A commonly known success factor for ERP implementations is executive buy-in and support, which should be a key component of an effective ERP organizational change management plan. But what does this really mean?
Our firm is often called upon to clean up failed implementations, and a root cause for many of the issues that lead to failures is related to lack of executive support. In addition, our 2008 ERP Report finds that effective executive support is a key differentiator between successful, best-in-class implementations and failed projects that cost too much, take too long, and/or deliver few benefits.
Our experience shows that there are four dimensions required for effective executive buy-in:
1. Support for the ERP project. In its simplest form, executive buy-in should entail support for the project. This goes beyond approving the project and writing the checks; it also entails supporting ERP as a business transformation initiative rather than a technology or software project.
2. Involvement in software implementation decisions. Executives often think that a hands-off approach is appropriate once the project has been approved. However, this is not the case. Given the flexibility and power of robust ERP systems, business processes and operational models can be defined in any number of ways within an ERP system. Therefore, while detailed project management is likely to be delegated to others, key decisions about how the business is going to be run need to be made and supported by the management team.
3. Commitment of resources. A common pain point of ERP implementations is lack of resources. While it often makes sense to leverage external ERP experts, these resources can never fully replace the knowledge and ownership of internal employees. The executive team needs to ensure that the company’s best and brightest are committed to the project and that additional resources are provided to support the implementation team’s day-to-day operational duties.
4. Communication with implementation team members and all employees. Employees need to know that the executive team fully supports the project. Therefore, periodic formal and informal communication from the company CEO or executive team says a lot about the degree of C-level support for the project. Although our organizational change management consultants often craft the messages that are to be sent by management to employees, executives need to agree with and deliver the messages in order for them to be effective.
These four areas should be addressed as part of a comprehensive ERP organizational change management plan. As our ERP research and client experience shows, doing so will go a long way toward ensuring a successful ERP implementation.