An ERP implementation is an incredibly expensive, complicated and risky proposition. As Panorama has seen (and detailed) over the past several years, failed implementations can even drive companies into bankruptcy (e.g., Shane Co., American LaFrance, FoxMeyer Corp., etc.). So what are the “dirty” secrets of avoiding bankruptcy from an ERP failure? How can companies avoid the catastrophic loss of income, loss of sales, disruption of shipments or miscalculation of inventory that can lead to such disastrous circumstances?
Following are three secrets to achieving ERP success (and limiting your risk of failure – in any form):
1. Blueprint your requirements and THEN choose ERP software. Don’t choose an enterprise solution based on anything but what your company requires and how it works. Yes, SAP and Oracle are amazing systems but if they’re not a good fit for your organization, you’re going to have trouble.
2. Put your operations people in charge – not your IT people. Though ERP is often seen as an IT initiative, it is a business initiative. Its success or failure will affect every aspect of your business – so don’t put all the responsibility on your IT people. It’s their job to make the ERP system work; it’s not their job to make sure it reaps any ROI.
3. Stop pretending that organizational change management doesn’t matter. It does, much more than you might suspect. If your executives or end-users (or both) aren’t on the same page, don’t have the same clear vision and don’t have any tactics to use to achieve that vision, then your ERP implementation will probably fail. Invest the time and the resources to properly managing organizational change and you’ll drastically increase your chances of success. It really can be that simple.
These might seem a bit blunt, but after a year of having “ERP failure” as one of my Google alerts, I’m getting a little cranky about the propensity of organizations to mismanage these implementations. It’s not simple, don’t get me wrong, but managing it correctly starts with knowing what you want and what you need, what your staff wants and what it needs, and who you’re going to put in charge to make it happen.
At Panorama, we have developed methodologies to decrease risk – and increase business benefit realization – at every stage of an ERP project. It’s what we call our 360-degree approach, and it’s what’s needed to move forward with confidence. Learn more by checking out our ERP Services page or call us at 720-515-1377 to discuss your needs (and wants) in more detail.