Many organizations launch organizational change management programs that fail to fully transition employees into the desired future state. These organizations often focus on developing a communication plan while forgoing many other change management activities.
According to Panorama’s 2019 ERP Report, a communication plan is the most common change management activity respondents used for their ERP projects. While a communication plan is important, it’s not enough for most ERP implementations and business transformations.
2020 ERP Report
This report summarizes our independent research into organizations' selection and implementation decisions and their project results.
Signs of Change Management Failure
Change management failure takes many forms, but it is most apparent at the completion of an ERP project. At this point, you’re expecting to begin realizing business benefits, but instead you’re facing low employee morale, low user adoption and low productivity.
It’s important to identify the signs of change management failure sooner rather than later. Signs might include:
- The project manager does not understand the needs of the end-user.
- The change impacts people who aren’t aware of or involved in the project.
- Management or executives are resisting change.
Fortunately, there are many change management activities you can employ to mitigate these challenges. Following are five change management tips that incorporate some of the most overlooked change management activities.
5 Change Management Tips
1. Be Proactive and Start Early
Change management often fails when the project manager does not understand the needs of the end-user.
Before selecting ERP software, you should assemble a team to assess employees’ needs. We recommend conducting focus groups. These are useful for several reasons:
- During focus groups you can document employees’ pain points with the current system. Exposing these pain points can help you to convince executives to invest in new technology.
- Focus groups are effective in gaining employee buy-in. When communicating the reasons for change, you can use the insights from the focus groups to align your message with employees’ needs.
- Focus groups help you select a system that addresses employees’ pain points. This is important because when employees’ needs are fulfilled by a technology solution, they are likely to respond more positively to your change management efforts.
2. Start at the Top
The most effective change management strategies start at the top. This is because people model the behavior they see. If executives appear fearful of change, employees will fear it as well. Inconsistency erodes employees’ trust in leadership and increases change resistance.
For example, one of our ERP selection and implementation clients achieved strong executive buy-in, which they used to gain employee buy-in. The communication from management was consistently supportive of change and focused on a clear, unified message that employees easily understood.
3. Provide a Big Picture View
You have probably heard a manager ask why they need to move to a new system when the existing system is fine. Additionally, executives may regularly remind you that there’s no need to reinvent the wheel.
A big picture view is the best way to address executive and management concerns as they are typically big-picture thinkers.
What Executives Want to Know
- How the project will cut costs or mitigate risk.
- How the project will impact multiple departments.
- How the project will address the pain points of key stakeholders.
- How the goals of the project align with business objectives.
Executives like specifics, so be sure to provide details. What specific business benefits will the ERP implementation bring? Will it improve communication and integration between departments? Will it improve the company’s ability to serve customers? Quantify these benefits as accurately as you can.
For example, one of our process manufacturing clients wanted to improve the efficiency of their sales function. They demonstrated to executives how the new system would provide better insights into their customer service function, allowing them to automate many aspects of it. They showed how this would free up time for employees to focus more on outbound calls. This appeals to the executive’s desire for efficiency and increased revenue.
Our ERP consulting services include a benefits realization plan, which allows clients to track the realization of the benefits they’re using the promote the project. This provides further validation to employees that the benefits being promoted are on track to be achieved.
4. Customize Your Training
As ERP systems and CRM systems prove their worth across industries, many companies are happy to implement new technology without a thought. They are confident that their “tech-savvy” staff will quickly and painlessly learn the new system.
However, even truly tech-savvy employees don’t innately know how a new system operates. When you consider your less tech-savvy employees, a technological change seems hopeless.
The good news is that you have many resources available to educate your staff. In addition to the ERP vendor’s training materials, you can design customized training based on the new business processes in each department.
For example, it’s important to train your accounting department on their unique processes within the ERP system. Additionally, you should train your customer service reps on their functions and help them understand upstream and downstream processes.
What Does Change Management Success Look Like?
Whether you’re beginning an ERP implementation or a business transformation, change management requires more than communication. It requires a full change management plan that ensures executive support, employee buy-in, and most importantly, benefits realization. This is what change management success looks like.
Panorama’s ERP consultants can ensure your change management initiative is successful. We’ll help you plan for and execute all of the activities that companies tend to overlook.