Enterprise Resource Planning (ERP), the most happening software, has been implemented widely across all the industries. Wide range of ERP implementations are going on because of competitive pressures, to improve the ROI and to adopt the available best practices in the market. ERP integrates all the functional departments across the company to ensure the smooth flow of information and communication between all departments.
GAP analysis plays a key role in the implementation process of Enterprise Resource Planning. GAP analysis is one of the finest methods available in the market to compare the company's current performance against the potential performance. GAP analysis is considered as a baseline for the customization of the enterprise resource planning application. ERP is readymade software which is designed to serve all the industries. As operation process of one company differs from the other company, enterprise resource planning application needs to be customized from the case to case basis. The customization of ERP will be done based on the GAP analysis.
To put in technical terms, GAP analysis shows the thin difference line or the gap between the present operations capabilities and the potential operational capabilities of the company. The ultimate aim of the ERP implementation is to bridge this thin difference line or the gap.
In the first step, the vendor will analyze the current business environment of the customer. In this process, they analyze core competencies, the most prioritized functional departments and the pain areas of the customer. Then, they will think about the application customization to ensure the all core competencies, prioritized areas, and mainly the pain areas are perfectly addressed. Let us say, a production organization is more concerned about the scheduling, order tracking and timely delivery of the product. A sales organization will concentrate more on the sales and order entry part. In the former case, the core area of the company is production. So, in the GAP analysis, considering the present production as a base, the vendor put a benchmark, which needs to be achieved with the help of ERP implementation.
GAP analysis is a thorough report on the customers' working environment. The whole implementation process will be taken place based on the GAP analysis report. To achieve these benchmarks, the vendor will customize the ERP application, if required.
The GAP analysis gives clear picture on how much customization is required for the enterprise resource planning application to run the business smoothly. The same GAP analysis report will be handed over to the technical people at the vendor side to finish the customization part. They will add some more tabs in the ERP application depend on the customer requirement as shown in the GAP analysis.
To put in a nutshell, GAP analysis is the most important aspect in the ERP implementation and without GAP analysis, it is not possible to address the pain areas of the company. This is the reason why, GAP analysis is given the highest priority in the implementation process.
