Nonprofit CFOs: Implementing a new ERP doesn’t have to mean burnout
- A new ERP can help your nonprofit operate more efficiently and wow your funders — if your team doesn’t burn out halfway through the implementation process.
- To successfully implement an ERP, embrace a structured process that includes a clear roadmap, a timeline, defined outcomes and enough people-power to actually get the job done.
- Practice effective change management throughout your implementation to win over key stakeholders and help your team understand why you’re putting a new system into place.
Many nonprofits still run on legacy accounting systems, which are cumbersome to navigate and built to solve yesterday’s problems. Small wonder nonprofit leaders are increasingly eager to transition to modern enterprise resource planning (ERP) platforms, which typically allow your organization to operate more efficiently (and impress funders).
However, fear of an exhausting implementation process leaves some nonprofits holding off on actually moving forward with a new ERP. Keep reading to learn how to avoid that — and make your implementation a success.
Why do so many nonprofits struggle with an ERP implementation?
Nonprofits typically struggle with an ERP implementation due to a lack of resources, knowledge or understanding. Key roadblocks include:
- Limited bandwidth: Implementing a new ERP can genuinely transform how your organization operates, but getting there takes a lot of work. There’s never a perfect time to do it, and your team will have to make room for the process while still navigating their everyday responsibilities.
- Lack of organizational knowledge: Your legacy accounting and operational systems may have been set up a generation ago, which means the details of how everything fits together might exist only in the mind of one or two crucial team members. If you go into an ERP implementation without fully understanding the systems and processes you’re trying to replace, you might break things you don’t know how to fix.
- Poor technical knowledge: To make the most of a new ERP system, your nonprofit will need enough technical knowledge to not only install it, but also integrate it deeply into your everyday processes. Here, you’ll need to know how to study, analyze and report on large amounts of data and bring subject matter expertise to how an implementation will affect your area of work.
- No clear why: If your team doesn’t know why you’re implementing a new ERP, it will be tough for anyone to find the motivation, energy and bandwidth to actually follow through with doing it.
But how do you actually overcome these types of roadblocks? It starts with a clear, effective implementation process.
What are the key steps for a successful ERP implementation?
Embracing a thoughtful, structured process will make your nonprofit’s ERP implementation smoother and more successful. Working with a third-party advisor that understands both enterprise systems and the unique needs of nonprofit organizations can also lighten the load for your team.
Here are seven action steps to drive your ERP implementation process forward:
1. Dedicate enough resources
Give your team enough time to actually get the job done. Implementing a new ERP takes a large number of people-hours, so budget for that going in, rather than assuming you can fit it into your existing schedule with minimal changes.
2. Spread the work around
Don’t expect your CFO or controller to tackle an implementation single-handed. While you do want an executive-level leader to champion the process, this person needs support and a team behind them to actually get the job done — or you’ll quickly be dealing with burnout.
3. Follow a defined roadmap
Before you actually start, create a roadmap that lays out each step of the implementation process. This will include choosing the right ERP, mapping out how to replace existing systems and rolling out the new software over time.
4. Set clear outcomes
What future state and outcomes are you trying to achieve? Establish clear KPIs to define what a successful implementation process looks like, so you have a north star to work towards.
5. Appoint a dedicated project manager or point person
Even if you work with an advisor to speed up your implementation, you still need someone within your organization to handle the day-to-day details. Choose someone on your team to serve as a project manager and then don’t bog them down with so many other duties that they don’t have time to actually manage the project.
6. Establish a timeline
Most people and organizations work better with a deadline. To give your implementation a healthy sense of urgency, set a clear timeline for when you’ll start and finish. The exact amount of time you’ll need depends on the size and complexity of your organization, but you can look at four to six months as a rough ballpark figure.
7. Embrace testing and training
The more your team can learn and test the new systems during the implementation phase, the better you’ll be able to hit the ground running after your go-live date. Otherwise, you’ll still be getting people up to speed even after your old systems are no longer functioning and you’ve got constituents who are counting on your help.
Practice effective change management throughout your ERP implementation process
CFOs or other nonprofit leaders kicking off a new ERP implementation will need to consider the change management piece, too. Don’t expect your team to embrace a new ERP overnight.
Get input from all of your key stakeholders as early as you can. People need to feel heard, especially when a major change is about to happen. Some will be skeptical, but if you can get their input upfront, you make it easier for your stakeholders to become change champions rather than detractors.
However, you can’t always wait for consensus either. Find the right balance between welcoming feedback and driving the project forward. If you always delay till everyone is happy, nothing will get done.
To keep your team in the loop, hold weekly status calls with your stakeholders. You also want to update the rest of your team regularly through emails, Q&A sessions and other touchpoints.
Remember, if your whole team understands why you’re doing this, you’re much more likely to succeed.
How Wipfli can help
We advise nonprofit organizations on technology, performance, financial resilience and growth. Let’s talk about how tools like a new ERP system can help your organization boost impact, operate more efficiently and impress your funders. Start a conversation.
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