After 20 or more years of implementing ERP systems, we tend to carry our own opinions about what makes projects failures… or successes. But it’s always good to hear what other experts have to say, so today we’ll reprise the thoughts of Eric Kimberling, Managing Partner of Panorama Consulting Solutions in a recent article entitled “Navigating the Three Stages of ERP Failure.”
Kimberling offers his three failure benchmarks as “stages” though as he admits, they don’t necessarily happen in the same sequence each time. Still, they tend to represent most of the significant causes of project failure.
1.) The ill-advised implementation plan. Kimberling notes that this is a frequent one, and adds “Too often, ERP vendors and sales reps use these plans as selling tools rather than planning mechanisms, which leads to unrealistic expectations and, ultimately, disappointment. Unfortunately, poorly defined implementation plans entail more than just mere disappointment; they also ultimately lead to corners being cut and resources being diverted from the critical success factors most important to ERP success.
2.) Uncontained organizational resistance. Here he points out how most executive teams simply don’t fully appreciate, or recognize, just how difficult organizational change management will be until they are in the midst of their implementation. They assume employees will happily embrace the change, regardless of the impact upon them. And, he points out, “most organizational resistance is very subtle, non-intentional and rooted in non-malicious causes that can and do undermine ERP success.” The result too often is failure to engage in meaningful business process reengineering which in turn can result in “over-customizing” the software.
3.) Technical and software myopia. Finally, Panorama points out, sometimes consultants are too often focused on the software functionality, instead of “holistic business processes.” This, we also find in our own practice, is a common feature of failed projects we sometimes are called in to rescue. The process must start with a thorough process analysis, must be led by qualified and experienced analysts and must be implemented by both consultant and client teams with a consistent focus on the business problems being solved – and not the technology for its own sake.
The mistakes and failures noted above don’t always occur, and even when they do, they may not all occur, or occur in this order. But project managers are always cautioned to be vigilant in recognizing them throughout project inception, design and execution. They are easy to succumb to, especially when clients are too interested in rushing through the process, checking off their lists of ToDos, or otherwise failing to give these critical ERP implementations the full attention they deserve.