ERP | OpenERP Implementations

eCommerce websites are becoming one of the most powerful medium for online buying and selling of goods & Services. May companies are now focussing on their online store as it allows them cost effectiveness and selling the products and services at low rates as compare to bear the expenses of virtual stores.

There are many platforms available where an eCommerce vendor can choose from, but there is no distrust that Magento is considered as one of the most influential eCommerce platform. The reason behind this is being Open source Magento is one of the strong ecommerce platform available today. Another important advantage of using Magento is that it enable the store owner to install, run & customize it easily.

Magento eCommerce store allows you to have integration with the payment gateways, Analytics other extensions etc. It also allows you with variety of themes from where you can choose the best suitable for your store and products.

Some of the powerful services offered by Magento are as follows

- Quick operation

- Easy integration with 3rd party tools

- Categories and Product management

- Shipping management, order management

- Customizations as per user requirements.

- Strong Open source community

- Other support services are available

Apart from the above one of the most important feature is that Magento is having user friendly interface.

We always learnt during our management studies “Doing right things at a right time” to ensure smoothness in business operations and this can be accomplish when you have a proper processes in place from different department. It also applies where you are ensuring to contact right person in your organization to get the work done on time.

Business Process Management – workflow management helps you to increase and the capability of each department. Company can easily track different processes of their departments to track the work completion. It allows you to take necessary actions in terms of delays in the work from one department. Apart from that business process management tools helps every employee to complete their duties and task with the help of certain clicks.

Another advantage of a BPM tool is that the person who is initiating the case does not need to worry as it allows you with information through emails, sms on the task done by different department. It also allows the company to become global, say for example a product concept is created in one place and design done in another place and so on. Today BPM – Business process management is considered as one of the emerging technology to improve the efficiency of business. It includes component of workflow management, document management, business rules and ERP integrations.

Thus, work flow solution can help a company to improve its performance dramatically.

Software development industry mainy drives their project life cycles through two approaches.

1. Traditional software development approach/Waterfall method.

2. Agile methodology

Before choosing a vendor for software development or specifically for custom software development it is important to get familiar with these 2 methods to see which method is best suitable for business requirements.

Let’s start with the Traditional software method; normally these practices are broken down into different phases. The initiation starts from the set up of the requirement to see the timelines and implementation bias. After the requirements are done second step is to design the diagrams and models to provide a road map for the developers.

Further moving on after the road map is created the third phase consist of the development of the project. The development is broken into smaller task which is distributed among various teams depending on the skills. During the project execution normally testing part is done to avoid bugs in later stage. And after the project comes to completion the customer start the testing of the software and after the client is satisfied the project is delivered

Summary of Traditional Approach:

Requirement set up – Design – Development – Testing – Customer Testing – Project delivery

The main feature for implementing through tradition approach is heavy documentation, which allows you to set the timelines and project implementation requirement clearly before start. Because of this there are chances where changes in the requirement will affect the development. Although in real software development there are various problems that may arise as there might be change in the company processes or other changes during the development phase. Because the Tradition approach to software development does don’t provide changing ability to address the issues. Hence a little more flexible approach specifically for custom development is agile methodology.

In Agile method the more concentration is on the proper completion of the task through team collaboration. This phase rarely rely on the documentation part to measure the progress of the project. Hence agile development is not restricted to Functional requirement document. Agile method is followed in case of dynamic needs of the project or custom software development.

The Approach of agile development:

In Agile method the tasks are broken into small increment which is also known as iteration having short cycles which complete in 2 to 4 weeks. Further iteration follows the similar process of traditional software development which is as follows:

Requirement set up – Design & Development – Client Demo – Re- evaluation – Phase delivery

In the above if you see the customer involvement is very necessary as in every small phase the client testing is require to see if any alterations or customizations require in the development process. The Agile method involves different iteration to complete the total project requirements. Another advantage of Agile Methodology is the client receive working version of the software as the development happens in phases which decrease the risk of ROI – return on investment and provide the client with continuous feedback on the software development.

There are very less risk in Project delivery if a firm opt for agile methodology but it should be noted that with Agile development the vendor who is developing the software must be very experience to give proper timelines on the project & customization points. Another important point to be consider while applying agile methodology is that this method highly dependent on customer feedback and their involvement. If client doesn’t have time to invest then it may be difficult to do development through Agile.

From the above differentiation we can say that both waterfall and agile development methods are workable solutions with success. But to summarize in short Waterfall strategy are applied when the project requirements are very much clear and do not need customizations. And agile development is applied when the project requires flexibility and customization as per business processes.

Enterprise resource planning (ERP) system implementation is been done from past two decades and ERP systems is considered as one of the most powerful Business Management software, as it covers every department with one single software. ERP implementation is one of the biggest question arise as sometime it involve a huge timelines towards the development. An ERP implementation can be perform in Phase manner as shown in the example below.

For a typical ERP project, various phases are as follow:

• Project initiation phase :
  

ERP project beginning is one of the most important phase as in this phase, You plan on certain initiation points such as Team formation, Project planning and fine tuning of every aspects of the business. In any successful implementation there are certain skills require checking the best expertises availability for the project. It also includes Key user team, IT personnel, Project implementation group etc.

It includes the vendor team onsite for the creation of functional requirement document and understanding the business aspects & Project administration plan. Some of the expected output from these phases is the project implementation committee formation, delivery and installation of default ERP application to judge the capability.

• Development & GAP Detection Phase:
  

The second phase in ERP implementation is the development and GAP detection phase. In this phase main users and other team map the existing processes with the default functions available in the vanilla or existing ERP software. This happens with the vendor team.  Other parts include in the development phase is the Customization points identification where a separate customization document can be prepared for details.

• Software Customization Phase:
  

This phase includes the development & customization of all the Modules which will apply in the ERP system. This phase also includes the testing of the modules, unit testing based on the plans developed by the vendor. This phase can be onsite or offsite depending on the company decision

• Acceptance Testing:

Acceptance testing phase is another important part towards the implementation of ERP software. It allows you to see that the system works properly. This phase also include the creation of manuals if required. This phase helps you in quality control of the code from user perspective and technical perspective.

• Training Phase:

After acceptance testing all the end users are trained for their specific functions. For example. There will be different set of training for sales management teams, similarly for purchase, Accounts, Manufacturing etc. This training is conducted by the vendor team and again this can be online or offsite.  Another alternative provided by the vendor on training part is the “training videos” where new users can see the videos and learn on the ERP process part.

• Data migration phase:

After the user training phase the data migration phase starts where all the existing data is transferred into ERP system. This phase also include the establishment of access rights and passwords, Data conversion etc.

• Go Live:

After the final data is loaded with the user roles and hierarchy creation, the ERP system is ready to have go live position. This is the final phase where a final training might be required. And this is the phase where the users work on real time data in the ERP software.

The above points may differ from vendor perspective or ERP product perspective. An organization may use various strategies or add other phases in the above to achieve success in ERP implementation.

SME

Enterprise Resource planning – ERP software used by big organization to manage their business process and to gain competitive edge in the business area. Any ERP software is selected to streamline their internal business processes. But now the focus of an ERP software implementation is changing from big organization to small and mid sized companies or SMB’s. Previously this was not the case with SME’s as any ERP implementation required heavy investment, time, effort money and due to high risks

Today SME’s are implementing ERP  and business software to gain the advantages of a Proper enterprise resource planning tool and this is because of Open source ERP  software available in the market easily with different modules to start with. Open source ERP software is attracting small and medium sized enterprises to implement ERP solution to manage their business. Another part is lots of ERP vendors started implementing ERP solutions for SME & SMB as the market is huge.

Let’s have a look on the most powerful points where SME are opting for Open source ERP solutions for their businesses.

Costing : One of the most important factors affecting SME to opt for Open source ERP software is the cost. As Open source allows you free code and installation and the company doesn’t have to pay heavy software licence fees every year, which was one of the case with the proprietary ERP software. Hence being costing is one of the factor and Open source ERP doesn’t involve any license fees and maintenance cost.

Easy and quick implementation : As being open to the community and lots of implementation material available online it get easy to implement open source ERP  with the help of technical team, SME’s can also opt for vendor implementation options if require.

Flexible: Another important point of selecting Open source ERP  software is the flexibility and customization ability in the tool, which is very difficult with the proprietary software and that too it involves high investment for certain customization.

Freedom: Open source provides you with the freedom, freedom from the vendor locking, freedom from licensing and so on. The source code of the Open source ERP software is with the client where he can modify in further future and can take support from the vendor whenever necessary.

Training and support: The support and bug fixing gets easy as communities are open to help for the bug fixing part; also the training after the implementation is minimal as compare to the Proprietary

We have covered some of the advantages on why SME’s are opting for open source ERP software but there are disadvantages too if not selected properly. It is necessary for an SME to do a proper study of their business processes before selecting Open source ERP package accordingly. There are lots of Open source ERP software available in the market some of them are OpenERP , OpenBravo, Compiere and so on. . Normally open source ERP software are targeted to those companies whose needs are not covered by the normal ERP  software available in the market and organization whose processes are not standard