Tuesday, February 18, 2014

How to solve The Trouble with Enterprise software

The article “The Trouble with Enterprise software” was very pervasive in covering the issues companies have faced with Enterprise Resource Planning (ERP) systems. However, I don’t completely buy it and I will vouch for implementing ERP solutions to organize data and make the business efficient. Here are some of the ways we can eliminate the extensive set of problems companies face while revamping their legacy systems.

ERP success is 75% about people. The No. 1 mistake is to believe that ERP is an IT project. Line-of-business executives have an unfortunate tendency to see ERP as something the IT staff should "just handle." For teams with very full plates, the technology-specific portion of these projects alone is daunting. ERP systems touch, and potentially change, every aspect of a business' daily operations. The staggering level of detail required to understand and document how things are done demands a structured process review. It’s not about scheduling a few meetings with department heads - dig deeper. Tribal knowledge tends to accumulate with the middle managers who control functional areas and trickle down to the people in the trenches. Someone who's doing a focused task every day will have critical input on inefficiencies that you won't get from higher-level managers.

Establish an executive sponsor with broad authority. IT pros hear a lot about "getting a champion," but with ERP it's non-negotiable. This person should be as high on the org chart as possible, thoughtful but decisive, convinced of the need for the project and capable of jumping in on short notice to arbitrate disputes and quell resistance. Pair this person with a project manager, internal or external, who has experience on the ERP platform, good communication skills and a strong grasp of project management methodology. This person is responsible for noting and managing tasks, negotiating and setting due dates, guiding the project from objective to objective and ratting out or identifying teams or individuals who are creating delay.

A lead implementation consultant is also important; these people are usually, but not always, hired guns with a thorough knowledge of ERP in general and the new platform specifically. Finally, identify subject-matter experts who are intimately familiar with one or more areas, such as finance or warehousing. Arm your team with tools commensurate with the volume of information that needs managing. An issue-tracking system is a must, and a schedule built in Gantt form will help head off problems. Let's face it -- people tend to forget what was settled on because of information overload, a problem this consultant solved by playing voices back later; that clearly showed when and by whom any major decision was made.

ERP implementations are almost always based on real or perceived inefficiencies, as you discuss and map processes, people begin to ask, “Should we be doing something differently?” Unfortunately, this can cause "paralysis by analysis" that leads to extraordinary delays as system experts work with decision-makers across departments to analyse, test and model alternative processes. While this is basically constructive, it pushes due dates and can create enormous additional costs.

No matter how creatively business leaders and system implementer’s work, there will be cases where employees must either change their behaviour or IT will be forced to customize the ERP system. The canned behaviour of a given system simply may not work for your organization -- or, stakeholders may decide it won't work, which is where things can get dangerous and expensive, fast. Customizations to ERP systems by professional services firms can range from 20 or 30 hours for minor stuff up to thousands of hours for major integrations with other systems or for dramatic changes in core functionality. Choosing whether to customize is a balancing act. On one hand, customizations add delay, cost and complexity to an already complex project and system. But on the other, a judiciously justified customization can make all the difference in the world for an organization with unique pain points.

To conclude, we can handle all the problems especially the people issues which stem from the implementation of an ERP system. An ERP solution can revolutionize the way a company handle s business and therefore the change management required a part of the process id worth it.

Question: Would like to open the floor for discussion on how else do you think people problems and other issues arising from such vast change can be addressed?



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  2. Greatful informations on ERP solution.
    It looks like you spend a large amount of time and effort in writing the blog. I am appreciating your effort.
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