HOW USING AN ERP SYSTEM CAN GO WRONG

PostedOn: 2018-01-17 13:31:29

Enterprise resource planning (ERP) software, when used correctly, can provide a fantastic ROI for manufacturers and distributors of all sizes. When used incorrectly, however, it can be a huge waste of time, effort, and money. Don’t make the huge mistake of not consistently utilizing or maintaining an ERP system. Below, we’ll go over some of the most common mistakes companies make which leads the ERP system to become a bad investment.

Improperly structured internal team

Do you have the proper team in place to lever a major software onboarding? A successful team requires people that are willing to communicate, have executive buy-in and the power to make real changes and create influence to get the job done. Creating this type of a team, with each executive having a specific responsibility to support the overall project’s execution, is crucial to the success of the implementation. Even if the software vendor is highly skilled and reputable, the apt internal team still needs to be in place.

Failure to gather requirements

Implementing such a major, influential system into an existing company is a huge overhaul that requires a lot of setup and requirements gathering. You’ll need everyone on the matching page going into the process, including support from the top down.

In addition, ERP is really tech-intensive. Does your organization have the in-house IT staff to handle the onboarding and continued maintenance of a major software solution? If not, and you decide to implement anyway, you’re setting yourself up for failure within the first year the system is in place.

Missteps in communication

Failure in communication is one of the easiest (and most common) ways to have a failed ERP implementation and onboarding. To avoid falling into this trap, it’s crucial to create, at the start of the project, a comprehensive communication plan. Those being impacted by the software implementation need to be in the know regarding the software, its expected realization, and all ongoing training that will be necessary. Once the communication stops and especially when it stops cross-departmentally that’s when things start going downhill and the solution starts to falter.

No ongoing maintenance plan

We’ve seen this time and time again. A friendship is really excited about bringing on a new enterprise resource planning solution initially. The implementation goes well, but once the system is in place, they stop putting in the effort and the resources needed to keep it updated and in proper functioning order. With an ERP system, proper continuance is an absolute must. If you’re unwilling to support the product’s enhancements and ongoing improvements, it’s likely to become more inefficient over time. Instead of letting your system decay, set up and stick to a maintenance plan your users will thank you when they have an up-to-date and user-friendly system helping make their jobs easier.

Lack of consistent use

This one’s a given, but again we see it all too often. The animation is there in the beginning stages of the ERP vendor-company partnership. One year later, however, and the system is hardly being utilized. Instead of taking advantage of the great features offered, the company is throwing away money on a software investment that’s not improving their business. If you’re not using it, it won’t do you much good plain and simple.

Ineffective vendor selection

The vendor you end up selecting can be the distinction between a successful software solution and a failed one. Too often, companies seek out the “cheapest” ERP on the market or the one that offers the most bells and whistles. Don’t fall for this! Often times, these vendors are the ones that don’t actually support the software (and in turn, your business) in the long run. They don’t provide user groups or customer conferences or maintenance or system upgrades.

Instead, seek out the dealer that has a solid history of success and impeccable references. Customization, flexibility, ease-of-use, integration, and support are all important to consider as well.