An ERP system touches just about every department within an organization, and the implementation risks are real.
However, it is common for those involved in ERP project management to take shortcuts to save money or get back on schedule. There are some areas where cutting corners during ERP project planning can spell disaster.
When senior management is not on the same page, it is guaranteed no one else will be. That’s why senior management alignment is essential to a successful ERP project. Everyone on the executive team must support the project business case, become educated on key ERP concepts and principles, and have realistic and shared expectations about benefits, scope and resource requirements. Above all, they must understand their roles in making it happen.
Consensus is also important in the design phase, when ERP project managers should take the time to gain consensus on how business will be conducted with the new system. Their primary tools are the “To Be” process maps that depict the process steps, policies, procedures and software use in the workflow. The maps are the deliverable that drives software setup, testing, work procedures, training and just about everything else.
Project leaders should strive to sustain this level of communication since it is usually the first thing to suffer when a project falls behind schedule. Taking steps to continually involve stakeholders can lead to a better design, quiet naysayers and foster user acceptance.
Often, the vendor’s promise to transfer software knowledge to their customer’s ERP project team gets lost in the shuffle. Clients that don’t understand the product are less proactive in software design, and they are unable to train others, support the system, and leverage the investment once the consultants walk out the door. It all adds up to potential quality issues, unrealized benefits or permanent dependency on expensive consultants.
Testing is another area where many ERP projects fall short. Test cases should cover approximately 95% of a company’s business-process scenarios. An ERP system is unforgiving; if you test only 80% of it, the other 20% can come back to bite you.
ERP project management pitfalls
Solid ERP project management is a prerequisite to a successful ERP implementation. Here are some common ERP mistakes to avoid:
1.) Consultants are running the project
Consultants should provide project-management guidance and support, and they should jump in when necessary, but they shouldn’t be in charge of the ERP implementation. The client must have an internal project manager driving the project.
That person must be a creditable manager from the business function, not IT. Important skills include the ability to lead, communicate, plan and organize. The project manager should also be able to work well with people at all levels of the organization and across functional boundaries, while using a “tough love” approach when necessary.
2.) The project manager is the “lone ranger”
ERP projects are simply too big and too important to delegate to one person. The project manager is responsible for day-to-day activities, but the consulting project manager, consulting firm directors, client senior management, executive sponsor and IT manager all have important project-management roles.
3.) The project is ill-defined
The project plan must be thorough, and it must be something that the steering team and project team can believe in and support. Key deliverables include objectives, scope, assumptions, risks, project team and responsibilities, resource commitments, detailed schedule and budget.
The project should also be kept under tight control. Each team should maintain an issue / action- item list, a monthly project calendar, a weekly progress report, and a report of hours spent on the project. Prepare a weekly schedule of hours budgeted for each consultant.
4.) Unresolved issues and slow decision-making
ERP project planning involves hundreds of issues and decisions. The longer they fester, the longer the project takes -- and the more rework is needed.
5.) Implementation methodology matters
If thinking about a “rapid ERP implementation” approach, make sure it won’t hamper the ability to achieve the expected business improvements. This means understanding the potential risks of eliminating or minimizing steps in the “traditional” approach. Those deliverables are there for good reasons.
Shoddy ERP project management -- cut corners, incomplete planning and unclear leadership -- can spell ruin for an ERP implementation. If project managers follow the above steps and avoid tripping over common leadership mistakes, ERP implementations can run smoothly and reap benefits for years to come.