“Priority is the function of context,” says Stephen Covey, author of The 7 Habits of Highly Effective People. This leads to the question: how do you position the value of change management in the right context, so it gets the priority it needs?
If your organization is in the ERP selection phase with an ERP implementation on the horizon, this is an important question to ask. In this post, we’ll explain how to communicate the benefits of change management. What is change management? It is the “people side” of change and it is a critical part of any enterprise software implementation.
How Does Your Organization View Change Management?
How is organizational change management viewed by project leaders? Is it seen as an optional add-on rather than a vital contributor to the project’s success? Does the conversation solely focus on change management activities, like communication and training, or does it focus on change management’s contribution to overall project results?
The key to promoting the concept of change management in ERP may be to not talk about change management at all – at least not at first. In fact, to position it as a priority, start with what senior leaders and project managers care about: achieving organizational benefits and ERP project objectives. An ERP consultant, like Panorama, can help you develop messaging that wins over the most resistant executives.
Change Management Case Study
The client recognized their need for more comprehensive change management, so they asked us to fill in the gaps. We developed a robust communication plan to supplement the vendor’s communication approach.
How to Communicate the Benefits of Change Management
With the following five questions, you can change the conversation from “What resources do we need for the change management process?” to “What resources do we need to capture the 50%, 80% or 100% of our project’s objectives that depend on people?”
Question 1: What is the ERP project trying to achieve?
This is a two-fold question and one that is easy to leave unasked. It is not just useful in outlining the benefits of change management, but it’s also critical for ERP project teams and leaders to understand, in general. After all, if they don’t know what the project is trying to achieve, how will they measure the effectiveness of the project?
More concrete answers to Question 1 can be reached by asking the next two questions.
Question 2: What are the organizational benefits of this project?
Organizational benefits are the higher-level reasons for implementing ERP software in the first place. These benefits could include increasing revenue, achieving compliance with regulations or strengthening customer satisfaction.
Question 3: What are the specific objectives of this project?
Specific objectives are the outcomes the project will produce. These are usually specific and measurable outcomes that ultimately lead to achievement of the organizational benefits. Examples of project objectives are: “All users tracking their sales leads in the new CRM system,” or “Customer response time shortened from three to two days.”
Once you’ve defined the benefits and objectives of the project, you can move on to tying those objectives to people. There are two elements to achieving each project objective and organizational benefit. One part of achieving the benefit is the technical solution: configuring the software, implementing a new ERP system, etc.
The other part of achieving ERP business benefits is the people side: the individuals impacted by the project in that they are having to change how they do their work. A combination of these elements (the technical side and the people side) is required to achieve the project objectives and organizational benefits.
So, how do you figure out how people-dependent these benefits and objectives are? We recommend looking at each benefit and objective and asking the next two questions.
Question 4: Which portion of this benefit depends on adoption and usage?
Some projects have very low dependency on end-user adoption and usage because the change is primarily technical in nature, like increasing server storage, for example.
On the other hand, many projects have a high level of dependency on end-user adoption and usage. For example, “streamlined communication” will depend highly on the people who need to adopt the new practices and do their job differently.
This is where scoping the change comes into play. Scoping serves to determine what level of organizational change management is necessary and helps you prioritize change management tools and resources that will be required to meet the project benefits and goals.
Most ERP projects require some amount of change management so it’s important to verify that your ERP implementation consultant offers change management as one of their ERP services.
Question 5: What percentage of this benefit will we achieve if no one changes how they do their job?
This question is what is called the “null hypothesis,” and it allows you to fully understand just how people-dependent your project’s objectives are.
Depending on how people-dependent your project is, you might get little to no benefit from the project if no one adopts and uses the ERP solution. For your strictly technical benefits and objectives, you might achieve between 80% and 100% of a given benefit. However, for most of your benefits and objectives, you’re likely to only capture a very small portion (between 0% and 20%) if no one changes how they do their jobs. This could constitute ERP failure.
In reality, it’s unlikely that no one will change their behavior at all. However, by asking the question, “What if no one changes?” you can capture the importance of change management. This also gives a baseline for measuring how much you eventually increase the achievement of people-dependent benefits.
By answering these questions, you’ll emphasize how much of ERP implementation success is reliant on people changing how they do their work. Without even mentioning change management, you can help your organization realize that to achieve expected benefits, they must drive adoption and usage.
Request a free consultation below to discuss what usage and adoption means for your ERP implementation and how you can increase it.