ERP Application Management: Important Steps in Mitigating Risk

ERP Application Management

Important Steps in Mitigating Risk

http://www.oneneck.com


• Risks is described as countless potential failure point that exist throughout an ERP project

• Risks surface from problems in technology, staff nature and more

• Project managers can break down risk avoidance into five steps



Step 1: Identify Potential Points of Failure• An experienced project team is best defense

against risk• Well qualified IT outsourcing firms offer the

highest levels of expertise and experience• Examples of point of failures: cost estimates,

unqualified project managers and lack of clear objectives for ERP application management project



Step 2: Assess the Potential Damage• After identifying point of failure, team must

assess the likely damage:• What will happen to budget, schedule or users’

requirements?• What will the impact be at micro or macro level?• How severe will damage be and who are

affected?



Step 3: Determine the Probability of Failure• Assess the probability that failure will actually occur• Project team needs in-depth expertise in ERP

application as well as company’s business• Working with IT outsourcing company, businesses

have opportunity to get expertise they may not have in-house, as well as experience implementing package within similar sized company in same industry



Step 4: Prioritize the Risks• Team can decide what risks they’ll focus on

eliminating due to detrimental effect on business

• Project team makes executive management aware of priority risks

• Monitoring plan should be in place for project team to oversee all identified and less important risks



Step 5: Mitigate the Risks• Team needs appropriate action to mitigate all risks• Goal is eliminate all risks as much as possible• Mitigation involves reducing risk’s probability or

impact• Team needs to address both risk probability and

impact in application management plan• Plan should identify actions needed to reduce risk

and steps required to recover


About the Author

• Chuck Vermillion is CEO and founder of OneNeck IT Services, a leading provider of hosted application management and managed services since 1997. For more information about ERP Application Management, visit http://www.oneneck.com/Solutions.aspx today.


http://www.oneneck.com/Solutions.aspx

ERP Application Management: Important Steps in Mitigating Risk

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