Your business deserves to be happy with your ERP, especially with the cost, time, and effort required to put one in place. But many businesses become dissatisfied with their enterprise solutions due to a lackluster implementation or insufficient optimizations made to the system post-go live. So how can you protect your business from implementation failures and unmet expectations in order to achieve long-term success with your new ERP?
Your business deserves to be happy with your ERP, especially with the cost, time, and effort required to put one in place. But many businesses become dissatisfied with their enterprise solutions due to a lackluster implementation or insufficient optimizations made to the system post-go live. So how can you protect your business from implementation failures and unmet expectations in order to achieve long-term success with your new ERP?
In the age of information and automation, businesses must have a robust accounting solution to compete and achieve growth goals. Enhanced insights and analytics, alongside the automation of manual tasks allow for organizations to elevate their operations and free up their employees for more value-added work. However, despite the benefits of implementing a new ERP, businesses can be left disappointed with their software for a wide variety of reasons including inflated expectations and burnout.
One major reason businesses become dissatisfied with their ERP is the difficulty of implementations, often leading to burnout before the system is even live. The implementation process is taxing and will likely lead to some demanding weeks at work. If you do not have the proper resources or support in place, participants can become frustrated by sudden obstacles and unmet expectations.
Once your ERP is live, your business is now dependent on the solution as a single source of truth and operational centerpiece. However, you likely won’t have all the functionality you wanted in place yet and not everything will be perfect, because there is still much important work to be done in future phases. But if everyone is already burnt out and have lost faith in the system, resentment can build quickly and then the crucial optimization work doesn’t get done. This can sometimes even lead to organizations having to undergo another ERP transformation, even if their current system could have met their needs. Buy-in and satisfaction are essential for success and can make or break a digital transformation.
“One company’s ERP failures could be another’s success.”
As previously mentioned, one of the biggest factors leading to ERP dissatisfaction is overpromising in phase one. In many cases, a “failed” implementation comes down to perception and falls short when stakeholders expect the system to be “firing on all cylinders” at go-live. Sometimes software salespeople can get us very excited about all the amazing potential, but we can’t expect it all to be there on day one. We need to establish a realistic roadmap early on.
Setting realistic expectations for go-live starts with proper phasing of your implementation. Specifically, narrowing the scope during phase one. It is best practice to limit your scope during the first phase of the implementation, focusing mainly on achieving your business’s minimal viable product (MVP). Experts recommend only including the most critical external system integrations in your initial MVP go-live. Doing so will reduce the number of potential problems at cutover and ultimately the risk of a failed go-live. Once you have officially adopted the system and are operating effectively with MVP, your phased approach will have set the stage for the next steps, as well and will position your team to succeed in ongoing optimization efforts.
Most of the risk in an ERP project revolves around the people accepting this new application and modifying the way they’ve been doing things for years. Frankly, it’s not easy to change behaviors. During an ERP transition, employees are uprooting their day-to-day processes for an entirely new (and hopefully improved) operational basis. Those employees have likely been operating the same way for years or even decades, and such a change to their day jobs can be more than a little uncomfortable. It is crucial to initiate change management with internal users before beginning the implementation, and then take things in bite-sized chunks. The earlier you start, the better! Properly preparing your employees early allows for decreased pushback and increased acceptance of the new system over time and at go-live.
One of the most important aspects of change management is User Acceptance Testing. Actively involving your users in testing puts your team in a position to take accountability for their processes and ownership of how the new application works. Key users should be in the room to help document current business processes and determine how those processes can be adapted in the new product, or where they can be changed to fit within best practices for the new system. Including key users in these sessions encourages system adoption by valuing their input and ensures there won’t be frustrating surprises after go-live. Regardless of how perfect the product may be, if no one wants to use the system, the project failed.
So, when should you start preparing for a phased approach to ERP implementation and optimization?
The easy answer is as early as possible. The earlier you develop your approach to software implementation, the better. We recommend beginning the discussion as early as the software selection phase. Even if you do not have a solution selected, you can still begin looking at your functionality requirements and determine what will be critical in phase one, and what can be pushed until after the system has gone live. Focus on areas where functionality is crucial for operations to continue uninterrupted post implementation.
Be sure to also communicate expected timelines to your vendor. They can provide expert insight on how realistic your plans are, the expected time commitment during each phase, and more. Consistent communication also ensures the vendor is informed on major events within your company and how those circumstances might impact your team’s workload capacity. If you determine a need for additional capacity during certain phases, begin planning how you will backfill your staff, whether that be with a new hire or bringing in an independent consultant like ERP Advisors Group.
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Determining how to phase your approach can be complicated. Finding the right balance between including key functionality in the first phase and not including too much for your team and the vendor to handle is critical. Ideally, you should include the least amount of functionality in phase one as possible, focusing on financials first. Ensuring your core financials are in place will direct each subsequent phase, allowing your team and vendor to strategically build upon the live system. With every new process that you add in phase one, the level of complexity grows. That goes for additional phases as well; include what you need and what you can handle and nothing more!
As the biggest trend in technology over the last few years, artificial intelligence has moved to front of mind when purchasing new software. However, it is not reasonable (yet) to demand AI functionality in your initial ERP go-live. While it is important to consider it and know how your organization wants to utilize it, AI should not be critical in getting your MVP live.
Still, educate yourself on your vendor’s offerings and new developments. The technology is evolving daily, and beginning conversations with your vendor about their offerings can place your organization in a position to take advantage of the latest tools at the right time. Some vendors have even developed out-of-the-box AI solutions! Be curious and ask questions to help determine the pace for integrating additional tools into your operations.
ERP implementations and optimization can be one of the toughest obstacles a project sponsor will face in their career. Regardless of how well you plan, these projects are incredibly complex and almost guaranteed to present problems somewhere down the line. However, there are key best practices you can follow during a system optimization process to reduce the pressure on you and your team.
Most importantly, do your homework! Make sure that you, the stakeholders, executives, and your entire team are all ready to undergo these efforts. Under no circumstances should you rush into an ERP implementation if your team is unprepared. And don’t jump right back into optimization unless your team is adequately set up to get back into the thick of a complex software project. The worst thing you can do is add to their burnout.
“Most implementations fail before they even start.”
Additionally, communicate, communicate, communicate! Prioritize aligning your entire team strategically and be ready to openly discuss the project as issues arise. Being honest if something is not right, both in internal conversations and those with your vendor, can ensure your project doesn’t go off the rails. Open and honest communication can reduce your risk of a failed project and is one of the most important parts of any major enterprise project.
The implementation of your software is a massive undertaking for your organization, and it is important to treat it as such. By properly setting expectations and approaching the project with intention, you can position your team to succeed through implementation and into optimization. If you are looking to undergo an ERP implementation or to optimize your existing system soon, we can help! Schedule your free consultation today to discuss your plan with the experts at ERP Advisors Group.