An integrated ERP solution can do wonders for a company’s efficiency and effectiveness. The advantages of having a cohesive ERP software that handles all the business processes is a goal worthy of time, effort, and the financial resources allocated to it. But the process of selecting the proper enterprise software and implementing it can be a nightmare if done without due regard to the complexities involved.
ERP systems must be a good fit for the company’s requirements. There are a myriad of factors to consider when outsourcing your ERP solutions. Otherwise, disasters such as total failure and wasted man-hours will occur. Here are the major five mistakes that must be avoided and the solutions that will help you create and implement a feasible ERP strategy.
1. Inadequate Planning and Low Level of Support from Top Stakeholders
Poor planning will almost guarantee that your ERP solution fails. Take time to assess the costs and benefits. Also, try to determine how much the ERP software will impact the organization once it has been deployed. The planning must cover all phases of the project, i.e. from requirement analysis to deployment and maintenance. Any phase that is poorly planned will affect the project negatively. So, it is necessary to determine the specifics of scope, complexity, and size of the project.
Ensure that the key stakeholders, (the top management of the company such as CEO and the CTO) are on board for the ERP implementation process and are fully committed to the project from the beginning to end. Detailed documentation of every step is also crucial.
2. Poor Change Management Preparation and Inefficient Training
Employees will be most affected by the implementation of ERP system. If inefficient training about the new business process is provided to them, it may lead to job dissatisfaction and high employee turnover ratio.
Since ERP implementation will entail major changes across the organization, handling this enterprise-wide change has to be done according to a pre-set plan. So, the ERP team has to make sure that the solution fits well into the corporate culture and the affected businesses process is transitioned over properly. Though employees may resist this change in the beginning as they are used to performing their tasks in traditional ways, proper training programs will ensure that the employees realize the benefits of the software solution and learn how to use it effectively.
3. Selecting the Wrong ERP Solution that Misaligns with Business Processes
Companies often fail to identify the needs that the ERP solution has to address. This can lead to problems as big as choosing the wrong ERP vendor or failing to incorporate the ERP solution into the organization’s business processes. Though these are worst-case scenarios, even if the solution is misaligned with a few levels of organizational structure, the effects may turn into bigger problems in the future. This leads to loss of time and productivity that end up making the stakeholders question the wisdom of such a costly project.
The decision for deploying enterprise software should be objective and the features offered by the vendor must match your business requirements.
4. Failing to Estimate Resource Usage and Misallocation of Resources
ERP systems are complex as they require a lot of steps to be implemented successfully. However, changes are rolled out slowly. As the changes are made, the new processes are also being tested to see that they perform up to the mark and as expected. If you assume that the vendor will take care of all these steps, you are mistaken. Vendors are experts in their respective fields but they require detailed information and feedback from the organization while they work on implementing the chosen ERP systems. Therefore, your company is responsible to allocate the required resources that are involved in the process. The right resource allocated to the right task at the right time will make all the difference.
5. Considering That ERP is a Simple IT Project
Assuming that implementing ERP solution is just another easy-to-handle IT project is a mistake which can cost a lot to even the largest organizations. Making this mistake in the form of negligence while implementing crucial steps of ERP may result in wastage of time and other valuable resources.
So, if you are investing in an ERP solution, you should carefully review your business plans and ensure that these deadly mistakes do not cause any failure to your business objectives.