Why You Should Not Plan ERP Go-Live for January Gwendolynn Massie Mon, 11/23/2020 - 05:58

You Don’t Have to Go Live with Your ERP on January 1! Here’s Why You Should Choose the Timing That’s Best for Your Company 

Everyone wants to go live with the ERP implementation on January 1, especially those making an ERP buying decision in the 4th quarter. It’s the norm. The standard. But have you ever wondered why? Does it truly make sense to go live on January 1? 

The short answer: Not necessarily. While there are specific reasons why a company might be required to go live on January 1, it is more often the case that companies have much more flexibility and might be held back by assumptions or simply doing things the way they’ve always been done. 

This blog discusses the reasons companies typically try to go live on January 1, why another date could be a much better choice, and the tools and processes available that will enable you to choose the go-live date that makes the most sense for your organization.

Why Companies Go Live on January 1 

It’s become a cliché. Get a new ERP system, set the go-live date for January 1. Is there something magical about that date? Not particularly. The main reason companies choose January 1 is financial; the finance/accounting department wants a clean close of the books for the year. They want to be sure all entries leading up to the go-live coincide with the current year and that moving forward, all new entries are in the new system and in the new year.

Another reason for going live on January 1 is one that the company might not have control over—the company has been acquired by another company that has mandated a January 1 go-live, or they have branched off from another company and need to be up and running by January 1, or they’re coordinating with another initiative, like launching an online store, for example. In those cases, there is no choice. 

One more reason for the January go-live decision: Legacy ERP and financial systems. Many of these systems had “buckets”—where data accumulates over months. At month-end, those buckets are dumped. Because the buckets are not date-sensitive, they can create reporting issues, which causes your financial folks to be hypervigilant about dumping them. Sometimes, however, they think those buckets need to be dumped simply because that’s the way things have always been done.

Why January 1 Is NOT Typically the Best Choice

Now that we’ve discussed why companies choose January 1, let’s talk about why they should reconsider—and what date(s) we recommend. In short, the problem is timing. With the holiday season literally butting up against January 1, companies immediately put themselves in a high-pressure situation. 

Many people take vacations during this period—a time when it should arguably be all hands on deck. There are the tasks involved with the implementation, including a mock go-live, testing, etc., and there is also training to be done for those who might not be involved in the technical part of the implementation but will be using the system, dealing with changed or new processes, etc. 

And those who aren’t on vacation physically are very likely to be somewhat checked out mentally. Let’s face it: We have shopping and cooking and family and…not to mention a sugar coma that kicked in around Thanksgiving. Seriously, this is not a time to count on people’s undivided attention.

Speaking of attention, let’s say you accomplished all the training before the holidays in preparation for going live when everyone is back in the office on January 1. The gap between training and go-live could be as much as 5 or 6 weeks. How much will people remember if they have not had the opportunity to work in the system? 

How to Select a Go-Live Date    

So, what is the best date for going live with your new or upgraded ERP? The answer depends entirely upon your company’s schedule, requirements, and processes. Consider these questions:

  1. At what time of year are the people who are involved with the implementation and/or using the system likely to be in the office? Remember that you need at least 5 weeks before going live to provide training on the new system.
  2. Is there seasonality to your business?
  3. Are there times when your accounting department is particularly busy?

Take into consideration what works best with your company’s natural rhythm, rather than imposing arbitrary deadlines that can cause everyone unnecessary pain and worry.

Also, do not let issues like getting data in before a certain date stand in your way. The next section will explain why.

Your Partner and The Right Tools Can Help

The most important thing to know is that your ERP implementation partner can help. In fact, a discussion with your partner about your go-live date should be on your list of topics to discuss. They can advise you based on your project scope and company schedule and requirements, and they should have tools that will help you handle things like bringing over ending balances and other tasks in whatever way and on whatever schedule works best for you to keep things on track with your financials and reporting. There is no hard and fast rule about month-end or year-end or any other end if the technology is there. For example, Microsoft Dynamics NAV and Business Central allow you to select specific date ranges, so you don’t have to deal with unyielding buckets.

ArcherPoint will discuss with our clients the importance of comparing data from the old system with the new. For example, we often use Power BI for that task, which is very effective for seeing both sets of numbers together in one dashboard for comparison.

There is nothing standing in the way of approaching an ERP go-live on your terms. There are many approaches, processes, and tools at your disposal; you just need to evaluate your business requirements and have an open discussion with your ERP partner. 

Are you considering an ERP purchase? Have you purchased an ERP but are struggling to get it up and running? Reach out to the ERP experts at ArcherPoint.

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