When ERP Implementation Goes Wrong

PostedOn: 2017-09-25 13:11:40

It’s hard to get well from a failed ERP implementation, but at least there are valuable lessons to be learned in order to avoid suffering the same fate.

One particular client, whose name he understandably chose not to release, had an implementation that was a disaster from Day 1. It was spearheaded by an employee who lacked the appropriate skills and experience to do it. Software vendors made decisions to suit themselves, not the client company. There was no clear IT strategy or project governance. Managers declined to hire outside consultants and went live with a flawed system.

Before starting to shop for ERP solutions, he advises, take the time to define a crystal clear IT strategy and roadmap. Be sure to include not only what you are going to do, but why you need to do it now. Know what your overarching business strategy is. Finally, know how ERP will help you achieve it.

Don’t underestimate the need for organizational change management. Is your company ready for a new system? Implementing ERP can be one step in a series of comprehensive changes. Although the sales team pushed for a new ERP solution, its members were among the first to reject it when it made their work more difficult. Besides, he says, even the sales team could not figure out how to use the new system. 

Define your business processes clearly before implementing ERP. Software vendors jumped straight to configuring this client’s new system without first assessing how things were working – or not working -- beforehand. ERP software cannot define these processes automatically. 

Know who’s responsible for what from the outset, particularly who will step in when things inevitably start to go sideways. Without clear project governance, controls, and checkpoints, finger-pointing and infighting could quickly derail the entire effort.

Hire independent ERP consultants at the start. Solution vendors are excellent at managing technical configurations and customizations, but they rarely can help with overall organizational change, data migration or business process design. 

Key Takeaways:

  • Define a clear IT strategy and create a roadmap for getting there before shopping for a new ERP system.
  • Determine what other organizational changes may be needed and how the new ERP will play into those changes.
  • Know who’s in charge of what with controls, checkpoints, and a well-crafted governance plan