Through the treacherous years of manual processes, outdated legacy systems, inaccurate performance data and internal operational breakdowns, most organizations are ready for a heavy dose of business process reengineering.
Everyone has different opinions of what business process reengineering actually means and what its correlation is to ERP implementations. Our team has found seven common myths about business process reengineering that we will share along with a healthy dose of reality check:
Myth 1: Business process reengineering doesn’t need to happen during ERP projects. This is perhaps the most misguided of all the myths mentioned. Every ERP system – regardless of which you choose – will most likely wreak some sort of havoc on your business processes. Most of these changes will be positive improvements but will still require some effort in defining your operations in the new system environment.
Myth 2: Simply implementing a new ERP system will drive process improvements. This may take the cake for the most pervasive myth in the industry regarding business process reengineering. Today’s ERP systems are extremely robust and flexible, meaning even the simplest business processes can be performed multiple ways. Organizations need to defined their business processes so the software can be configured and customized accordingly.
Myth 3: ERP project teams should focus on “to-be” rather than “as-is” processes. If you are an ERP vendor or sales rep, current-state processes probably don’t affect your dad-to-day. But if you are the organization making the changes or the employees doing the work every day, then the current processes absolutely do matter. It is critical that you assess the current state of your processes to help you define the future state as part of your business process reengineering and optimization efforts.
Myth 4: Business process improvements can be done without organizational change management. Many executives think that they can simply redefine and implement business processes without organizational change management. However, this is a very misguided view of how to enable process and system changes. The most effective business process reengineering efforts succeed largely because of the way change management is addressed – not because of how well the processes are defined on paper.
Myth 5: You can’t reengineer business processes before knowing which software you are going to implement. Obviously, screen transactions and menu options are driven by specific ERP software, but the how, what and when of what your business actually does is mostly independent of your software. Sure, your new ERP system may provide some new and better ways of carrying out the detailed transactions, but the general nature of your business operations probably won’t change much. For this reason, it is typically more advantageous and efficient to both evaluate and improve your business processes prior to selecting and implementing a new system.
Myth 6: All business processes need to be overhauled before selecting and implementing a new ERP system. In opposition to myth #5, some executives believe that they need to evaluate, redesign and reengineer their entire business prior to selecting and implementing a new ERP system. However, this is not the case. Typically, the most successful organizations focus on improving their core areas of competitive advantage or differentiation as part of their ERP implementations, while letting non-core business processes follow the lead of the software’s out-of-the-box functionality.
Myth 7: Business process reengineering will cause my ERP system to take more time and money to implement. The Achilles heel of many failed ERP implementations is that they assume that “doing things right” will cost more time and money than if they cut some corners along the way. While it may look good on paper to strip out any extensive business process work, the reality is that your project will most likely take longer to implement and fail at go-live if business processes are not adequately addressed as part of your implementation. Remember it is much less expensive to do things right the first time than to clean up after an ERP failure.
If you have hopes of a successful ERP implementation—and let’s face it, everyone does—be sure to keep a realistic view in mind and don’t cut corners. And, as always, beware of the seven deadly myths.