Hardfacts on Software – Even more cardinal sins of ERP implementation
We started looking at Richard G. Ligus’ list of 12 Cardinal sins of ERP implementation a few weeks ago. I had found a very good white paper online, published originally by Richard G. Ligus of the Rockford Consulting Group, and since widely referenced online. Here are the last few of those sins:
(9) Inadequate Training and Education
Another of the biggest causes of ERP implementation failure is inadequate education and training, which are almost always underestimated. ERP-related training is crucial as most employees must learn new software interfaces and business processes which affect the operation of the entire enterprise. The corporate culture is impacted by changes in the company’s business processes, and shortchanging this part of the ERP implementation leads to much pain and suffering downstream.
It is therefore extremely important to do user acceptance testing. Many factors influence user acceptance, but according to recent research, 2 factors stand out – 1. Data accuracy and 2. Ease of use. These sound obvious, but there are many more reasons, such as personal agendas, reluctance to change in general and suspicion of the motives of leadership. Data accuracy is obvious – if the data is not accurate – people will not trust the system and will stop using it. The same holds true for ease of use – if it is easier NOT to use the system then obviously the system will not be accepted. It is important to ensure that users find the new system easier to use than the old one –and at least initially they need to find it easy to learn.
(10) Poor Project Design and Management
A major mistake is to short-cut critical events in the project plan, such as time for documentation, redefining and integrating processes, or testing before “going live.”
Another common mistake is made when a company leaves out the self-examination of business processes and uses ERP to cover-up weaknesses. It is easier to buy software than to perform the more difficult task of identifying weaknesses and opportunities for improvement.
(11) Poor Communications
One of the causes of ERP implementation failure is poor project communications, beginning with a failure to announce the reason for the up and coming effort, and continuing to advise the organisation of the progress and importance of the ERP implementation to the company. Poor communications prevent different parts of the organisation from assessing how they will be impacted by changes in processes, policies, and procedures. Communications are a vital part of managing change in a corporate environment.
12) Ill-advised Cost Cutting
Another of the key causes of ERP implementation failure is ill-advised cost cutting. In an effort to avoid temporary conversion costs, some companies take a very risky route and go live at multi-plant sites simultaneously, subjecting all plants or some plants to a total shutdown should there be a false start-up. This is suicidal. Others attempt to unrealistically compress the schedule in order to save on expenses, only to eventually overrun both schedule and budget. We feel that ROI should take a “back seat” when upgrading an important part of a company’s infrastructure: the information system. Instead the implementation should be treated as an upgrade to the company infrastructure that is necessary to maintain or gain a strategic and competitive advantage.”
… and I can’t agree more with Ligus on that last point. This concludes our series of the 12 Cardinal sins of ERP implementation. Next week we are going to look at 10 top reasons to shop online this holiday season. As the year winds down we will focus more on the fun stuff!
Until next time then – remember – Keep it (A)fresh