“They wouldn’t do requirements gathering, and we can’t do negotiations or project management without that background. They are picking [vendor] without any real requirements, and [vendor] is known to be inflexible . . . train wreck coming.”
There are times when we talk to a company about a potential project only to find that their proposed approach may be a recipe for a train wreck.
ERP systems are an essential tool for organizations, allowing them to manage their core business functions effectively. But, implementing an ERP system can be a challenging and costly process.
One of the most critical steps in the process is requirements gathering. If you skip the requirements gathering process, you are setting your ERP project up for failure. ERP systems are complex, and without understanding your organization’s specific needs, you cannot expect to implement a system that will meet those needs.
Today, we will look at what happens when you don’t do ERP requirements gathering and why it’s crucial to the success of your ERP implementation.
The Importance of ERP Requirements Gathering
ERP requirements gathering helps you to identify what your organization needs from an ERP system. This process allows you to identify what functions and features your organization needs from the system, how the system will be used, and who will use it.
The lack of requirements gathering is especially problematic when you select an inflexible ERP system. Inflexible ERP systems can be difficult to customize, and if you have not identified your business requirements, you cannot expect the system to meet your needs.
This can lead to an ERP system that is difficult to use, and employees may have to resort to workarounds to get their work done.
A Failed Payroll System Implementation
Panorama’s Expert Witness team was retained to provide a forensic analysis and written report to the court regarding the failed implementation of a major software developer’s ERP/payroll system.
4 Consequences of Skipping the ERP Requirements Gathering Stage
1. ERP Implementation Failure
The most obvious consequence of skipping requirements gathering is ERP software implementation failure. Suppose a company skips the requirements gathering process and selects a system that cannot handle its complex manufacturing processes. As a result, the implemented system may not be able to provide accurate inventory tracking or production scheduling, leading to delays in order fulfillment and unhappy customers.
Additionally, employees may struggle to use the system, leading to increased errors and frustration. Ultimately, engaging a manufacturing software expert may be necessary, and software litigation might be imminent. This would leave the company with sunk costs and no return on investment.
2. Lost Productivity
If an organization does not properly gather ERP requirements and does not provide enough training to its employees, the employees may struggle to understand how to use the system to perform their daily tasks.
This can lead to employees creating time-consuming and error-prone workarounds, such as using spreadsheets or manual processes. As a result, efficiency and productivity may decrease, leading to missed deadlines and lost revenue.
3. Frustrated Employees
Employees want ERP systems that are easy to use and meet their specific needs. If the system is difficult to use or does not solve their pain points, employees may become frustrated, which can lead to reduced productivity and employee turnover.
4. Limited Reporting Capabilities
Reporting is an essential aspect of an ERP system, and without a clear understanding of what data your organization needs, you cannot expect the system to provide the information you need to make business decisions.
For example, if a company doesn’t properly gather requirements for reporting functionality, they may find that their new system does not offer reporting capabilities to track business metrics, such as sales, inventory levels, or customer satisfaction. This can make it challenging to make informed business decisions or identify trends that could impact the organization’s performance.
In addition, the company may struggle to comply with regulatory requirements or industry standards because the data in their system isn’t accurate.
Avoid an ERP Train Wreck
Skipping ERP requirements gathering is a recipe for failure. Without understanding your organization’s specific needs, your project team and any ERP consultants you work with will struggle to recommend the right system.
To ensure the success of your ERP implementation, take the time to identify and document your requirements thoroughly. Feeling overwhelmed? Our ERP consultants can help you gather your ERP requirements. Contact us below for a free consultation.