The Critical Operational and Strategic Need for ERP IT Project

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Table of Contents

Introduction
Budget request
Organizational Contribution
Works cited

Introduction

Several organizations have embraced technology in their operations. However, it is of paramount importance that entire operations of the organization are integrated. This calls for need of implementation of an Enterprise Resource Planning (ERP). According to Sheilds (8 -12), an ERP is a computer-based system used to manage internal and external resources including tangible assets, financial resources, materials, human resources and intangible resources such as customer relationship management, intra-organizational communication and supplier relations.

Budget request

For the ERP project succeed, it requires total of 102,500 US dollars, this amount is spread as follows: User and Software requirements Specification costs 2,500 dollars, ERP modules acquisition costs 54,000 dollars, system integration costs 20,000, dollars, system testing costs 5,000 dollars, user training costs 12,000 dollars, system installation and commissioning costs 4,000 dollars and annual system maintenance 0f 5,000. However, it is expected that the system shall save the organization 50,000 dollars annually for a period of six years from the installation date.

Organizational Contribution

The ERP shall contribute to integration of organization’s operations since all systems shall utilize a centralized database and reduce data redundancy. It shall also contribute to operational cost reduction due to staff doing the same work; furthermore, ERP contributes to ease management of organizations resources such as human resources, monetary resources and assets. In addition, the ERP project shall improve the organization’s total service delivery.

For the proposal to succeed, 360 degree influential communications issues includes:

Source factors

To be persuasive enough, the budget proposal should originate from a trustworthy source, where the recipients are fond of and appreciate the expertise of the writer. An expert in ERP should therefore be the person to prepare the budget proposal professionally and be able to address effectively, accurately and timely the concerns and recommendations from all concerned stakeholders.

Project Communication plan

Servaes (23 -25) argues that there should be an effective bidirectional communication strategy with all the involved stakeholders. The decision makers’ executives and corporate finance/ budget analysis committee have to be informed on the benefits and the competitive advantage of implementing an ERP such as reducing operational cost and creating a sense of ownership of the project. Communication with other departments is important; for them to understand that ERP shall be of great benefit to all departments in order to focus on the same organizational goal. Users have to be involved to get their training needs and IT department staff; in order to ascertain the available knowledge base. According to Mochal (42 -46), a communication plan affects a project’s success and involves determining communication needs for each stakeholder, brainstorming how to meet the needs, mandatory communication and prioritizing communication options.

Message and audience factors

The understanding of the corporate finance/ budget analysis committee on the budget proposal affects the allocation. Occam’s razor principle argues that that the simplest explanation is usually the best. (Ariew 42 -47). The proposal should therefore be in simple and understandable language, to all the intended audience. All audience should be able to clearly understand that funding the ERP project shall benefit the entire organization to gain competitiveness.

Factual evidence/tools

Concrete unambiguous facts should offered to support the budget proposal, such as ERP outcome benefits versus cost charts, and evidences ERP has benefited other organizations. Graphical representations are included to offer visualized view. Appropriate communication tools which allow for feedback from stakeholders should be used as argued by Svendsen (42 -51).

Works cited

Ariew, Roger. Ockham’s Razor: A Historical and Philosophical Analysis of Ockham’s Principle of Parsimony. Champaign-Urbana: University of Illinois press, 1976.

Mochal, Tom. Lessons in Project Management. New York: Apress, 2007.

Servaes, J. Approaches to Development, Studies in Communication for Development. Paris: UNESCO, 2003.

Sheilds, Mureell G. E-Business and ERP: Rapid Implementation and Project Plannig. New Jersey: John Wiley and Sons Inc, 2001.

Svendsen, A. The Stakeholder Strategy: Profiting from Collaborative Business Relationships. San Francisco: Berrett-Kohehler Publishers, 1998.

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