For the trained eye, the early signs of a catastrophe can be intercepted and dealt with before everything flies off the rails. All it takes is a healthy, proactive attitude to your business ventures. If all you do is react to the world around you, you’ll never get ahead of the curve.
ERP implementation is complex and can go wrong but a great recovery can still be a success. You could be sponsoring an ERP implementation that has gone off the rails, or be starting to sense things might turn sour. Don’t worry, there’s still time to recover the situation and bag a successful delivery!
The key to overcoming these obstacles lies in adopting effective recovery strategies. So I thought I’d share my expertize when it comes to successfully navigating the path to ERP system stabilization and optimization.
First, you need to recognize that action is needed. The status could already be flashing red and everyone could be running around like there’s a house on fire. However, the warning signs can often be a lot more subtle. We call these ‘watermelon programs’ – seemingly all green and wonderful but hiding a whole load of red once you get into them. We recently reviewed a complex SAP S/4HANA implementation at one of the UK’s leading utilities companies. There were several causes for concern.
Ineffective resource and time management
The program schedule was constantly replanned due to the inability to meet key milestones. This was exacerbated by a lack of skilled resources to understand how to handle the situation. There was poor architectural oversight to govern design questions, and the program was basically stuck in design – unable to progress into a tangible build phase.
An over-reliance had built up on ‘work arounds’ within the overall ERP system implementation solution. Tactical solutions were needing to be developed in the business to address the delays in implementation.
The failure to demonstrate progress and manage expectations resulted in disengagement with the ERP program across the stakeholder community. Business leads became frustrated, staff turnover increased and tactical projects took priority. We’ve all seen this situation where a program goes out of favor and there is a general lack of faith that the program will ever deliver.
Indecisive sponsorship, unclear accountabilities and poor risk management meant that there was a general inability to adeptly overcome these issues. By this point, however, things had started to decline dramatically.
The next step was to understand the root causes of the issues. There is no point trying to fix superficial problems without getting under the skin and fixing the real cause.
Losing sight of the end goal
By their very nature, ERP implementations are complex and lengthy programs of work. While ‘in flight’, there may be changes in the senior leadership team, changes in the strategic goals of the business or unforeseen external events. Therefore, the original objectives of an ERP implementation can become uncertain and ambiguous. The absence of a documented and updated vision can be a cause for problems. Without this, stakeholders and partners may display different, and sometimes contradictory, conclusions regarding the goals and direction required.
Trusted partnerships and a one team collaborative approach are also key. It is crucial that a cohesive and trusting relationship is maintained between the business and their chosen ERP Systems Integrator. When accountabilities are blurred or slippage in key delivery milestones occur, tensions can develop between partners and ‘finger pointing’ is inevitable. We worked with one of the UK’s leading defense companies to transform to SAP S/4HANA, and one of the key reasons this program was delivered on time was the co-location of the team and the mantra of ‘leave your badge at the door’.
Programs of this magnitude require a strong business-led sponsorship and robust leadership governance structure. If this is under-represented, the outcome of the ERP technology implementation is unlikely to match the expectations of the business change objectives. Also, customizing the ERP implementation to fit existing ways of working is very tempting, however, this can lead to an unexpected increase in cost and raise tensions between business and technology stakeholders. The program should focus on exploiting the configuration functionality offered by the ERP system and keep any customization to a minimum.
The success of an ERP implementation depends greatly on a clear and comprehensive corporate data model and a documented enterprise-wide architecture. These underpin the data migration and system integration strategy.
Failure to secure these prior to embarking on ERP system implementation will unnecessarily result in ongoing systems integration challenges, the implementation of ‘point solutions’ with no strategic focus and extended data migration and testing activities.
Getting back on track
Now you understand the real causes of issue, you can execute the recovery. Act decisively. A good, fast recovery can still lead to a success for the ERP system.
A well-defined recovery plan is crucial for getting an ERP system back on track. The plan should outline specific actions, timelines and responsibilities for addressing the identified challenges. It is essential to involve key stakeholders, including the senior leadership team, project managers, end-users and any external vendors in the development of the recovery plan to ensure buy-in and collaboration. We ran a recovery for a leading UK retailer, who was implementing Oracle Fusion as part of an HR transformation. Spending time on getting the recovery plan was not only viable, but also accepted by all stakeholders that it was essential for getting the recovery off to a fast start.
To make sure this plan is complete and can be executed effectively, it is worth considering engaging external ERP consultants or specialists to provide valuable insights and expertize during the recovery process. These professionals can conduct an independent assessment of the situation, offer recommendations and guide organizations in implementing best practices. Their experience in ERP recoveries can help accelerate the stabilization process and mitigate risks.
One common challenge in a ERP system implementation is resistance to change from end-users. To address this, organizations should invest in comprehensive training programs and change management initiatives. Training should go beyond system functionalities and focus on how the ERP system benefits individual roles and the organization as a whole. Clear communication about the reasons for the recovery effort and the anticipated benefits will help gain user acceptance and engagement.
ERP recovery is not a one-time effort but an ongoing process. It is crucial to establish monitoring mechanisms to track system performance and user satisfaction. Regular assessments will identify areas for improvement and enable organizations to fine-tune their ERP system to meet evolving business needs. Additionally, staying up to date with ERP vendor releases and updates can provide access to new features and enhancements that can further optimize system performance. By embracing a mindset of continuous improvement, organizations can adapt to changing business requirements and maximize the value of their ERP investment.
An ERP system implementation is often a critical journey for an organization. Given their complexity, recovery is often needed to address challenges and realize the full potential. Recover well, and you will still claim success and experience the benefits that your organization deserves!