Why ERP projects are not providing the expected value




By Marius Wessels

Enterprise resource planning (ERP) solutions have become an essential asset to organisations and a fundamental asset for most large organisations. The adoption of ERP systems has increased at a rapid rate leading up to the pandemic in 2020. However, the COVID-induced challenges sparked an interest in, and demand for increased transparency, accountability and resilience, which are all core elements of the typical ERP value proposition.

Just as every business is unique, the same goes for every ERP implementation. How long it takes depends on a variety of aspects, such as who and how many people will be using the system, the size of the company, the availability of resources and the amount of data that must be migrated. Yet with change being what it is – inherently difficult, more so for some than others – many companies that have implemented an ERP system are yet to fully receive their expected value.

With the growing adoption of the solution, so do the number of implementation and managerial issues that are negatively impacting the return on investments organisations receive. This is due to some of the many misbeliefs, misconceptions and myths around ERP technology, which if understood, can easily be overcome.

Myth: It takes on a big push!

One of the most common myths that lead to disaster is thinking that an ERP system takes one big push during the implementation stage, and once completed, it is smooth sailing from there. This couldn’t be further from the truth!

It is true that the implementation stage requires massive amounts of time, work and acceptance from many managers and areas of an organisation, but the work does not stop there. Once a new ERP system is in place, continuous analyses and engagement with the system must be done to keep the solution relevant to the current business operations and agile enough to make changes to external factors.

Continuous change management is important throughout the lifecycle of an ERP system, but organisations tend to limit these practices to the implementation phase. Employees are trained to use the system, build a management strategy, and communication plan and even run post-go-live assessments. But then the effort tends to decrease rapidly.

It is no surprise that recent studies reveal that maintaining change management practices was rated among the least common activities for organisations implementing and managing an ERP system. These practices are essential and include resistance management, building feedback loops and developing coaching plans for leaders, all essential activities that should be considered best practices, but are slowly neglected until their ERP system provides little to no value at all.

To ensure that the ERP system remains relevant to your organisations operational needs, coaching plans and user training throughout the organisation must be maintained long after implementations are complete. Often key managers or executives are selected for training, while the ERP system’s real day-to-day users of the factory floors are seen as an expense and unnecessary.

Myth: IT owns the ERP

Business decision-makers can bypass the IT department and purchase an off-the-shelf ERP system for their department. Similarly, businesses can also outsource ERP data entry to experienced and recognized vendors, which will save them more time to focus on other tasks.

However, it is crucial to foster communication about, and ownership of the ERP across the organisation, to then collect feedback from users and managers for executives to make data-driven decisions for the future.

Taking a step back to the implementation phase, an ERP “super user” or committee is put together consisting of all members and managers from across the organisation. This committee is instrumental throughout the implementation stage, gathering data from various departments that are then input into the system. Although IT plays an essential role during implementation, proactively building a sense of ownership across the executive group, as well as the rest of the organisation is an integral part of the success of ERP.

This committee should regularly meet to analyse the performance of the system during the managing phase. An ERP super user is someone who is well-versed in the new system’s technical features and knows how to leverage the software to perform complex tasks. Not only does this keep your IT team from being inundated, but it also encourages teamwork and camaraderie among departments. When team members better understand how to use and apply ERP technology, the overall mood can lift, and the project is seen in a more positive light.

However, before they can serve in this important role, super users must be properly trained.

Myth: ERP users don’t need training

Yes, all ERP users do need training, even the super users! Before super users can take control of their position and begin designating training to others, they first need to be trained themselves. In addition to receiving one-on-one training, super users should also sit in on formal group training sessions from implementation and years into the managing phase of the system.

Organisations and super users tend to only participate in software and service provider communities at the decision and selection phases of ERP. However, continued participation in these communities gives ERP leaders in the business access to a vast network of industry experts, knowledge, experiences and insights to ensure that the organisation is getting the best long-term value from their ERP providers and software.

This way, they can deepen their ERP software knowledge while at the same time, learning about the challenges users are experiencing. By gauging user reactions, they can tailor the approach they use in working with these users throughout the project.

Make sure the myths talked about in this blog don’t make their way into your projects plans. Your company will need help when embarking on a project as detailed as an ERP initiative. As digital transformation shifts the balance of power across markets, now is the time to cast scepticism to the side and embrace enterprise automation for what it is – the future of business as we know it.

(Marius Wessels is the Professional Services Manager at SYSPRO Africa).

Advert:




Be the first to comment

Leave a Reply

Your email address will not be published.


*


This site uses Akismet to reduce spam. Learn how your comment data is processed.