ERP Implementation Strategies: Big Bang vs. Phased
ERP Implementation Strategies
BIG BANG ERP IMPLEMENTATION STRATEGY:
Big bang ERP go-live strategy is the one where all of the main modules of an ERP system go live at the same time.
PHASED ERP IMPLEMENTATION STRATEGY:
A phased approach describes a scenario where elements or modules of the ERP system are introduced in a planned sequence, replacing the old systems gradually.
The feasibility of a strategy is based on the following factors:
1. Impact on the organization
A big bang approach exerts additional pressure on the business and the project team during the cutover – simply because there’s so much activity going on all at once. A phased approach can lead to quick wins, which provides confidence and helps in selling the advantages to the rest of the organization. On the other hand, poor experiences in early phases can lead to the negativity around the ERP project, and in a worst-case scenario, it could even undermine a rollout plan.
2. Temporary Interfaces:
Phased implementations often require temporary interfaces to provide a temporary working solution. It is costly to implement temporary interfaces.
Phased strategy implementation takes longer time than big bang strategy. Factors such as regulatory compliances, acquisitions, new product introductions, and other capital expenditure programs can influence the required timescale for an ERP implementation. Planning the project will need to take these other factors into account and could well influence the big bang versus the phased decision.
4. Business units
Generally, it is easier to manage multi-site and multi-business unit implementations in a phased manner. Except for the scenario involving a hub site with satellite or regional sites dependent on the hub, it may be easier to go big bang for this full group of sites due to the interdependencies involved.
Phased implementations levy:
- Additional external costs
- Additional internal costs
- Additional costs for temporary interfaces
Generally, big bang implementations are much riskier than phased implementations.
- It’s more difficult to revert to the old system if everything goes wrong.
- There’s a higher risk of serious damage to the business.
- Full end-to-end testing is much more difficult to achieve
- A big bang go-live places a huge strain on all parts of the organization
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