies of combining EA and ERP systems.
It contends that ERP systems alone cannot create a competitive advantage; the full potential of an ERP system can only be realized when it is integrated into an EA framework. The future of competition will require organizations to manage resources in a more globalized way and cater to increasingly individualized customers. This will necessitate a change in the way EA and ERP systems are designed and implemented, and the future winners in this space will be those who understand the new competitive paradigm and put it into practice.
Must Login To Download