ERP Success or Failure — 90% responsibility goes to the Company who uses ERP
Strategic Transformation Leader | ERP, IT & Enterprise Solution Project Manager | Master Business Analyst | Management Consultant | Driving Innovation Through Process Optimization, Culture Development, and Automation Technology | 01 October, 2019 (Tuesday)View 1444
ERP Vendor is not the owner of the project
If an ERP implementation fails, the company will suffer a great loss and the business will get disrupted. But, for the Vendors, it’s just an addition to the number of failed projects.
Whether the ERP project provides expected result or not, Vendors always make their money. It’s the Client Company who has larger part to loose. The risk is taken by the Client, not by the Vendor.
Therefore the Client must be able to take ownership of the project seriously. Vendor cannot own the project even if the Client wants.
ERP Vendors cannot manage Client’s people
In order to implement ERP successfully, the culture and behavior of the people in the organization must be studied and understood properly. This is required to balance the change management, configuration and customization for ERP. Having some interviews and meetings with people are never enough to complete this job.
With the expensive daily rates, you (the Client) cannot afford the Consultant (from Vendor) to spend months to understand your people’s culture and behavior. Therefore you need to take ownership of your own change management. You need to assign the right functional people on the ERP project who is smart enough to understand how an ERP system works.
In almost all cases, vendors complain that they didn’t get proper support from the client. These complains comes when the project is already failed. In reality, vendor can never manage your people, they cannot even manage to get all people in a 30min meeting. How will they change your people’s mind?
ERP Vendor cannot change Client’s Process
As vendor cannot change people, they cannot change process too. When the process in ERP solution and the process in practice do not match, you will have to either customize the system or change the existing way of working. Customizing the system may help until a certain level, after that even customization will not be possible! In that case, the existing process must be changed.
Changing a process requires extensive knowledge and observation on the existing way of working. With the expensive daily rates, you (the Client) cannot afford the Consultant (from Vendor) to spend months to understand your process in detail. Sometimes vendor follow shortcut and propose a new process without knowing all the scenario; this will definitely be responsible for ERP failure. Therefore you need to assign the most capable functional people as Business Analyst who will get training on the software and already have the knowledge on process in detail. Only they can provide the balancing solution between Customization of software and Change in process.
The Client (who uses ERP) is its own savior
As the People side and Process side can never be controlled by ERP Vendor; the project of ERP implementation cannot be managed by anybody other than the client organization who will use ERP.
External people cannot set your strategic goal and plan. They cannot monitor if the ERP system and processes are followed every day or not. It’s client’s job to control their people, understand their issues and provide the best possible solution. Therefore it’s the Client who is controlling their ERP destiny – success of failure.
In order to implement ERP successfully, the client must assign its best people to the ERP project as Business Analysts. They already have business knowledge, they just need few days of training on how ERP system works. If you (the Client) think you don’t have good people inside, you are wrong, how you are running your business then? In a very worst case scenario, if you don’t have capable people to be the Business Analyst, then hire permanent employees as Business Analysts, don’t rely on ERP vendor. Vendor is just to train your Business Analyst team on the software.
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