Has fear of failure held your company captive to its antiquated ERP system?
The fear of implementing a new ERP system is common and often controls a company’s willingness to consider updating its ERP software. It appears that their are many ERP implementation projects that exceed budget, suffer from delays, and can even be implemented incorrectly. However, there are also many implementation projects that go well, and are successful. The saying, “No news is good news,” can be applied to these successful implementations. Consider how seldom our news media reports on positive outcomes. The majority of newsworthy coverage is typically negative and often times reports problems or failures. So, why should we expect anything different from business reports. Typically, there is also someone within the organization that was involved in an implementation that they deemed unsuccessful. It just seems to be the nature of discussions around software implementation.
There are ways to protect your company from becoming one of those newsworthy, unsuccessful implementations, and release your company from ERP captivity. Paul J.N. Roy and Paul A. Chandler name several reasons for ERP Implementation failures in their article, “Contracting for ERP Implementation Success”.
Here are suggestions, based on Roy and Chandler’s findings, that can prevent ERP implementation failure:
1. Prepare. Be clear about what your company wants to achieve by implementing a new ERP system. Take the time to determine what functionality is necessary for your company, what functionality you would need to achieve the company’s long-term goals, and what functionality would simply be nice to have, but not necessary. Many implementations have gone awry by not aligning the ERP purchase process with the company’s long-term goals, and what is needed to accomplish them.
2. Have a plan. Taking the time to plan an implementation is key. This is where you want to work closely with your implementation team. Implementation teams have (hopefully) gone through many implementations and can assist in creating a realistic timeline and budget for the project. Many companies will try to self implement in order to reduce the cost of the project. This can be disastrous if the implementation team lacks the time and expertise required to implement software. Often, these types of implementations cost the company more to correct than if they had utilized professional implementation services.
3. Time allocation. Do not misjudge the amount of time that will be required of your managers, ERP implementation team, and various personnel. Implementation is a full time job. You are asking people within your organization to lend their expertise regarding the company’s processes to an implementation project. These are employees that already have full time positions within your company. ERP implementation will require some moving of responsibilities for a period of time, and the understanding that in addition to their current roles, some employees will be providing vital knowledge and work throughout the implementation process.
4. Identify. Determine what reports, interfaces, forms, and enhancements will change in your production and operations process. The point of ERP software is to provide a greater level of visibility into your business as well as streamlining and becoming more efficient. It is necessary to not be taken by surprise when certain interfaces and enhancements behave differently than what you are accustomed too. This is all in an effort to provide more in depth reporting and visibility.
5. Testing. Testing is a vital part of the process. Testing will assist in working out any final questions and helps to ensure that the production and operations process is running smoothly. Think of it as a trial period. It is the period of time where you are able to test and make any changes prior to your “go-live” date.
6. Invest in training. Training is another cost cutting measure that companies usually take that leads to confusion and overall dissatisfaction with the new software. Taking the time to create a training schedule and ensuring that all personnel are educated and ready for the new software will save the company lost time and money in the long run.
Utilizing these tips will help in understanding the complexity of an ERP implementation and how to avoid an ERP implementation disaster.
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