The year 2021 brought economic recovery, and with it, an increased confidence among organizations when it came to spending money on IT.
This is one of many findings from our 2022 ERP Report. The report is based on survey responses from organizations across industries, organization sizes, and geographic locations.
While our report found a strong interest in digital initiatives like business intelligence and mobility, it also found that organizations are not setting ambitious goals to accompany these initiatives.
The key reason? We believe it has a lot to do with whether or not organizations used consultant guidance.
Setting ambitious (and specific) goals can be difficult if you don’t hire use ERP consulting services and instead do an in-house implementation of ERP.
Continue reading for an overview of our report findings and a deep dive into data highlighting the dangers of in-house ERP projects.
The 2022 ERP Report
This report summarizes our independent research into organizations' selection and implementation decisions and their project results.
A Brief History of ERP
Enterprise resource planning (ERP) didn’t come around until the 1990s, but its foundation came about in the 1960s. Back then, it was known as inventory management and control.
In the 1960s, a greater focus on factory output began. To help increase production, computing solutions were created. During this time, software developers focused on creating applications to handle inventory management.
By the 1990s, these solutions evolved to handle all aspects of business, including accounting, human resources, customer relationship management, and more.
We now find ourselves in 2022 – a time where ERP software is not simply a means to automate processes but to create digital business models. This is known as digital business transformation.
Regardless of the type of project you’re pursuing, it’s important to seek third-party guidance.
4 Signs You Should Avoid an In-house Implementation of ERP
If any of these statements are true of your company, consider hiring outside experts to help you achieve your project goals:
1. Your Organization Lacks ERP Experience
Most organizations lack the expertise and experience to handle an ERP project. As a result, they face a huge learning curve.
In addition to the struggling to differentiate between the hundreds of ERP systems on the market, organizations often struggle to understand the variety of business benefits that their chosen enterprise software could bring.
As a result, they don’t orient their people, processes, and technology around critical goals, like gaining access to real-time data in their supply chain.
In fact, our report reveals that less than half of organizations hoped to gain access to real-time data. In other words, more than half failed to clearly define goals related to real-time data access.
2. You’re Too Close to the Project
An open mind and an outside perspective are essential if you want a system that can support the business you are today as well as the business you want to become.
If you only use an internal team for your project, you won’t get an outside perspective based on broad experience. In contrast, if you hire ERP implementation consultants, they will leverage lessons learned from numerous projects across a variety of industries.
As a result, they make no assumptions about the way your business should run. They also are not attached to the idea of doing things a particular way just because it’s the way things have always been done.
It’s important to hire a consultant to help you understand the “why” beyond each of your processes. This ensures that you submit the right requirements to ERP vendors, instead of asking them to automate inefficiencies.
Fortunately, most organizations in our study said they improved key business processes as part of their project. This is probably because so many respondents hired consultants for business process management guidance.
3. You’ve Never Implemented Artificial Intelligence or Business Intelligence
Many ERP implementations involve modern digital initiatives, like business intelligence (BI) and artificial intelligence (AI).
While BI was popular among respondents, AI wasn’t a reported focus area (in the present or future) for 15% of respondents.
The minimal interest in AI could be partially due to the fact that many of these organizations lack the infrastructure and business processes to support AI – and they don’t want to hire an ERP consulting firm to assist in the effort.
Regardless of what modern digital initiatives you’re implementing, consultant guidance is essential because most project teams lack breadth and depth of experience in advanced technologies.
4. You’re Expecting Strong Change Resistance
One of the most common reasons for budget overruns among respondents was organizational issues. Organizational issues encompass everything from resistance to change to process redesign challenges.
When it comes to resistance to change, one of the most powerful mitigation techniques is organizational change management.
However, many organizations are unfamiliar with all the components of change management, so they’ve struggled to minimize resistance in past projects and are worried that their next project will be déjà vu.
If you’re expecting strong change resistance and aren’t confident in your team’s ability to transition employees, then hiring a change management consultant is essential. These experts can help you understand the impacts of change for each employee group. Then, they can use this information to help you develop a targeted communication plan.
DIY Works for House Projects, not ERP Projects
Organizations have a tendency to minimize project costs and cut corners. If you’re wanting to be cost-conscious but don’t want to cut anything that’s essential, an ERP consultant can help you determine the right ways to save money in both the short and long term.
In addition, they can leverage their operational expertise to help you identify opportunities for improvement and design processes that enable you to take advantage of real-time data.
If you take away one piece of advice from our 2022 ERP Report, let it be this:
Dedicate time to strategic planning so you can set measurable goals, but before you do so, be sure to hire an experienced consulting firm to guide these strategic decisions.
This advice is especially important if you’re implementing business intelligence or artificial intelligence. Your real-time data will only be as useful as the strategy behind it.
Please download our 2022 ERP Report to learn more. In the meantime, you can request a free consultation below to learn about Panorama’s comprehensive suite of service offerings.