Last week, we hosted our first ERP Boot Camp of 2013. During the three-day session, we interacted with a number of commercial and government clients as well as potential clients looking for ERP software guidance and best practices like those in explicated in the video above. The organizations that attended are at various points in their ERP implementations, with most of them in the planning phase or early stages of ERP software selection.
The three days were packed with eye-opening information and best practices and were attended by business executives, IT Directors, project managers and ERP implementation team members. As is typically the case, there were a few common threads discussed by participants multiple times throughout the Boot Camp sessions. Below are just a few of the lessons and ERP best practices discussed:
ERP implementations are business transformations, not software initiatives. Most executives invest in ERP software because they want to improve and transform their businesses, not because they necessarily care about the technology per se. However, somewhere along the way of many troubled ERP implementations, project team members lose sight of this mentality and instead get caught up in the bells, whistles and alleged “best practices” of the ERP software being evaluated or implemented. As outlined in our 2013 ERP Report, the most successful ERP implementations are those that begin with the business and define how ERP systems are going to support that business, rather than the other way around. This subtle – but extremely important – philosophical difference will determine how well your organization is able to adopt other implementation best practices, such as the ones mentioned below.
Organizational change management is critical to ERP success. It was interesting to see how many participants were dealing with significant changes in their organization in addition to the changes triggered by their ERP implementations. For example, several participants noted that they were experiencing the pains of aggressive growth, acquisitions, new office locations and/or efforts to standardize business processes across multiple locations. Given the fact that their employees were already having trouble adapting to these changes, participants were bracing themselves for additional organizational change management issues related to their new ERP systems. That being said, many didn’t necessarily understand how to tackle this colossal challenge. Most already knew the importance of end-user training but after three days of sessions, they also understood the various components of a successful organizational change management strategy, including:
- Tailoring training materials for company-specific business processes, roles and responsibilities
- Defining and documenting reengineered business processes and workflows, including those outside the ERP system
- Documenting and communicating the specific organizational change impacts resulting from new business processes and software
- Communicating to and training employees on specific job changes as they relate to their roles and responsibilities in the organization
- Integrating benefits realization activities into the overall organizational change management strategy to ensure optimized adoption of the new system
The role of business process reengineering is different than what most ERP vendors and system integrators suggest. Most ERP vendors and system integrators have been fine-tuning their craft for a long time now but, unfortunately, that craft involves a lot of bad habits that have contributed to the abnormally high ERP failure rate over the last several years. In addition, most ERP vendors are good at implementing ERP software, but not nearly as good at delivering large-scale business transformations, which is exactly what ERP implementations are and should be. In a business- and best-practice-driven implementation, business process reengineering happens before – not after – the implementation begins. There are multiple iterations and levels of detail required to effectively change and document enterprise business processes, and the software-agnostic processes should be reengineered so that the best software can be selected and designed in a way that addresses those business process needs. This approach is different and much more effective than the traditional, misguided approach of letting the software drive the business processes.
Our team of facilitators and partners involved in helping us host the event were amazed at how forward-thinking many of the participants are. While the organizations were already ahead of most, they also recognized the need to learn more and continuously improve their projects, which is an important trait of any effective ERP implementation team. We look forward to continuing to work with these organizations as they continue their journeys on their ERP implementations.
If you weren’t able to join, you can still get a taste of what you missed by viewing our on-demand webinar Ten Things Every CIO Should Know About ERP Systems.