Thursday, January 5, 2012

Why do so many ERP implementations end up in frustration?

What is ERP?  In the most general terms it is defined as Enterprise Resource Planning system.  Note the word Enterprise.  Here is an important key.  What is an Enterprise?  How big does a company have to be to qualify as an Enterprise?  It really is not a size issue, rather it is a functional issue. 

The functionality of any ERP solution should be matched to the organization.  For example, without knowing anything else, a two person business (small business) would probably function well with QuickBooks or equivalent Personal Computing (PC) program.  An installation of a global SAP solution is not generally needed.  Larger corporations typically fall into a Tier-1 solution platform, which include companies like SAP and Oracle.  Mid size companies should be looking for a Tier-2 solution, like VAI’s S2K solutions.  Small to mid size companies really have to take their time to see if there is a good fit between their challenges and available solutions.  

A solution may work, but may be so rigid in process that your staff cannot function.  The software works, but there are so many screens and steps to process an order that you cannot ship anything on time.  Or just as bad is the solution that has no checks and balances and really would not qualify as an Enterprise solution.   Enterprise solutions integrate the entire organization.

We are talking about an Enterprise solution.  The premise is that your organization has separate departments and/or is separated into functional roles.  This is where the right solution will fit your business.  Often a critical decision must be made and that decision needs to be made early on.  Do we mold our business to the software or modify the software to match our business? 

Resources needed.  Sometimes the software is great, but the Salesrep rushed the process and underestimated the resources needed to make a successful implementation.  This leads to a lot of frustration and finger pointing.  The Salesrep figures the company should know what to expect and the company figures the Salesrep should have explained the process in more detail.  Any company making such a decision that will affect their entire Enterprise (ERP Solution here), should have an advocate to ensure that the right questions are asked by both sides. 

I cannot imagine any solution provider would want to have an unsatisfied customer that will go out of their way to spread the bad word about their experiences.  And what customer would want a bad implementation?  This situation may have been a good fit initially, but the implementation team did not have realistic goals.  Did all levels of the organization have a say and buy-in during the selection process?

A successful implementation needs adequate planning, a fair budget, reasonable time frame, and industry expertise.  A team approach works best.  You cannot just have the Technology Department install some software on a software and client applications and expect everything to work well.  Enterprise solutions integrate the entire organization, so the entire organization must be included in the solution.  You cannot just force feed new anything on your workers.  Success comes from an integrated approach where everyone feels they can contribute.

Many times a new solution is an opportunity to document work flows inside and out of an organization.  If it has been a while since the last change or this is the first implementation the process can be enlightening.  It is also going to take some time and should be in process before making your final selection.

How would you expect a solution to work if no one knew what they were trying to fix?  Dolvin Consulting works with your organization to find your solution that addresses your challenges.  We often see cost breakdowns of 25% Software, 25% Hardware, and 50% implementation.  This is above and beyond the time needed to document your processes so that an effective Return on Investment (ROI) calculation can be estimated and benchmarks created to ensure you are on track to actually achieve the expected returns.  It takes some time to look at your business operations to determine what efficiency can be achieved or expected with a new solution.  It usually takes a fresh look, because often times you do not know what you do not know.

We cannot promise you anything.  In fact, no one can, but we do our best to leverage our industry knowledge and contacts to help connect your challenges with the right solution.  We look to see what others in your industry are doing.  We do not try to reinvent the wheel.  We work with your team to find the best solution for your budget. 

We do not know who you are so you need to contact us today to start the conversation.  We are looking forward to talking with you about your challenges.

1 comment:

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