As organizations seek new enterprise solutions to meet evolving business needs, many are undertaking what can seem a daunting process: enterprise resource planning (ERP) system implementation. The number one pitfall with ERP implementations may surprise you, though. It’s a function of people, not technology. According to Deloitte, 82% of CIOs cite resistance to change as the top barrier to ERP implementation. ERP implementations are disruptive because you’re asking people to change how they work. So, you’ll have to sell them on it by emphasizing the benefits. A modern ERP system can solve business problems, but successful deployment requires getting users on board and building consensus for new ways of working.
In other words, ERP project success requires effective change management. The good news is that next-generation ERP systems offer higher levels of efficiency and integration than legacy systems. The challenge is that you have to communicate this to stakeholders in a way that resonates.
5 Tips for Smoother ERP Deployment
Here are some tips that can help you address change management issues effectively for a quicker and easier implementation:
1. Focus on what makes the organization unique.
Every organization has processes in place that people use to conduct business. That’s true for companies that manufacture musical instruments, nonprofits working to save rare bird species, and every other type of organization. But sometimes, employees get so focused on the process that they lose sight of the mission. It may sound basic, but remembering the services that make the organization unique — not the processes — can be helpful at the outset of an ERP system implementation.
2. Stick to the standard ERP implementation.
As cloud-based ERP solutions grow in number, they become more specialized. The musical instruments maker and bird-saving nonprofit can each access ERP products that suit their sectors. Keep in mind that different organizations within a sector are likely to have similar integration needs, and there’s value in that commonality. Also, it’s better to tweak business processes than customize the software. For example, we found with one of Unit4’s public sector customers that altering people’s work methods, instead of altering the ERP software cut implementation time in half.
3. Ensure all key stakeholders are included in project work groups.
ERP implementation projects are typically led by IT, which may or may not be familiar with all affected business units. It’s critical to make sure every stakeholder who will be affected gets a chance to provide input and receive updates. Failure to do so can result in significant delays. In one ERP deployment, a stakeholder group was identified toward the end of the project, and going back to accommodate their needs delayed the go-live date by eight months. So, double-check to make sure all relevant parties are looped in.
4. Map out business processes and improvement opportunities.
An ERP deployment is a golden opportunity to rethink business processes. Mapping out processes and identifying potential efficiency gains can be a galvanizing event, bringing team members together around the shared goal of greater productivity. It’s also an excellent opportunity for the team leader to tell stakeholders precisely how the implementation (and applying the vendor’s standard approach) will make their jobs easier by removing unnecessary steps and eliminating the need for manual interventions.
5. Choose a vendor who is familiar with your domain.
As noted above, the days of one-size-fits-all ERP systems are over. In addition to selecting a cloud-based ERP software that is a good fit for your organization, ensure you engage with a vendor with experience with your sector. Ask potential vendors the right questions to understand their focus area. That way, you can benefit from accumulated knowledge they’ve gained through multiple deployments, speeding time to value for your organization. A manufacturer’s implementation won’t be the same as a nonprofit group’s, so find a vendor with the relevant industry experience.
Leading With Change Management in Mind
ERP implementation leaders tend to focus on the technical aspects, which is understandable since they apply technology to streamline processes, eliminate manual interventions that don’t add value, and create more efficiency overall. However, it’s essential to remember that since an ERP implementation alters how people work, the change management portion of the project is critical.
During the pandemic, we saw many organizations operating in “emergency response” mode, rapidly accelerating their digital transformation efforts to respond to immediate business challenges. We have yet to see significant adoption of these next-generation technologies, though. This suggests there’s an opportunity for technology leaders to take a step back and assess how their ERP system fits into their IT and business strategies holistically.
Remember, the time you spend upfront looping in key stakeholders, building consensus for your implementation strategy, and gaining buy-in on the value of the new ERP system isn’t a distraction from the technical components of the implementation. It’s a vital phase of the project in its own right. Skillful change management will result in a smoother, faster deployment if handled correctly.
Featured Image Credit: Photo by Mikhail Nilov; Pexels; Thank you!