|ERP - Possible failures that cause poor implementation
It is a set of information systems that allows the integration of certain operations of a company, it works as an integrated system, and although it may have modular menus, it is a whole, that is, it is a single program with access to a database centralized automate many aspects of services and products, a software architecture that facilitates and integrates the functions of manufacturing, logistics, finance and human resources of a company.
The companies are in constant effort to include in their systems an ERP, at present there are many brands that handle very robust solutions for large emporiums and for the media, small and microenterprise, during my career, he has had to have the details with the implementation of these systems to 100%, even when I arrived at a completely finished project, well theoretically its operation in totality.
For example, I have found that the implementation has been carried out by a large and prestigious consultant and the ERP in question was the most representative of the world market, in other words, that the "guarantee of success" is completely available, however, unfortunately, totally or partially.
It is often found that unfortunately after the implementation of the system, many companies are faced with the fact that the ERP, there is no collaboration in the achievement of objectives or optimal performance, which entails the need to make changes or costly changes for the organization, in some cases, I have found the functions of using ERP, including complete modules.
Why, if the ERP project was delivered 100%, with documentation, technical data sheets, training and good feedback from the heads of the company and the consultant, today we do not use 50% of it and a lot of information comes out of Excel or some another source?
What could be the circumstances that cause this type of results to arise?
What happened or what happens within the company?
Well, I will make some recommendations, without references in particular to any company or business, what is intended is that, during a process of implementation by the IT area, are contemplated and can contribute to other areas of the company the guidelines to continue to succeed in the implementation and / or continue with a project, in which the maximum functionality of an ERP must be achieved.
Note: The dilemma that many small and medium enterprises can have when implementing a business management system is whether they really need it or not.
We think that the meetings were already held, where it was determined that to drive the business it is necessary to centralize the information and automate processes, through the implementation of a software that controls the operations of the business, warehouses, accounting, human resources, information technologies , finances, traceability, stamp invoices and payroll, acquisitions, among other requirements.
Then the business project of implementing an ERP is formalized, one of the first failures that I have noticed, is an inadequate definition of the scope of the project, often, large implementation projects fail even before they begin and the reason is must, most of the time, to an inadequate selection of management software.
It is necessary to plan at the beginning of the project what is really what the company needs and have well defined objectives to implement a software that meets the requirements and avoid embarking on a business management system that ultimately does not comply with the expectations, for this there must be the figure of a Key user, who understands the operation and knows the business, however the crucial profile is that he is aware of the processes, if possible with profiles defined by HR.
For all the projects of a company, not having the commitment of the management of the company, is an anticipated failure, even when those responsible are dying to give the result, therefore, the management of the company as managers of it, they must understand that the problems mentioned above must be resolved before they occur, that is, when the idea that an ERP system is a tool that will bring advantages to the organization is accepted.
The lack of participation and commitment on the part of the executives of the organization directly affects the performance of the software and the results; It is essential that everyone is involved in the implementation of the system, it must have the participation of the members of the company management, this will help to keep abreast of the updates, understand the technical aspects and the scope of the system, this is the second problem that I have encountered.
One of the most difficult aspects, which consumes much of the time prior to the implementation of information technology and human resources personnel, is the resistance to change on the part of the work team, no matter how mature our company is, we will always find This type of attitude disguised as events that give the idea that the ERP is not necessary and that it will not be used.
The biggest obstacle in the implementation of an ERP, is this third situation which mostly favors the failure in the implementation of an ERP, the team may be reluctant to use the system for different reasons and usually these are derived from the fear, we must understand that when implementing a business management system many employees may be worried about their jobs or believe they are unable to learn to use the software, however, whatever the reason, the solution is in knowledge.
It is very important to let the work team know how the new system will benefit them and the company and all the advantages that it can offer, once the employees know about the system, they will feel much more enthusiastic, of course with Quality information.
Therefore we must create awareness and culture to change, starting with the CEO and ending with the users, all the company's collaborators have to have a greater or lesser involvement in the project and be aware of it and its role in it , then the Directors, Area Managers, Section Heads, etc., must be clear that the new information system is implemented to improve and grow the company and themselves, they must establish from the first moment of the project, their objectives and those of the members of their teams and include, the tasks of the project, in their daily tasks forming part of them, and they are right, for a time they will have to work alternately, one, as things are done before the ERP and two, during its implementation, so as not to hinder the business and advance the integration work of the new system.
Having the objective and scope of the project, we must start to establish the metrics that allow us to know where we started, how the processes and implementation tasks are being developed, so if by some variant or variants the results are moved we can have problems in the implementation, therefore the fourth situation that leads to a bad result, is not having indicators to measure the results.
It is very important not to have unrealistic expectations, it is also a mistake that can cost the company very expensive, we must be very careful, since many times the ERP providers assure that the system can be implemented quickly and at a low cost, however, the statistics show the opposite, alert with this is a mirage if we do not land it well.
If indicators are established to measure unrealistic results, in the end the system will end up disappointing the staff, to avoid it, it is necessary to be clear with the expectations.
Once the organization makes the decision to implement an ERP system, the first step is to have a clear definition of success, including the problems that must be solved or what will be the desired result, as well as the objectives that are pursued.
Consequently we can incur a problem with many hidden damages if we are not careful and we make an inadequate choice of tool and consulting company, these decisions are the fifth situation that I consider contributes to a bad implementation of an ERP.
Undoubtedly, wrongly choosing the software of the business management system can be devastating and this, in part, can be caused by a bad choice of the consulting company, often it is a consequence of sacrificing the results based on the cost and can be the worst mistake that the organization can commit, because although it is true that the cost is important when selecting the tool, this factor should not be the most important for the organization, functionality is undoubtedly the key to success at long term.
As a sixth factor is whether the publisher, partner, consultant or those who implement the system, do not effectively have specialized staff with the right experience, by virtue of being business partners and that does not have an accurate understanding of the project and the objectives of the company.
Then they must encourage their consultants to know their responsibility and that this generates a strong commitment to the result, so they must participate jointly with the company in defining the precise and clear objectives of the project.
As a result of the previous decisions, it is almost impossible not to have anomalous situations, remember that when an ERP implementation is carried out it is very likely that the servers and the work stations need to be revised to integrate the new system and it is possible that they should be ordered , buy and replace with new and more modern, the internal network should also be analyzed and modernized if necessary, the speed and bandwidth of Internet access available to the business, should be taken into account possible technical problems with the devices mobile devices that should be used, this is the seventh reason why the project may be affected.
If these aspects are underestimated, they can impact the results of the project, delay the start-up and operation or generate a slow performance for the first weeks or months and, therefore, affect the business.
The eighth reason is quite interesting, because it is based on the criterion and is expected immediate results, without making changes in the processes and / or practices of the company, it could be said that the evaluation stage is the most important during and after implementing a ERP system in a company.
Let's clarify the point, the purpose of the evaluations of the business management system is not knowing whether the software works or not, but verifying that it meets the needs of the business, it is essential that all team members and users of the ERP are aware of that this tool will generate benefits in the short, medium and long term, as some processes or practices in the company are modified.
It is important that the leader of the ERP project is a committed person with experience in management; since the implementation of a business system requires dedication on the part of a leader that facilitates the delivery of results, transparency and the ability to make decisions.
This situation is characteristic of the ERP implementation, it is very unlikely that you will not find it, we have for the first time when transferring your data to the new system from Excel spreadsheets, manual records or old disparate applications, this is not reliable, even when the consultant's tests and technical references say that there are no problems, basically, the problem is that the old data that you have used and stored for years can, for many reasons, seem inaccurate or even incorrect in your new business management system, it is important then, that in the planning phase of the project time and resources are assigned for this type of corrections, many times they are assumed.
Please be careful when verifying that your data is correctly reflected during the implementation, make sure that the consultants carry out pilot tests of the new results in the system using legacy data before converting or transferring all your data to the new system, giving rise to the ninth reason for failure.
The tenth reason for failure can be given; because when solving the previous ones, the time was consumed, the objectives are being forced and results are demanded, this can cause that the adequate and complete training to the personnel is not provided.
The management of IT projects, and the top management of the company, should not rush into starting to use an ERP software, without adequate training of users and unfortunately it is always done, it is not taken into account that in planning systems of business resources are increasingly used by personnel within the company.
Therefore, all the actors involved in the use of the system must receive operational training, as well as the way in which the processes with the ERP will be carried out and thus have greater efficiency, often companies underestimate the training to when implementing a business management system.
Empowering only one or two people properly and instructing the rest of the employees is a recipe for disaster, although it is very important that you have an expert user, all employees who will have access to the system should have the opportunity to work and learn directly from the ERP consultant, in order to take advantage of all the benefits of the system.
Selecting a system that adapts perfectly to the needs of the organization is the key, however, it is useless when users do not have enough knowledge to execute it. Important: Well, again, in the important role played by the management of the company, not only is there a component of monitoring and decision making of the project, but its main contribution must be the clarity of the definition of the objectives and communication and motivation to the organization transferring the advances in the marked objectives, the difficulties and inconveniences, rewarding the individual and collective successes of the project, so that the new system is assimilated as crucial for the business. It is not just about monitoring to obtain quick results, leaving the project in the hands of a consultant so as not to alter the day-to-day of the business and to become the sole leader of the project and promote the change of processes in the company. inspire its collaborators so that, using the new system, a better company is built among all, strengthening its position and incorporating best practices. We must take care of these situations that can cause variations in our implementation of an ERP, remember that delays, failures and bad decisions will directly affect costs, which somehow the company always absorbs.
I hope it will be you useful.
Thank you so much
Rubén Bernardo Guzmán Mercado