Effectiveness and efficiency are key within any organization. Those two things alone can be the reason to implement a new ERP system. But some organizations fail to realize all of the benefits that come along with reengineering their business processes.
Part of the problem lies with unrealistic expectations set by ERP vendors eager to sell their product. In other words: buy our software and it will tell you how to run your business. The problem is also caused by organizations that hear what they want to hear in the sales cycle (“our processes are broken and this shiny new software will help us adopt best practices”). Whatever the cause may be, most organizations fail miserably when it comes to making material improvements to their business processes.
Here are a few things to keep in mind to help ensure your business process reengineering efforts are successful during your ERP implementation:
- Start with realistic expectations. Unrealistic expectations during the evaluation, decision and purchase process is the root cause of many business process reengineering related issues. ERP vendors oversell the ability of their software to define customer business processes and implementing organizations don’t want to go through the pain of redefining their operations. This leaves both parties falling short of their abilities to make real It must be understood up front that changing business processes requires a good deal of time and effort. This way you will be well on your way to truly transforming your business rather than simply automating your broken processes.
- Invest time and resources in business process reengineering. I am always fascinated by the number of executives that say they want to transform their business processes, but fail to follow that desire with the appropriate levels of time, people, budget and focus. The most successful ERP implementations we see are those investing their resources and focusing their efforts and reengineering processes. It is rarely a pretty process – or an easy one, for that matter – but it always pays off. And not only does it pay off, but it arguably pays off as much or more than any other project activities that you may invest in.
- Don’t be constricted by your ERP software. Believe it or not, your new ERP system’s out-of-the-box functionality is likely to undermine your organization’s business capabilities. No that is not a typo: despite all the potential benefits of ERP systems, each has weaknesses that don’t help your business processes in certain areas – even if the software is the best-fit and makes your business better overall. The best ERP implementers know when to change their business processes to leverage best practices enabled by the software, but they are also smart enough to recognize when they should force the software to change in order to fit their business processes because those established operations are a source of competitive advantage.
- Business process reengineering is meaningless without organizational change management. Honestly, you may as well scrap your business process reengineering and ERP implementation efforts if you aren’t going to invest in organizational change management Without them, your envisioned “to be” processes are merely an academic exercise that will collect dust on a shelf. Organizational change management is critical to operationalizing those business process changes and ensuring that your employees are able to adapt to the new processes and systems. Also note that organizational change management goes well beyond end-user training (which most organizations tend to myopically focus on).
- You won’t achieve what you don’t measure. Ditto for measuring performance and adopting a benefits realization plan: your business process reengineering efforts are meaningless without them. Defining appropriate performance measures, setting targets and measuring post go-live results are paramount to ensuring that your new business processes deliver the business benefits you expect. By building these into your overall ERP implementation plan, you will be a step ahead of the game.
Most companies gloss over business process reengineering efforts and spend too much time on the technical aspects of their ERP implementations, but you can ensure success throughout your implementation by focusing more on the people and process aspects of your organization.
Register for our webinar, Business Process Reengineering: A Key Component of ERP ROI, to learn how to achieve a return on your investment through business process reengineering.