Over the last several weeks, we’ve featured a series of blogs that outline a variety of governance structures that can enable successful ERP implementations. For instance, we explored how both core teams and executive steering committees, when leveraged appropriately, can help facilitate more effective and results-driven deployments.

A third important component of successful ERP implementations is the use of ERP consultants. Most organizations are too busy running their day-to-day operations to develop the internal competencies required to effectively manage a deployment without some sort of outside help. Because most organizations only implement new ERP systems every decade or so, internal resources typically haven’t developed the enterprise software expertise required for ERP success.

On the other hand, it doesn’t help matters that most ERP consultants are hacks responsible for the extremely high rate of ERP failures over the years. Sure, they are likely to have more relevant experience than internal teams but, as research and experience shows, many ERP consultants have developed some very bad and myopic habits that have tainted the results of ERP implementations on a whole. The good news is that good consultants – once you find them – are invaluable project governance mechanisms.

So if an organization doesn’t have internal skills and most outside consultants aren’t much better, then what is it supposed to do? Below are a few tips on how to navigate the fine line between the use of internal resources and external consultants:

Understand the entire scope of your ERP implementation before selecting an ERP consultant. Perhaps the biggest problem with ERP consultants in general is that they have a very limited view of the world. If you hire an SAP consultant, for example, that’s all they know – SAP technology. This is also true for consultants focused on Oracle, JD Edwards, Infor, Epicor or any other ERP software, by the way.  While technical and functional knowledge of your specific ERP system is important, and is certainly something Panorama provides, it is only one part of a successful implementation. Good ERP consultants also understand the nuances of project governance, project management, business process reengineering, organizational change management and the various other critical success factors required for an effective deployment. Unfortunately, most ERP consulting methodologies focus too much on configuring and developing the software rather than these more important business aspects of successful implementations. At Panorama, we baked key organizational change, business process reengineering and project governance best practices into PERFECT Path™, our proven and proprietary ERP implementation methodology, and supplement it with the best practices and competencies related to each of the ERP systems in the market.

Collective team knowledge, tools and methodologies are more important than individual consultant bios. Implementing organizations often make their fair share of mistakes as well, with the most common one being too myopically focused on individual consultant bios. While you certainly want to hire a team of individual consultants with relevant expertise, it is more important to evaluate the collective experience of the consulting team to ensure that you have the overall right skills. This is especially true since most individuals (myself included) don’t have each and every skill required to make a project succeed. In addition, and perhaps even more importantly, you’ll want to closely evaluate what tools and methodologies will be leveraged by the consulting team. Individuals will come and go over the course of a multi-month or multi-year ERP system initiative, so the tools and methodologies deployed by your selected consulting partner are the only sure things to stand the test of time. As an example, Panorama leverages the ERP implementation methodology and toolset mentioned above.

There’s a fine line between relying too much on internal expertise versus too much on external ERP consultants. While we love the short-term revenue we can generate from clients that decide to outsource an entire ERP implementation to us, these types of arrangements rarely succeed in the long-term. Instead, implementing organizations need to find the right balance between leveraging the expertise and skills that they don’t have in-house with ensuring the internal team is taking ownership of the project. For example, you shouldn’t rely on outside consultants to decide for you how you are going to run your business. They may provide useful recommendations based on their experience but only internal stakeholders can make the ultimate decisions on how the business will run going forward. There are a host of other examples of project activities that should only be handled by internal resources, which will help ensure you have the buy-in and ownership of whatever ERP software solution you develop for your organization.

At the end of the day, ERP consultants can provide a strong project governance framework that will make your ERP system initiative more successful. However, not all ERP consultants are created equal, so it is important to do your due diligence when searching for viable consulting firms to support your initiative.

Learn more by downloading our white paper, Guide to Choosing an ERP Implementation Partner.

Posts You May Like:

How to Avoid ERP Implementation Failure: 9 Tips

How to Avoid ERP Implementation Failure: 9 Tips

Enterprise resource planning (ERP) is used to manage and integrate functions like marketing, finance, human resources, and supply chain management. While ERP software is a transformative solution for many business owners, others are too concerned about project failure...