When you finally decide to get a new ERP system, you probably have the best expectations. You think that this new ERP software is going to solve any problems your organization is facing. However, sometimes those expectations can be misaligned and, unfortunately, that is one of the greatest causes of ERP failures. It leads to unrealistically high hopes early in a planning process, and then to frustration later in the ERP implementation process.
According to Panorama’s 2016 ERP Report, most companies struggle with setting the right ERP implementation timeline. Fifty-seven-percent of organizations take longer than expected to implement their ERP systems – largely because they had unrealistic expectations in the first place.
So what do you do? While you don’t want to invest all of this money into new ERP software with the expectation that it will take too long and cost too much, but you also want to be realistic. Here are a few tips to ensure you are able to plan and execute a realistic implementation duration as part of your planning process:
- Benchmark to other organizations. Most enterprise software initiatives take, on average, 21 months. This number has been fairly consistent over the last several years of our experience and resource, although that number is trending higher in the last year. By contrast, many ERP vendors may tell you that their system can be deployed in just a handful of months. However, their assumptions may not be realistic and their “perfect world” implementation scenario may not apply to your organization. With that in mind, it is important to benchmark to how much time other companies like yours invest in their initiatives.
- Don’t believe the hype. Sales hype can also lead to unrealistic expectations. For example, sales reps may point to SaaS, implementation accelerators, pre-configured best practices and other mechanisms intended to create the perception of a potentially fast implementation. However, it’s important to take these sales messages with a grain of salt because that’s exactly what they are: sales messages. Every project needs to invest time in changing business processes and people, which is by far the most time-consuming aspect of large-scale enterprise transformations.
- Adopt world-class project governance. Implementations often take longer than expected because the project team isn’t leveraging effective project controls or instituting the appropriate project governance. Having tight controls in place will ensure that customization requests, scope increases and other common pitfalls don’t cause your project timeline to slip off track. Make sure that you have clearly defined decision processes and criteria in place to guarantee that your team is able to analyze and approve any decisions that could potentially disrupt your planned timeframe.
- Understand the hidden pitfalls of time overruns. Most organizations and internal team members aren’t experts in ERP implementations. Because of this, they aren’t always able to recognize the things that can contribute to longer than expected time commitments. It is important to enlist independent and objective expertise that can smoke out unrealistic time expectations and assumptions. For example, most ERP vendors and system integrators don’t address topics like organizational change management, extensive business process reengineering, data conversation and other activities likely to consume a great deal of time, but it is important to factor these activities into your overall project implementation plan.
- Make sure your project implementation plan is comprehensive. If you are missing key activities such as those mentioned in #4 above, then you are less likely to be working from a realistic implementation plan. Ensure that your implementation plan includes all of the activities required for a complete ERP implementation and business transformation – not just those activities that your ERP vendor is proposing as part of their professional services solution.
As we all know, ERP is a hefty investment. It is both an exciting and trying time, but it will help to have the right people on your side. At Panorama, we have experience getting people to the finish line unscathed. Check out our Expert’s Guide to ERP Success.