CRITICAL SUCCESS FACTORS OF ERP

1. Clear understanding of strategic goals

Strategic goals and vision are important in the implementation of ERP system. For
the implementation of ERP system, the top management must take into consideration that
how to meet the customer and employee needs and how to establish good relation with
suppliers. The firm must also describe the reason of implementing such a system. The
organization of apparent objectives is critical for implementing ERP system. This factor is
important for the successful implementation of ERP system.

2. Commitment by top management

Better management, loyalty and involvement of top management are needed for the
success of ERP system implementation. Commitment and guidance from top management
has played a vital role in reengineering different processes. This commitment should be
throughout the implementation process and should be on regular basis in the form of
meetings. Top management also motivates the staff to show their creativity. The role of
senior executives in this change process is very important. Enough funding and provision of
resources is directly related with the successful implementation of ERP system, and this
provision of finances and all required resources is the liability of top management. Top
management support is considered an important in the successful implementation of ERP
system. Top management support is helpful in handling challenges in the implementation of
information technology. Also, the proficient and capable project manager plays an
important role in the success of ERP system implementation. Top management commitment
has a definite relation with the successful ERP system implementation. Implementation of
ERP is very expensive, so it is the responsibility of top management to select some suitable
vendor. Commitment from top executive is very important in the ERP system
implementation. Ngai, Law, & F.K.Wat, stated that commitment of seniors is an important
success factor in implementing ERP system and this aspect is independent in all over the
world. Therefore, we can say commitment from senior administration is a key catalyst in the
implementation of ERP system.

3. Excellent project management

The whole firm must actively participate in project management for the success of
ERP system implementation. In it there is a thorough description of goals and which goals
we have attained. The project plan should be attainable. The growing complexity of the ERP
implementation can be managed effectively through the knowledge, skills, tools and
techniques of Project management principles. According to (Fiona Fui-Hoon Nah, 2003)
regular reports and project updates can help management monitor the progress of the
implementation effort.
Excellent training and H.R department plays an important role in project
management. Successful project management means that ERP system is working as it was
planned. Also, the project will not be complex and the implementation will be as agenda.
Finally, thorough ERP system plan and unambiguous objectives are important in project
management for successful ERP system. To manage a project efficiently is a CSF in ERP
implementation. (Bingi, Sharma, & Godla, 1999) stated that the main causes of ERP system
failure are improper assistance and supervision from top management.
4. Organizational change management
The structure and procedures of every firm are very different from the structure and
data of ERP system. Every ERP system uses its personal common sense on the firm’s
traditions and strategy. So, there is a transformation process whenever a company
implements ERP system. The implementation of an ERP system can cause major changes in
the company culture. There must be training of the people to face any sudden change so
that there will be no opposition. For this purpose, there should be considerable flexibility in
any firm’s traditions. Also, there should be participation of end users in the planning and
implementation of ERP system and it is possible after appropriate training of staff. To handle
any conflict is a very challenging for any firm and to satisfy all the people inside the
company that new procedures and methods are better and beneficial. This confliction is
because there is a change in their job nature with the implementation of such software. The
firm must be aware of the probable results of any change process. Resistance to change has
a significant influence on the successful implementation of ERP systems. The big challenge in
the successful implementation of ERP is confrontation to change. This resistance is because
there is an ambiguity about the success of a new system.

5. A great implementation team

A great implementation team: Superior people in terms of their history
achievements, status and caliber are included in ERP system team and they must be
responsible. Senior executives must make sure that project team is consisting of competent
workforce. Communication of top management with team member should be on regular
basis and there must be a concept of empowerment.
The selection of team members increases the chances of success in implementing
ERP system. There should be a correct combination of team members from different
departments in an organization. There should be diversity in the selection of ERP team
members. It should include consultants and internal staff. There should be reward for team
members on the successful implementation of ERP. Chances of successful implementation
increases provided there is an appropriate combination of IT personnel, consultants and
senior executives. Implementation team include different key people such as functional & IT
personnel, upper management, IT consultants, management consultants and ERP &
hardware vendor.
6. Data accuracy
Accurate data entry is very important in the successful implementation of ERP
system. If anyone puts the incorrect data, it will have a harmful consequence on the entire
organization. All the team members must be aware about consequences of incorrect data
entry before the implementation of ERP system. When the new system is implemented, the
whole workforce should be persuaded on its use and the previous system should be
deleted. If there are both new and old systems in an organization, there is a possibility that
few staff members persist on previous system.

7. Extensive education and training

Another important CSF in the successful implementation of ERP system is to provide
proper guidance and instructions to the workforce. The guidance and education provided to
the staff is an important CSF. The services of consultant may also be taken to accomplish
training session. If there is an insufficient training, it may lead to the stoppage of system. An
organization can gain the advantages of a new system if proper education and guidance is
provided to the workforce prior to implementation of ERP system. The purpose of this
guidance and training is to enhance the satisfaction of personnel with ERP system. Also, the
instructions given to clients and suppliers have a significant role in the successful
implementation of ERP software. To get training, team members sent to professionals
having vast experience. After getting training, they arrive in organization to train the other
end users. There is a strong association between change management and training and
support. Because of training and guidance, workforce has come to know that how their
every act has an impact on the overall organization.

8. Focused performance measures

There are performance measures to appraise the benefits of latest ERP system.
These measures point out whether the system is going successful or not. These measures
specify that delivery is on time, time period between customer order and shipment to
customer and vendor routine. The performance of a new system should be evaluated
continuously.
Top executives and the staff members think that benefits of new system will appear
as soon as the new system is implemented. But there may be reduction in yield or outcome
at beginning because the system is very complicated. With the passage of time, as
awareness with the system increases the ERP benefits will also increases.

9. Business process reengineering (BPR) and minimum customization

There are two ways of ERP implementation in any organization.
1. Implementation of ERP system package in its original form with little or no
modification.
2. Modification of system from a standardized form to fit the existing business processes.
The redesigning of existing processes with least modification of ERP system is an
important CSF in the implementation of ERP system. This modification has an impact on
each module because they are highly integrated. This BPR should be on regular basis, so to
gain competitiveness. There is instability in ERP system, if there is more modification. To
avoid this, the organization ought to redesign their course of action without modification of
software because the ERP packages are made according to the most excellent ways of doing
business. If ERP system is implemented without customization, we can say it is in vanilla
form. And if the system is implemented in vanilla form, there is reduction in the
implementation time and cost.
CONCLUSION

The purpose of the study is to understand the importance of implementing ERP systems in
Pakistan based organizations. The study identifies the key factors required for successful
implementation of ERP system. These include top management support, functional support,
good implementation partner, strong and meaningful training programs, user’s involvement
and participation, quality of ERP team, Strong MIS department, Good planning for the ERP
project, overall support for the ERP in the organization, efficient change management, good
IT infrastructure, great ERP software selected, and good understanding of the concept of
ERP. After prioritization of the mean, it is identified that the most important factor for an
organization to implement successful ERP system is top management support as without the
guidance and commitment of top management, ERP system can never provide satisfactory
results. The second factor that is important is functional support, which can be a hurdle in a
way of implementation if not available. A good implementation partner is identified as the
third most important factor. The findings of this study may be helpful for the professionals
and researches that either plan to implement ERP or to conduct research.
Clear understanding of strategic goals
Strategic objectives and vision are critical within the execution of ERP framework. For the usage of
ERP framework, the best administration must take into thought that how to meet the client and
employee needs and how to set up great connection with providers. The firm must also portray the
reason of actualizing such a framework. The organization of clear goals is basic for executing ERP
framework. This is vital for the effective usage of ERP system.

Commitment by top management

SUPERIOR ADMINISTRATION, LOYALTY AND ASSOCIATION OF TOP MANAGEMENT ARE
REQUIRED FOR THE SUCCESS OF ERP FRAMEWORK USAGE. COMMITMENT AND DIRECTION
FROM TOP MANAGEMENT HAS PLAYED A CRUCIAL PART IN REENGINEERING DISTINCTIVE
FORMS. THIS COMMITMENT OUGHT TO BE THROUGHOUT THE EXECUTION PROCESS AND
OUGHT TO BE ON NORMAL PREMISE WITHIN THE FORM OF MEETINGS. TOP MANAGEMENT
MOREOVER ENCOURAGES THE STAFF TO EXPRESS THEIR IMAGINATION. THE PART OF
SENIOR OFFICIALS IN THIS CHANGE PROCESS IS EXCEPTIONALLY VITAL. TOP MANAGEMENT
SUPPORT IS CONSIDERED CRITICAL WITHIN THE EFFECTIVE EXECUTION OF ERP
FRAMEWORK.
Top administration support is helpful in dealing with difficulties in the execution of
information innovation. Likewise, the proficient and able task director assumes a significant
part in the accomplishment of ERP framework execution. Top administration responsibility
has a definite connection with the successful ERP framework execution. Execution of ERP is
pricey, so it is the obligation of top administration to choose some appropriate seller.
Responsibility from top chief is vital in the ERP framework execution. Ngai, Law, and
F.K.Wat, expressed that responsibility of seniors is a significant achievement factor in
carrying out ERP framework and this viewpoint is autonomous in everywhere on the world.
Therefore, we can say responsibility from senior organization is a key impetus in the
execution of ERP framework.

Excellent project management

The entire firm should effectively take an interest in project management for the
achievement of ERP framework execution. In its anything but an intensive depiction of
objectives and which objectives we have achieved. The task plan ought to be feasible. The
developing complexity of the ERP execution can be overseen successfully through the
information, abilities, apparatuses and methods of Project management principles. As
indicated by (Fiona Fui-Hoon Nah, 2003) ordinary reports and venture updates can help the
management monitor the advancement of the execution exertion.
Superb training and H.R division assumes a significant part in project management.
Successful project management implies that ERP framework is functioning as it was
arranged. Likewise, the task won't be unpredictable and the execution will be as plan. At
last, careful ERP framework plan and unambiguous targets are significant in project
management for fruitful ERP framework. To deal with an undertaking effectively is a CSF in
ERP execution. (Bingi, Sharma, and Godla, 1999) expressed that the fundamental driver of
ERP framework disappointment are ill-advised help and oversight from top administration.

Organizational change management

The design and methods of each firm are altogether different from the design and
information of ERP framework. Each ERP framework utilizes its own good judgment on the
company's customs and system. Along these lines, there is a change cycle at whatever point
an organization carries out ERP framework. The execution of an ERP framework can cause
significant changes in the organization culture. There must be training of individuals to
confront any abrupt change so that there will be no resistance.
For this reason, there ought to be extensive adaptability in any company's customs.
Additionally, there ought to be interest of end clients in the arranging and execution of ERP
framework and it is conceivable after proper training of staff. To deal with any problem is
challenging for any firm and to fulfill every individual inside the organization those new
systems and strategies are better and helpful. This confliction is on the grounds that there is
an adjustment of their work nature with the execution of such programming. The firm
should know about the plausible aftereffects of any change interaction. Protection from
change affects the effective execution of ERP frameworks. The huge challenge in the
effective execution of ERP is a confrontation to change. This opposition is on the grounds
that there is an ambiguity about the accomplishment of another framework.

A great implementation team

SUPERIOR PEOPLE AS FAR AS THEIR SET OF EXPERIENCES ACCOMPLISHMENTS, STATUS AND
CALIBRE ARE REMEMBERED FOR ERP FRAMEWORK GROUP AND THEY SHOULD BE DEPENDABLE.
SENIOR CHIEFS SHOULD ENSURE THAT PROJECT GROUP IS COMPRISING OF ABLE LABOR FORCE.
COMMUNICATION OF TOP ADMINISTRATION WITH COLLEAGUE OUGHT TO BE ON STANDARD
PREMISE AND THERE SHOULD BE AN IDEA OF STRENGTHENING.

THE CHOICE OF COLLEAGUES EXPANDS THE CHANCES OF ACHIEVEMENT IN EXECUTING ERP

FRAMEWORK. THERE OUGHT TO BE A RIGHT MIX OF COLLEAGUES FROM VARIOUS DIVISIONS IN
AN ASSOCIATION. THERE OUGHT TO BE A VARIETY IN THE CHOICE OF ERP COLLEAGUES. IT
OUGHT TO INCORPORATE ADVISORS AND INTERNAL STAFF. THERE OUGHT TO BE AWARDS FOR
COLLEAGUES ON THE FRUITFUL EXECUTION OF ERP. CHANCES OF FRUITFUL EXECUTION
INCREMENTS GAVE THERE IS A PROPER MIX OF IT FACULTY, EXPERTS AND SENIOR CHIEFS.
EXECUTION GROUP INCORPORATE DIVERSE KEY INDIVIDUALS, FOR EXAMPLE, USEFUL AND IT
WORK FORCE, UPPER ADMINISTRATION, IT SPECIALISTS, THE BOARD ADVISORS AND ERP AND
EQUIPMENT MERCHANT.

Data accuracy
ACCURATE DATA ENTRY IS VITAL IN THE FRUITFUL EXECUTION OF ERP FRAMEWORK. IN THE EVENT THAT
ANYBODY PUTS THE ERRONEOUS INFORMATION, IT'S ANYTHING BUT A DESTRUCTIVE OUTCOME ON THE WHOLE
ASSOCIATION. ALL THE COLLEAGUES SHOULD KNOW ABOUT OUTCOMES OF INACCURATE INFORMATION
SECTION BEFORE THE EXECUTION OF ERP FRAMEWORK. AT THE POINT WHEN THE NEW FRAMEWORK IS
EXECUTED, THE ENTIRE LABOR FORCE OUGHT TO BE CONVINCED ON ITS UTILIZATION AND THE PAST
FRAMEWORK OUGHT TO BE ERASED. IN THE EVENT THAT THERE ARE BOTH NEW AND OLD FRAMEWORKS IN AN
ASSOCIATION, THERE IS A LIKELIHOOD THAT COUPLE OF STAFF INDIVIDUALS CONTINUE ON PAST FRAMEWORK.

Extensive education and training

Another significant CSF in the effective execution of ERP framework is to give legitimate
direction and guidelines to the labor force. The direction and training gave to the staff is a
significant CSF. The administrations of expert may likewise be taken to achieve instructional
meeting. On the off chance that there is a lacking preparing, it might prompt the stoppage
of framework. An association can acquire the upsides of another framework if legitimate
schooling and direction is given to the labor force preceding execution of ERP framework.
The reason for this direction and training is to improve the fulfillment of staff with ERP
framework. Too, the enlightening given to clients and providers have a critical part within
the fruitful implementation of ERP program. To urge training, group individuals sent to
experts having tremendous involvement. After getting training, they arrive in organization to
give sessions to the other end clients. There's a solid affiliation between change
management and training and support. Because of training and guidance, workforce has
come to know that how each act has an effect on the generally organization.

Focused performance measures

THERE ARE PERFORMANCE MEASURES TO APPRAISE THE BENEFITS OF LATEST ERP SYSTEM. THESE MEASURES
POINT OUT WHETHER THE SYSTEM IS GOING SUCCESSFUL OR NOT. THESE MEASURES SPECIFY THAT DELIVERY IS
ON TIME, TIME PERIOD BETWEEN CUSTOMER ORDER AND SHIPMENT TO CUSTOMER AND VENDOR ROUTINE.
THE PERFORMANCE OF A NEW SYSTEM SHOULD BE EVALUATED CONTINUOUSLY.
TOP EXECUTIVES AND THE STAFF MEMBERS THINK THAT BENEFITS OF NEW SYSTEM WILL APPEAR AS
SOON AS THE NEW SYSTEM IS IMPLEMENTED. BUT THERE MAY BE REDUCTION IN YIELD OR OUTCOME AT
BEGINNING BECAUSE THE SYSTEM IS VERY COMPLICATED. WITH THE PASSAGE OF TIME, AS AWARENESS WITH
THE SYSTEM INCREASES THE ERP BENEFITS WILL ALSO INCREASES.

Business process reengineering (BPR) and minimum customization

There are two ways of ERP implementation in any organization.
1. Implementation of ERP system package in its original form with little or no
modification.
2. Modification of system from a standardized form to fit the existing business processes.
THE UPDATING OF EXISTING CYCLES WITH LEAST ALTERATION OF ERP FRAMEWORK IS A SIGNIFICANT CSF IN
THE EXECUTION OF ERP FRAMEWORK. THIS ALTERATION AFFECTS EVERY MODULE SINCE THEY ARE
PROFOUNDLY COORDINATED. THIS BPR OUGHT TO BE ON ORDINARY PREMISE, SO TO ACQUIRE
COMPETITIVENESS. THERE IS INSTABILITY IN ERP FRAMEWORK, IF THERE IS MORE ALTERATION. TO STAY AWAY
FROM THIS, THE ASSOCIATION SHOULD UPDATE THEIR GAME-PLAN WITHOUT CHANGE OF PROGRAMMING IN
LIGHT OF THE FACT THAT THE ERP BUNDLES ARE MADE BY THE MOST INCREDIBLE METHODS OF WORKING
TOGETHER. IN THE EVENT THAT ERP FRAMEWORK IS EXECUTED WITHOUT CUSTOMIZATION, WE CAN SAY IT IS
IN VANILLA STRUCTURE. FURTHERMORE, IF THE FRAMEWORK IS CARRIED OUT IN VANILLA STRUCTURE, THERE IS
DECREASE IN THE EXECUTION TIME AND COST.