ERP phasing strategies - so many ways to skin a cat

Every large initiative needs a well-thought-out strategy. Without a good plan, you may find yourself lost in the middle of the execution. I have conducted dozens of workshops for my clients to help them develop phasing strategies for their system deployments. It is always a delicate balance between managing the risk and keeping the cost down while delivering the value sooner. There are several business and systems dependencies that need to be considered.

I tend to visualize the project scope as a cube. The volume is the scope itself. The dimensions are business units (brands, divisions, etc.), regions (countries, locations, etc.), and functions (processes, etc.). Phasing is how you slice the cube into smaller pieces. For example, you can take a business unit (ex: brand), pick a region (ex: Canada), and deploy a function (ex: financials). You can then move on to another slice. Some slices need to be done sequentially, while others can be done simultaneously. Some slices can be big; others may be small. Business and technical constraints play a big role in the number of slices (thus their sizes) and the order of the slicing.

Here are a few things to consider. The more you slice, the costlier your project will get - due to temporary interfaces, additional testing, and support. Your deployment risk will come down, yet you may run out of fuel before delivering the full scope due to resource burnout. The less you slice, the more risk you will take. You may save on the overall project cost yet change management can be overwhelming with bigger slices.

Let's play with an example. Imagine a company with two brands (ex: Fire, Ice) in two countries (ex: USA, GBR) deploying two functions (ex: financials, supply chain). In one extreme, we can slice the project into 8 pieces. Let's say we start with Firebrand deploying financials in the USA. Then, we can move to Firebrand expanding financials to GBR. Then, Firebrand can take on to supply chain in the USA. You got the picture. On the other extreme, we may go live with both brands across all functions globally. In real life, a middle ground is found between these two extremes. 

A reasonable approach may be to go live with both brands deploying financials globally first. You can then add supply chain operations for one country and move on to the next. This strategy could easily change if the financials and supply chain functions were both running within the same legacy system in a country. In that case, it would make more sense to keep these functions together and slice the scope either by brand or region. For example, start with one brand in one country for both functions and move on to other slices accordingly. 

It is best practice to study multiple options with their respective pros and cons. Depending on the cost, risk, and time to value preferences, you can make your selection accordingly. Laying out this phasing strategy upfront will be key to your overall success.

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My name is Cem and this has been another gem.