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Panorama’s 7 Deadly Sins of ERP Implementations
Tuesday, July 27, 2010 by Jenny Lowry
Panorama Consulting Group recently posted a blog post outlining The Seven Deadly Sins of ERP Implementations. In this post, President and Founder of Panorama, Eric Kimberling, discussed the seven key items that can disrupt an ERP implementation if overlooked. However, one item that Kimberling failed to mention is how a qualified ERP software partner can help you navigate the implementation process without falling into these traps:
- Program Management: Managing all of the different moving parts of the software implementation, such as business process improvements, business acceptance, and organizational change management, requires strong program management, governance, and controls.
Socius has a dedicated Project Manager for every implementation and incorporates a Quality Assurance program to provide confidence that the deliverables and services of the project will fulfill the defined requirements for quality. Quality assurance events are scheduled early and across all of our project phases to detect issues and improve the performance early in the project lifecycle. A Project Charter is developed to manage the project and ensure that all tasks, processes, and timelines are being adhered to.
- Business Process and Workflow Definition and Improvement: Business process improvements, workflows within and outside the system, and employee roles within the system all need to be defined before the system can be fully adopted.
Socius can help by providing a Business Process Review that identifies any gaps between your strategy and execution. During a BPR, we analyze current systems and critical business workflows that will be impacted by the implementation of a new system. These business requirements and related workflows are documented and reviewed alongside the core functionality of the new system to ensure maximum future efficiency. A core team is created with members from all departments and business groups in order to plan the scope of the implementation, determine how it will affect all areas of the business, and ensure user adoption.
- Organizational Change Management and Communications: A robust organizational change management program is crucial to gaining employee adoption and business benefits from the system and includes communications targeted to each major workgroup, business process training, organizational impact assessments, redesign of employee roles and responsibilities to match the new system, and a host of other key activities.
Socius develops a Communication Plan with documentation to clearly identify our project goals, timeframes, and expected outcomes. We provide interactive classroom-style training to encourage participation of members in all departments during the phases of our implementation process and to ensure user adoption. This training is typically conducted by the organization’s project team, thus proving corporate ownership of the new system. Socius conducts a Business Impact Assessment to help organizations identify their corporate objectives, understand what their strategies are and the obstacles they face in meeting those objectives, and help them build a winning strategy to accomplish their objectives.
- Business and Technical Integration: Integration to systems and business processes outside the system need to be managed from a technical and business design and testing perspective; otherwise, the system will be fragmented and disjointed, which defeats the whole purpose of ERP.
Socius’ consultants have extensive experience with several types of integrations. We discuss plans for data conversion, integrations, and infrastructure upgrades prior to any type of implementation.
- Globalization and Localization: Many organizations want to standardize business processes across multiple locations and countries, but some level of localization needs to take place. Whether it’s local regulatory needs, reporting requirements, or shipping and customs processes, some aspects of the global rollout may require localization and can delay a project if these aspects aren’t defined early on.
Socius has clients with multiple locations spanning the US and other countries and therefore takes proactive measures to determine what processes can be standardized globally and which require localization.
- Independent Oversight of Technical Resources: Without clear direction, guidance, and project controls, it is easy to fall into a spiral of unnecessary customization, configuration, and set-up that doesn’t meet key business requirements and results in higher costs and longer durations.
With Socius’ proven process using a detailed Business Process Review and Business Impact Assessment, along with a dedicated project manager, we avoid the pitfalls of unnecessary customizations and other tasks that can delay a project and result in higher costs.
- ERP Benefits Realization: This may be the biggest sin of all. Too many companies spend millions of dollars only to fail to realize the expected business benefits. In fact, Panorama’s independent research shows that most ERP implementations fail to realize at least 30% of the expected business benefits. A key reason for this is a lack of a robust ERP benefits realization program.
Socius creates a Business Value Summary that details the features of the ERP software, the benefits of these features, and how they meet organizational objectives and business requirements.
Sounds like you have a good process for addressing common pitfalls with your client. A lot of vendors and consultants overlook these areas, so it’s good to see a company like Socius thinking through these issues.
Thanks for referencing our blog.
Eric