ERP Failures

I’ve worked with companies to help prevent large ERP failures, and generally see some variation of the following:

1) An ERP implementation is regarded as a technical project, and left to the IT folks. These folks are usually well intentioned, but with ERP in particular, business process is a more critical component than the actual technology. Key users and stakeholders need to be involved from the outset, and the project managed according to business results and drivers, not technical deliverables.

2) Companies act as “absentee landlords” and let their implementation firm run the show, expecting them to show up with a working system some number of months later. Generally, “something” will be produced by the implementation firm, but it will take 3 times as long, and not meet the needs of the end users.

3) A defined decision making process is not in place. For and ERP to finish on schedule, tough decisions on scope, processes, and schedule must be made. In many environments, making the wrong decision is punished so onerously, no one wants to make any decision. Implementation firms often don’t help this process, since a long decision cycle adds billable hours.

4) There’s an inherent conflict with implementation firms in that each hour that a project drags on costs the client money, but increases the implementation firm’s billings. To assuage that conflict, clients should have a streamlined decision making process, and maintain project management and ultimate oversight of the project. There’s also no shame in bringing in outside expertise (a role I frequently fill) to keep all parties honest. When burn rates can run into five figures per day, this is usually very cost effective.

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