Taking the Agile Route to ERP Implementation
Kallol Basu

The pandemic has forced companies to relook at their operational resilience, putting impetus in accelerating enterprise resource planning (ERP) enabled digital transformation. However ERP implementations are extremely time-consuming, complex, and often fail to accrue the intended benefits. The key reasons for this include:

Misalignment among stakeholders on program goals
Lack of requisite program governance and business stakeholder involvement
Lack of quick decision-making elongating the implementation cycle
Deliverable-driven rather than outcome-driven
Primarily waterfall approach ensuring long lead time to deliver value and high risk of failure

So why not take the agile route? ERP implementations are deemed to be too complex for management by small agile teams. Requirements cannot be broken down to stories executable in sprints. Being cloud products, customizations should be kept bare minimum, thereby not encompassing constantly changing requirements. ERP solution cannot be meaningfully demonstrable to end users in incremental fashion till it is fully built and functionally integrated. Non-functional elements are intertwined impeding sprint-wise breakdowns. Challenges also include key decision governance requirements, synchronization between scrum teams, and integration of shared resources.

An agile approach has potential to dramatically streamline ERP projects, making them rapid, adaptive, and business-focused. Some agile program management practices can be applied directly.

Empowered self-organized small, end-to-end, cross-functional teams including business and IT, jointly working towards business outcomes and value creation. It       involves greater transparency for quicker decision making.
Replace long waterfall phases with sprints to enable progress/ benefits tracking. Functional scope can be broken into smaller set of features (customizations) executable in sprints.
Scrum based ceremonies to drastically facilitate continuous improvements and visibility,
Certain phases like system integration training or user acceptance testing made agile through automation, thereby optimizing delivery process.

Some agile practices need modified application. Entire scope must be defined upfront at high level with clear acceptance criteria. To enable grouping, more emphasis should be given to business processes and architecture than traditional agile. Functional and non-functional teams need close synchronization. Phase of end-to-end testing and cut-over is mandatory to consolidate increments delivered by teams and test complex interfaces with legacy applications -- this cannot follow sprint methodology.

How does this apply to phases? Determining/defining phases can be accelerated by doing high-level rapid fit-gap analysis through pre-configured solutions and show-and-tell workshops iteratively in sprints with business stakeholders. High-level macro feature roadmap is created which is elaborated subsequently. Strong project management office (PMO) will coordinate the functional and nonfunctional workstreams, thereby accelerating the cycle and eliciting early user feedback. Re-evaluating the progress periodically presents opportunities for course correction.

During implementation, functional delivery teams can adopt scrum easily through design, development, and system testing in sprints. End-to-end testing and UAT are conducted regularly to improve code-quality and test automation. Non-functional work largely needs to follow a traditional approach, regularly synchronizing with a functional workstream. Instead of proceeding with delivery of the system with all planned project features, at each sprint end, a configurable and testable function is available for release adding incremental value to the final product.

Deploying the solution is largely non-agile, although it can happen frequently to mitigate early deployment risk. Hypercare phase is shorter due to continuous focus on quality. Adopting agile methods enables DevOps execution – automation and analysis techniques to optimize collaboration across development and operations, enabling faster, more predictable frequent deployments.

Application of agile project management can help foster greater customer centricity, faster time to market, lower costs, and more engaged workforce, resulting in better change adoption by end users as they can view measurable progress. Design and testing durations are reduced. More workload can be compressed into a period through parallelization of functional teams. Industrializing agile approach can thus mitigate challenges of ERP transformation around people, process and technology dimensions.

(Kallol Basu is a senior business partner with Tata Consultancy Services, specializing in organizational change management. He has worked on large business transformation initiatives, lending his expertise to the areas of program management, change management, and business process re-engineering. With a Ph.D. in business transformation, Mr. Basu has played an instrumental role in multi-year, multi-country customer programs.)