If the term “enterprise resource planning” (ERP) has your executive team shaking in their shoes, then you can bet your employees are a bit worried, too. Implementing an ERP system is a huge undertaking, so it makes sense that you might have hesitations. However, the majority of organizations who face this challenge report success, meaning, there is a correct way to go about planning for and implementing a new ERP solution.
Don’t let fear hold your organization back from evolving. Take a look at some of our suggestions below to help you prepare to face this daunting, yet exciting task.
Change Your Attitude
Many psychologists, life coaches, and management consultants preach that people and, therefore, their organizations, resist change because the unfamiliar causes discomfort. The scary elephant in the room is attitude, namely a fear of failure. Any company with a “zero tolerance” for error has institutionalized that fear, making improvement impossible. The fear of making the wrong decision and losing business and one’s livelihood paralyzes the decision maker who might otherwise lead successfully.
Changing one person’s attitude is hard; converting the fear of a group to acceptance and even enthusiasm can thwart even the most determined cheerleader. According to CIO magazine, one way to sidestep around the fear is to convince oneself that the changes, once implemented, will make the tasks to be performed better. In the case of convincing staff that the changes will improve their jobs, management must ensure that changes are transparent, readily comprehended, and convincing. Solicit employee input, give due consideration to their opinions and requests, and implement prudent changes pertaining to their opinions and requests to build support.
In other words, take employees’ needs into consideration when making ERP decisions.
Unfortunately, ERP software doesn’t come with a set of discrete, step-by-step instructions. After all, you’re not changing a tire; you’re redirecting an entire organization comprised of personalities, habits, capabilities, and equipment all somehow working together to propel the business in the same general direction.
The most important part of effective ERP is to recognize that you shouldn’t attempt to do this yourself. Management is too close to staff, too close to see the problems, too close to see the opportunities. Effective ERP needs a consultant, someone who brings a set of fresh eyes and no previous conceptions, someone who can take an objective view of the organization’s internal and external dynamics and analyze them. A good consultant will learn what the business does and confer with employees to determine how their roles fit together.
Once the information has been gathered and analyzed, the consultant then begins to develop processes to guide workflow for efficient, high quality, and predictable delivery results. Don’t give into the temptation to use processes to strangle the workforce: the best-designed processes are those that imbue flexibility to adapt as the workforce, the workload, and the type of work change. For best results, the new processes will establish benchmarks for performance, responsibilities, and accountabilities. Because we all know that what works on paper doesn’t necessarily work in the real world, a top-notch consultant will oversee implementation of the new processes to tweak and adjust them for effective operation.
Plan, Plan, Plan
Enterprise resource planning implementation can cost anywhere from hundreds of thousands to millions of dollars in man hours and resources — and that’s if everything goes smoothly. While a high ROI is the goal for every ERP implementation, a botched job can prove disastrous and costly. Catastrophic errors result from:
- Poor planning. Up-front planning must be performed in thorough detail. This ensures all parties understand the organization’s current processes and either how to modify them or institute new processes to maximize benefits and efficiencies. This will require a detailed internal audit of all processes and policies, no matter how seemingly trivial.
- Inexperience. Experts recommend organizations bring in an impartial consultant for the ERP effort. However, failing to check the consultant’s references may result in your company serving as that consultant’s guinea pig. Be sure that the consultant can provide a minimum of three references, and check those references.
- Lack of training. Pertaining particularly to software solutions for ERP, the failure to understand key features of expensive technology upgrades results in missed opportunities to implement automation and complete business functions faster. Make sure staff know what new features and capabilities the new technology and processes offer and how to use them.
- Underestimating time and resources. ERP — both in planning and implementation — is expensive. Failure to allocate sufficient resources dooms the effort to frustration and lack of use. Experts recommend budgeting sufficient funds and man hours to ensure adequate staff training in the new processes and technology.
- Multitasking. Studies show that multitasking actually reduces productivity. If you want to minimize delays and accelerate time to completion, then staff must be able to follow processes that allow them to focus on one thing at a time.
- Inaccurate or incomplete data. Conclusions drawn from incomplete or inaccurate data often lead in unproductive directions that require correction down the line. These corrections can result in delays that cost time, money, and morale. To avoid this error, all parties involved from the c-suite to the production floor must be involved in the ERP effort.
- Overestimating capability. This refers specifically to the technology. No bit of software, no matter how sophisticated and robust, can completely replace human judgment or run every aspect of the business. Don’t expect it to do so.
- Failure to test. Ensure your consultant or management team sticks around to run real-life tests of the new systems to ensure they work as intended. This way they can adjust them right away if any problems arise.
- Complacency. Once the ERP implementation is up and running smoothly, it’s tempting to step back and let it roll without interruption. To ensure that this costly investment continues to perform at optimum levels. However, management and staff must periodically review demands and processes and adjust them to serve as business needs evolve.
ERP software is only as good as its implementation. Worries about incomplete or bungled implementation and insufficient resources raise executive trepidation. The antidote for such worry rests in adequate employee training, dedicated investment, and accountability. Employees must feel confident that they either have the skills or will receive training in the skills necessary to accomplish the tasks assigned to them. Management must also ensure employees have the equipment and capacity necessary to perform the work at hand.
Take a careful look at your plan for ERP implementation before you get started. Following the tips outlined in this article will help ensure that none of your original ERP fears come true.