Mistakes ruin ERP implementation can be mitigated when you understand their core cause and work on a plan to address every single mistake separately.
In the following article, we will list some of the commonly happen mistakes.
The implementation of an ERP is one of the major decisions in the lifecycle of an organisation. According to Gartner, approximately 75% of all ERP projects fail. 61.1% ERP implementation take longer than expected as per Panorama ERP study. And more than 74.1% of implementations exceed budget. There is also an overwhelming percent of companies who don’t end up getting what was promised to them. For an organisation spending millions of dollars and almost two years in implementation of ERP, it’s vital to take care that sufficient measures are taken to ensure success of the project. A few mishaps along the process can ruin your ERP implementation. The following study analyses the common failures to help you take action proactively & save your investments from an ERP failure.
Mistakes ruin ERP implementation
1. Top management expectations
This is a common mistake when the top management dreams and expectations are away from the reality and over the assumed capabilities of their team, top management are usually having a full trust on their team in running the business and assumed that they will have the same level of skills and commitment when implementing a strategic critical solution like ERP. The reality is the opposite, as ERP implementation require new skill set needs to be acquired and train the staff on how to create this new environment, so, when the staff is lack of these skills, that creates a kind of resistance to the new environment and system, usually the humans are satisfied with their comfort zone and the old way they are doing business, and afraid of what they don’t understand, we will explain this point in more details in the coming point.
2. Staff resistance
The staff resistance in adopting new environment and systems can be a showstopper for the ERP implementation, as staff may have several reasons to stick to the old ways of doing business such as they memorised the old way, or it is satisfying their comfort zone, or don’t understand the purpose of the new system, and extra effort they should do in data entry for example, so there is an important internal exercise that should be done to get all employees buy in, and it is not an easy one.
This may require an intensive work from the organisation internal development or a consultant to assess staff skills and propose the required training, also to explain to the staff the purpose of the new system and how this system will help them to enhance their performance, and the overall impact on the organisation.
3. Executive Sponsorship
Executive sponsorship is one of the key success factor of ERP implementation, although some of the executives understand this the wrong way, they may perceive the sponsorship is their approval to go on with the project, but in fact this not what it means, it means the CEO involvement in the project, as the CEO is the person who putting the strategy in the organisation and the most person that sees the benefit of implementing ERP, so their involvement in the project is very important to review and correct the directions and keep staff informed about the importance of the project for him, from our point of view failing in such a project is the failure of organisation strategy and the CEO himself.
4. Impossible dreams
The lack of skills and knowledge about the ERP implementation can develop requirements that cannot be achieved in the organisation because of lack of resources or budget or any other requirement, which we call it the impossible dream, so ERP implementation comity should include a knowledgable consultant that can understand what can be done considering the available resources and the size of the organisation.
The best ERP in the world may not suite your organisation, and the measurement is not only the price or the ERP software features, there are many factors involved in software and vendor selection, so it is always better to have a professional ERP consultant involved early in your ERP project.
5. Bad project planning
The ERP implementation requires a clear roadmap from the beginning of the project, clear requirements, objectives and planning for implementation, these are the key to effective results, The ERP software became very comprehensive and include modules related to every department in the organisation, it is more of a collaborative tool and process where the key stakeholders should be involved from the vendor, consultant as well as the organisation key people.
The ERP implementation comity should discuss the gap analysis and solve the process gap, key performance indicators, they also should put benchmarks and timelines for the implementation to achieve the objectives of the ERP implementation project.
The above are some common mistakes ruin ERP implementation, and unfortunately there are more, that’s why 75% of the ERP implementation fails, and the first reason is lack of skills and knowledge, and comes in the second place the lack of participation from the management.
iX Dev professional services team had been listed as one of the Top ERP consulting services by DesignRush, because our consulting team is taking all the considerations for the ERP implementation and apply world best practices to have finally successful ERP implementation.