Why do most ERP projects suffer?
Usually ERP projects create a series of challenges for organizations, in many cases the combination of two or three of these challenges may be enough to cause delays, friction and possibly loss of ROI of the project. These challenges are:
- ERP implementation requires clear understanding of the existing business processes and aligning those with the business software. This alignment creates a certain amount of tension, as exemplified by concerns such as ‘should I change my business process or change the software’, ‘do the best practices brought in by the software really work for me, my team is resisting the process change but changing the software may lead to future technical difficulties with software upgrades in subsequent releases’.
- ERP implementations also put a huge strain on top and middle managers. They need to attend frequent project meetings, make tough decisions on process changes, sign off (and take responsibility for) project documents, dedicate their best people to the project, and do all of this while managing their day to day business. It is especially challenging since most implementations run for six to twelve months and even longer in some cases.
- ERP projects do take time before producing their first tangible results. Unlike in the construction of a building, you don’t see much until the ERP project goes live; it is almost all or nothing. This means long hours, strain, frequent meetings, yet the outcome is still months away. Without an internal motivation and communications program, people get tired, they start missing deadlines which causes the project to suffer from delays. These delays in turn drive the implementation consultant to become less flexible in order to save on costs in what is usually a fixed price engagement.
- ERP projects also tend to suffer from scope creep. With changing scope over time delays are common and this tends to increase the cost for the implementation consultant, which in turn creates friction between the client and consultant, and may even jeopardize the success of the project.
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Quite inspiring,
Keep up the good work,
Thanks
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