Implementation Challenges

Over 52% of ERP implementations fail. ERP implementation is expensive in terms of money and resources it consumes. There are many documented reasons of ERP failure but some of the recurring ones are:

Unrealistic expectations: Many businesses believe that ERP implementation will address many process related short comings. A broken process can not be automated. Business Process Reengineering should be done prior to implementing ERP. ERP is a tool and if not used properly will give erroneous data. Without proper controls in place, the tool will not be able to catch and fix human errors.
Lack of initial planning: ERP implementation has t be planned well in advance. Since the impact is business wide, lack of planning can create unpleasant situations if even de-risking steps have not been taken. Order in which each department comes online can have bearing on user acceptance. If data is not migrated correctly, it can cause significant amount of downtime for the business and frustration for customers, employees and vendors.
Lack of buy-in By:
   
Organization: ERP must be sold to the business in order to take complete buy in from the organization. Business case should be pitched which will allow users to keep big picture in mind. For each department, "What is in it for me?" question must be answered. Providing appropriate amount of training helps. Organization must be prepared to expect some changes. ERP implementation will fail if users expect that their way of working is not going to change. Most of the time, the change is for better but once in a while some users may have to take on extra responsibilities in order for rest of the organizational goals to be met. Senior management should be aware of such instances and appropriate steps should be taken to address legitimate concerns.
   
Timely and effective communication plan should be put in place to roll out the system. A good communication plan helps prepare the organization for changes that are going to take place.
   
Conference Room Pilot (CRP) is an effective way to giving users early look into the system. Properly monitored CRP can increase users involvement as well as give users the feeling that their voices were heard. CRPs turning into requirement gathering sessions must be avoided.
 
Senior Management: ERP implementation warrants complete commitment by the senior management. Most of the time, Senior Management under estimates the amount of help organization will need in order to smoothly make all the changes needed to successfully implement ERP and to use-
Lack of Implementation Plan: Many ERP implementations fail because of lack of "effective" project/program management oversight. User's wish lists tend to create scope creeps and inability to effectively handle such situations creates a long list of customizations which are either unnecessary or can wait past implementation. Without putting the rigor of making business case for each customization request, the list can become unwieldy very quickly.
 
 
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