“Pushing for Transformation”: CIOs Share Best Practices for Making ERP Implementations Count

Two questions are commonly posed when a major IT initiative is pitched: when is the best time to start, and when will it end?

The answer to both is “never,” according to Zafar Chaudry, MD, Chief Digital & Information Officer with Seattle Children’s — especially when it comes to enterprise resource planning (ERP).

It must be approached properly, with the right stakeholders involved, and must be executed in a way that meets specific objectives, said Chaudry, who joined co-panelists Bradd Busick (CIO, MultiCare Health System) and Gretchen Tegethoff (Regional VP of Strategic Relationships, ELLKAY) during a panel discussion.

For Busick, whose team is currently migrating to Workday, the goal is to “fully transform business processes and workflows” — anything less is unacceptable. And while that may seem a bit drastic, he believes it’s the right approach, particularly given the sizable investment required to roll out ERP systems.

“Our rule of thumb when we kicked this off was if we get to the end of the tunnel and our recruiters are doing the same thing they were doing before, then we’ve failed,” noted Busick. “We’re pushing for transformation.”

And it’s a big push. MultiCare, an 11-hospital system based in the Pacific Northwest, recently announced plans to double in size in the next five years. Doing so with the current platform in place, leaders quickly decided, wasn’t possible. By migrating to Workday, they’ll be able to reduce the steps needed to hire and onboard staff, simplify processes, and “optimize the supply chain so that we have real-time data without lag,” he added. “We needed something that could scale.”

“A smooth experience”

Another key driver for implementing ERP is the ability to easily access data, said Chaudry, whose team is in the process of selecting a system. “When we look at staff recruitment and retention, and the needs for equity, diversity and inclusion initiatives, the information within our system just isn’t where it needs to be,” he said. “You need to have the right system to pull the right data and make the right decisions. You have to do this to make sure people have a smooth experience.”

It’s been a priority for Chaudry since he arrived at Seattle Children’s in 2017, focusing immediately on “modernizing the system.” First, he led a conversion from Cerner to Epic, much of which took place during the pandemic; then, after speaking with stakeholders from different parts of the business, ERP became the next focus. “They can’t use the current system in its current format to get the information that they need,” he said, recalling the many conversations that took place. “People want more self-service. They want to be able to slice and dice their data, and they can’t do that right now.”

Instead, users are forced to put in a request, and wait days – or even weeks – for an answer, which can become extremely frustrating, according to Tegethoff. If business leaders can’t access the data they need to run reports and make decisions, they’ll likely resort to workarounds. And eventually, “it might reach the point where that ERP is holding the organization back from getting the critical data they need to grow and to plan for the future.”

On the other hand, a modern ERP system enables users to “gather and report on data across the organization in a way that older systems might not be able to do because they tend to be more siloed,” she said. “Whether it’s HR or supply or finance, there’s a lot more that can be done in terms of reporting and analytics with the newer systems.”

From the top

A system, however, can’t provide this type of value without support from stakeholders across the organization. And to make that happen, CIOs and other leaders need to be prepared to “sell,” said Chaudry.

“If you’re about to embark on an enterprise-wide project, you have to find executives who will partner with you and stand tall with you,” he said, adding that “probably 20 percent of the job is sales.” It’s explaining why a change is necessary, drumming up support, and encouraging others to become engaged. “We’re not selling servers and storage. We’re selling solutions and we’re trying to convince people to join the party.”

As with many projects, especially one as complex as ERP, it’s extremely beneficial to partner with executive sponsors who can help drive operational changes, said Tegethoff, who advised teaming up with leaders in areas such as finance and HR. Having an executive sponsor on board can expedite approvals and help with change management, which is a critical piece.

“It’s a delicate balance,” she noted. “You’re investing in an ERP solution that’s meant to increase efficiency and reduce redundancy.” At the same time, “there’s a fear of losing processes that have been in place for a very long time. That’s a challenge.”

Keys to success

There’s certainly no shortage of hurdles when it comes to rolling out ERP, noted the panelists, who shared some of the best practices they’re using to overcome them.

• Don’t ignore workflow. “It doesn’t matter what system you put in; we need to fix our antiquated workflows as part of this process,” said Busick. It needs to be “a large transformational project, with the right levels of support to help the different departments look at how they do things in a different way.”
• Keep optimizing. One of the biggest mistakes organizations make, according to Chaudry, is failing to optimize after go-live. “You can put in a sexy ERP, but if you’re not measuring its utilization, and if you’re not constantly retraining your people and giving them access to self-service tools so they can really get into the data, you won’t drive value.”
• Check in. Similarly, leaders need to stay engaged with those using the system, and make sure their frustrations are being addressed. If this doesn’t happen and people are left waiting because they can’t access or leverage data, it could prove costly in terms of recruitment and retention, Chaudry said.
• Know the data. Before starting an ERP initiative, leaders need to have discussions around where the data reside, the processes around it, how it’s being utilized, and what needs to be migrated before moving to a new solution, noted Tegethoff, who spent several years as a health system CIO before joining ELLKAY in early 2021. “When you start to dig in and ask questions, you’ll be surprised at what comes from those conversations.”

The next discussion should focus on legacy data — specifically, which data should move to the new ERP system and which can live in an archive, such as the one offered by ELLKAY. These data, she added, are still available for various purposes such as compliance and audit.

At Seattle Children’s, Chaudry relies heavily on subject matter experts to decipher how much data are needed and for how long. One thing, however, is clear across the board. “You don’t want to take data from a proprietary system and put it into another proprietary system,” he said. When the organization migrated to Epic, only the last 18 months’ worth of Cerner data was moved, with the rest sent to ELLKAY’s cloud-based archive, which was customized to meet physicians’ needs. Chaudry plans to do the same with the ERP system, for which a vendor hasn’t yet been selected. Rather than storing data in a new system, he plans to move the most recent data into ELLKAY’s archive, and then “build a view and context-enable it with the interface to the system that we choose.”

Finally, when it comes to the selection process, Busick urged listeners to involve thought leaders from other departments when going to market. Doing so, he noted, encourages those leaders to take ownership and earn quick wins such as identifying obsolete solutions and consolidating tools, which has been the case at MultiCare.

“This was driven by the business,” he said. “That, to me, has been a big win. We’re empowering the business to find those gains, rather than IT bringing those forward.”

To view the archive of this webinar — Developing a Go-Forward ERP Strategy — please click here.