ERP/MRP II Development & Implementation Guide (Volumes I – IV)


  • Volume I – Planning, Organizing, Implementing
  • Volume 2 – Appendices
  • Volume 3 – Project Control Plan
  • Volume 4 – Policies and Procedures

Volume I – Planning, Organizing, Implementing

Enterprise Resource Planning (ERP) evolved from the more elementary Material Requirements Planning systems. ERP encompasses business planning, sales planning, forecasting, production planning, master scheduling, material planning, shop floor control, purchasing and financial planning, routing and bill of material management, inventory control and other functions. It carries the manufacturer through the complete cycle from determining needs and capabilities to cost accounting. ERP then matches the necessary components to the real needs in a timely fashion.

The implementation of ERP systems is a complex and lengthy process. This Handbook was conceived as a tool to reduce a manufacturer’s burden and risks during the planning and implementation process.

This Handbook provides detailed recommendation for planning, implementing and operating ERP systems. The following sections are covered in Volume I.

This Handbook serves as a resource and reference tool in several situations and stages of ERP design and implementation. A few of these uses are introduced below.

  • The Handbook provides a training manual for ERP implementors. The detailed and methodical approach enables it to serve as a useful text for internal training classes as well as informal self-study.
  • While working with management during the initial idea stage, the Handbook provides a springboard for discussion and helps them gain a realistic sense of the magnitude of the project. Management often do not fully realize the scope of the commitment involved and the Handbook provides concrete guidelines and examples to direct them in planning and decision making.
  • During the project itself, the Handbook documents hundreds of required steps toward completion of the project. It can be used as a best practice reference to ensure completeness and accuracy at all stages of development and implementation.
  • The Handbook provides a detailed, structured approach to problem detection and solution through the use of diagnostic questionnaires. These questionnaires enable consultants and managers to resolve difficulties efficiently and before they become unmanageable.

In short, effective use of this Handbook assists consultants (internal/external) in providing consistently high quality services to manufacturing companies by providing detailed guidelines to designing, implementing and operating ERP systems.

The Handbook, and specifically the project plan, should be used as reference material to ensure that the consultant has considered the various elements necessary for a successful ERP implementation. Under no circumstances should a consultant merely copy the material “as is” and consider it a final work product. Tailoring will always be necessary and should be accomplished by considering the project director’s experience and project control techniques, the nature of the systems to be implemented, and the stage of the client’s development.

1. Introduction to ERP

  • Purpose of Handbook
  • Executive Summary
  • ERP Systems Project Management
  • Implementation Requirements
  • Planning Charts and Graphs

2. Definition of Business Conditions

  • Degree of Change Required/Allowed
  • Review of Status Quo
  • Business Factors for Consideration

3. Commitment, Funding and Progress Reporting

  • Executive Committee Updates
  • Management Group Presentations
  • Communications (Internal and External)
  • Monthly Milestone Updates
  • Steering Committee Meeting Minutes

4. Project Plan

  • Project Scope and Timetable
  • Project Milestones
  • Project Control Plan
  • Project Charter
  • Project Implementation Plan
  • Project Management
  • Project Management Procedures

5. Project Justification and Performance Measurement

  • Major Areas to Consider
  • Financial Analysis
  • Measuring Financial Success

6. System Functional Specification

  • Definition
  • Review
  • Acceptance

7. Software Evaluation and Selection

  • Selection Criteria
  • Selection Factors
  • MRP Software Review

8. System Detail Specification

  • Definition
  • Review
  • Acceptance

9. Resolution of Conflicts

  • Standard Software Restrictions
  • Standard Software Limitations
  • Functional and Detail Specifications Review

10. Key Committees to Organize

  • Steering Committee
  • Project Leader
  • Project Team
  • Manufacturing Task Force
  • Engineering Task Force
  • Engineering Change Notice Committee
  • Product Definition Change Committee
  • Bill of Material Structuring Committee
  • Product Definition Committee
  • Material Control Task Force
  • Shop Floor/Cost Control Task Force
  • Finance/Marketing Task Force
  • Data Processing Task Force

11. Organization and Job Descriptions

  • Functions, Responsibilities, and Objectives
  • New Departments and Functions
  • Personnel Department’s Role in Organization
  • Materials’ Organization Chart
  • Job Responsibilities/Descriptions

12. Policies, Procedures, and Documentation

  • Engineering Release Procedures
  • Engineering Change Notice Procedure
  • Product Definition Change Procedure
  • MIS Request Procedure
  • Software Problem Notification
  • Systems Specification Change Procedure
  • Production Plan/Master Schedule Changes
  • User Manuals

13. Education and Training

  • Objectives
  • Education Plan
  • Education and Training Methods
  • Testing
  • Organization and Participation

14. Conference Room Pilot

  • The Standard Software Installation
  • Standard Test Data Base
  • Data Entry Forms Design
  • Standard System Training
  • Test Documentation
  • Test Runs (Input and Output)

15. Product Pilot

  • Standard Test Data
  • Sign-off and Warranty
  • Outside Support
  • Test Results and Procedures
  • Data Base Loading Techniques
  • Installation Schedule
  • Pilot Site – Multiplant

16. Full System Cutover

  • Priority List – Final Items
  • File Conversion
  • Detailed Plan – Weekend Cutover
  • Final Conversion Meetings
  • Existing File Data (What to Save)
  • Step-by-Step Cutover Procedures

17. Procedure Manuals

  • Who Should Write Them
  • Contents
  • User Reference Manual
  • System Reference Manual
  • Format
  • When and How to Prepare
  • Input Forms and CRT Displays
  • Output Reports and CRT Displays
  • Data Control
  • Data Element Responsibility
  • Specific Manuals
  • Suggested Operating Procedures

18. Departmental Data Responsibilities

  • Systems Impact by Data Element
  • Departmental Impact on Systems

19. Consulting Services

  • The Consultant’s Function and Role
  • The Inside Consultant
  • The Hardware/Software Consultant
  • Guidance in Software Selection
  • Implementing Guidance and Involvement
  • Problem Area Review
  • Challenge, Change and Modification
  • Vendor Supported Standard Test Data
  • Software Selection Expertise
  • Resolving Software Errors
  • Working with User Departments
  • Vendor Software Modifications
  • Consultant Reports

20. ERP Effectiveness Evaluation

  • Area Effectiveness
  • Information (Input, Output, Database)

Graphs and statistical reports

  • Performance measurements
  • Warning signals
  • Auditing the system


  • Initial ERP Library
  • APICS Bibliography


Volume II – Appendices

In this volume we provide examples of deliverables from specific projects. The following elements are presented:

  • Company Survey
  • Business Factors
  • Milestone Agenda Review
  • Project Communication Memo
  • Project Newsletter
  • President’s Letter
  • Supplier Letter
  • Client Company Samples
  • Project Milestones
  • Project Milestones Review – Minutes
  • Project Charter
  • Project Control Tasks
  • Project Task – Production Planning
  • Project Plan Forms
  • Cost/Benefit Analysis
  • Project Interview
  • System Functional Specification
  • Manufacturing Systems Functional Specification
  • ERP/MRP II Standard System
  • Meeting Agenda and Minutes
  • Company Organization
  • Position Descriptions
  • Position Description Form
  • Policies and Procedures
  • Policies and Procedures – Recommendations
  • Software Revision Procedures
  • Education Matrix
  • Education Curriculum
  • Plan Visit
  • Education Monitors
  • Project Team Questionnaire
  • Education – A Luxury or Necessity
  • Training Workshops
  • Training Workshop Matrix
  • Data Gathering
  • Conference Room and Product Pilot
  • Database File Conversion
  • Full System Cutover
  • Data Element Responsibility
  • Shop Calendar
  • Selecting ERP/MRP II Consultants
  • Consultant’s Report – Sample
  • Consultant’s Report – Format
  • Client Evaluation Notes
  • Project Report Book
  • Transaction Worksheet
  • ERP Effectiveness Evaluation
  • Performance Measurements
  • Graphic Indicators of Operations
  • ERP Effectiveness Evaluation Questionnaire
  • ERP Effectiveness Evaluation
  • Corrective Actions
  • Managing Conflict Between Mission and Resource

Volume III – Project Control Plan

Project Planning is thinking about the future and then deciding on a realistic method to accomplish goals. No one can predict the future with any degree of accuracy, but experience has shown that it is better to prepare with an idea of what is going to happen than with no preparation at all. Planning, imperfect as it may be, is the only way the ERP Project can be implemented on time and within budget. An aggressive, but attainable, plan is the chart that allows the project to navigate the troubled waters of the manufacturing environment without sinking.

The project plan is only one small element of the entire implementation of an ERP system. However, the project plan must identify all of the tasks to be completed in order to ensure the successful implementation of a Enterprise Resource Planning System. The beginning of the project is generally identified as the point when one or more individuals at a relatively high management level recognize the need to perform a Justification Analysis to determine the anticipated costs and potential benefits of the implementation of such a system. Once this analysis is started, the beginning phase of the overall project plan has commenced. This plan must encompass all activities through and including a post-implementation audit of the complete system to ensure it has met its objectives. This could include as many as 20-25 major tasks with 200-350 subtasks, all of which compose the project plan.

The Table of Contents in Volume III is as follows:

Table of Contents

  • Forward
  • Project Milestones
  • Project Plan Schedules
  • Project Plan Tasks
    • Organization and Control
    • Commitment and Justification
    • Education
    • Organization and Activity
    • Software/Hardware Review and Selection
    • Operation Information
    • Documentation and Communication
    • Conference Room Pilot and Training
    • Product Pilot and Full System Cutover
    • ERP Effectiveness Evaluation
  • Blank Project Forms

Volume IV – Policies and Procedures

Volume IV, Policies and Procedures, is a policy and procedure manual documenting over 150 policies and procedures which are required for implementing and operating a Class “A” ERP system. Volume IV is divided into four sections: Foundation Disciplines, Modules of ERP, ERP Project, and Responsibility Index.

The section on Foundation Disciplines discusses the ERP database and the required procedures to support the maintenance and updating activity with respect to key data elements such as inventory, bill of material structures, routings and open orders. Section 2, The Modules of ERP, documents those policies and procedures required to operate an ERP system on an ongoing basis. It documents the functions with respect to sales forecasting, material requirements planning, purchasing, etc. including the measurements which will be put in place to ensure a successful Class “A” ERP operation. Section 3 discusses the policies and procedures which are required during the implementation phase with respect to areas such as education, documentation and the project control plan. The fourth and final section, responsibility index, will cross-reference all of the policies and procedures to the respective departments that would need to use some or all of those procedures in their daily operations. These departments would include such areas as finance, materials management, and the ERP project team.

Although each document is referred to as a procedure, the documents truly represent a combination of policies, procedures and documentation. This policy and procedure manual is a part of the total documentation for an ERP system. Documentation also includes user reference manuals received from the hardware and software vendors, as well as corporate policy manuals. Documentation in general covers areas such as flow charting, input forms, sample output reports, step-by-step procedures for completing a specific input transaction, user manuals, etc.

The following policies and procedures are illustrated: Table of Contents

  • Foundation Disciplines
    • Database
    • Item Master Data
    • Bill of Material
    • Inventory
    • Routing
    • Work Centre
    • Manufacturing Order
    • Purchase Order
    • Customer Order
  • Modules of ERP
    • Business Planning
    • Sales Forecasting
    • Production Planning
    • Master Production Scheduling
    • Material Requirements Planning
    • Capacity Requirements Planning
    • Shop Floor Control
    • Purchasing
    • Financial Planning
  • ERP Project
    • Education
    • Training
    • Software System
    • Conference Room Pilot
    • Product Pilot
    • Full System Cutover
    • Documentation
    • Project Control Plan
  • Responsibility Index