More and more companies are seeing the advantages of integrating all of their data and processes into a single, unified system. Enterprise Resource Planning (ERP) systems are the method of choice, and the most popular provider is SAP.
According to a survey conducted by Forrester Research, only six percent of 500 companies surveyed considered their ERP systems effective, while 79 percent said they were not effective or only somewhat effective. And five of the top ten Corporate Information Technology Failures cited by Computerworld involve ERP projects.
Here are five tips for successfully launching ERP at your company:
• Don’t try and implement it during your busy season. People need time and training to successfully implement ERP. It’s best to launch the program during your slow season so people can get a feel for it. Hershey learned this the hard way when they tried to launch SAP during Halloween. The new system was implemented so poorly that huge customers like Walmart simply ordered from Hershey’s competitors because they weren’t getting their orders. This resulted in a 19% drop in that quarter’s earnings.
• Put your best people on the job. Make sure that your implementation partner is giving you their best people. Request to see resumes, to make sure their consultants aren’t there for on-the-job training. ERP implementation requires a highly competent (and experienced) team on both ends, so you’ll need to be teaming your best people with theirs.
• Top management has to be involved with the project throughout. Top leadership has to communicate their vision for the project. Another company can’t just guess at your business objectives and implement changes. The project needs full support from leadership, and sustaining communications on the business reasons and benefits that the change will bring. Getting employees to embrace the project is critical to its success.
• Mistakes are costly. Customer orders aren’t processed, bills aren’t paid and bankruptcies sometimes follow failed implementations. This is one of those projects that you can’t afford to get wrong.
• You can’t just do things the same way. Many companies run into a lot of problems when they want to customize ERP. If you’re going to make the switch to ERP, be prepared to start looking at processes through the ERP lens. ERP is not a vehicle to run your current system the way it’s always been run.
This isn’t an IT project—you have to involve people from across the business for it to be a success, and the launch date is just the start. If done well, ERP can be hugely efficient and valuable to a company. If done poorly, it can be an extremely costly mistake that extends far beyond the cost of the project.
