Don't panic, but it's time to upgrade

Income taxes, your birthday, and ERP upgrades are all annual events to view with equal measures of terror and pleasure.
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Several weeks ago, the controller of a $500-million company told me he couldn't wait until he was able to upgrade his firm to the Web-enabled version of its Oracle Corp. enterprise resource planning suite (to version 11i from 10.7). The ability to access information easily, from anywhere, was irresistible, he said. Score another victory for Oracle's salesforce.

As an IT manager responsible for the operation of an ERP system, you are going to hear quite a lot of noise about upgrading your software over the next year or so. Web mania, vendors desperate for sales, and the lure of unusually compelling new bells and whistles will make the latest versions of ERP software too tempting to resist by business users. Although they may not use all the modules, people usually upgrade the entire suite. In a few years, they won't have to, but right now it's generally an all-or-nothing proposition. However, you remember the pain, suffering, and budget chaos that resulted from the initial ERP implementation, and you don't want to go through that again while you're still dealing with Y2K issues. And don't forget the clipping you still have from The Wall Street Journal that compared ERP implementations to a corporate root canal operation. The pain lingers.

The Business Side Rules
Roughly one-third of an Oracle ERP implementation involved IT resources, specifically DBA support. Most of the effort was borne by the business side.

Database administrator (DBA)
Manufacturing systems staff
Finance staff
Project management

Upgrading a mid-sized manufacturing company's Oracle ERP implementation consumed about 2,230 hours of staff and consultant time over a three-month period, according to the consultant involved in the project, Daniel Reilly of Reilly & Associates Inc. Consultant time accounted for roughly 40% of the total hours involved.

Source: Reilly & Associates Inc.,

Let me offer you some relief. After talking to a score of ERP upgrade veterans over the past few years, as well as having discussions with vendors and implementation partners, I think your fears exceed the reality. Depending on the condition of your current ERP system and the level of good implementation practices embraced during the initial install, an upgrade may not be a big deal. Indeed, I've talked with several IT managers recently who claim that the cost of their implementation was included in their normal, annual operating budget.

But don't think an upgrade is as simple as loading a CD into a server and letting the Upgrade Wizard whirl for a few minutes. Go back and review your diary of the original ERP implementation and try to avoid repeating the mistakes you made the first time.

First, it's a business project

What's crucial to the success of an initial ERP implementation, as well as an upgrade, is understanding the nature and purpose of the project. An ERP upgrade is not an IT project. While you may lust after the latest version of Oracle 11i, PeopleSoft version 8.0, or version 4.5 of SAP R/3 so you can play with Java and otherwise enjoy the latest and greatest code that the vendors offer, that's not the reason your organization should upgrade. An ERP upgrade is a business project.

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