Posts Tagged ‘5 Common ERP Mistakes’

oopsA recent article from Panorama Consulting hits the nail of ERP implementations squarely on the head, confirming our own observations of many years.  They provide the advice we would urge all small businesses to heed carefully when tackling their own implementations.

As Panorama notes and we concur, small businesses are often not equipped to deal with the challenges and complexities of ERP implementations.  The lack of bandwidth, the already-too-busy staff, the often minimal or non-existent IT staffs… all conspire to make it a challenge.

All too often, clients (understandably) want to push the onus on the consultant or provider – and while that’s fine for the revenue stream of folks like us, it does a disservice to the customer, who really needs to be taking ownership of their new system.  So with that said, here are Panorama’s “5 Most Common Mistakes”…

  1. Mistakenly thinking that their ERP implementation will be simple and cheap. This is never the case, but it’s sadly underestimated during the sales phase – too often by both provider and customer (who wants to hear it will be cheap and painless) alike.  It’s often made worse if the business benefits don’t match the expense, or were not considered in the first place.
  2. Unrealistic implementation expectations. Clients often don’t realize the resources necessary to make their projects successful.  They often neglect to define and reengineer their business processes – when in fact, an implementation is the perfect time to do just that.  All in all, it is simply too important to match expectations to reality, to safely ignore.  If your provider or consultant isn’t cautioning you in this regard, you should caution yourself (and perhaps have a longer conversation with that provider).
  3. Failing to focus on the future state of the business. The first two items lead to this third one, notes Panorama.  Since the point of ERP is to aid a company in its growth, it is critical to “adequately define business processes and requirements that will take them into the future, rather than simply ‘paving the cowpaths’ and automating things as they are today.”
  4. Neglecting organizational change management. Related to the item above… change is hard even for the best, most nimble businesses, regardless of size.  Training, communications and organizational readiness – done well – are at the heart of every successful ERP implementation.  This is even truer for the smaller business, where these traits are often not already in place.
  5. Outsourcing the ERP implementation to ERP consultants. Every small business we’ve ever seen runs lean already.  Think about it: does your company have too many people around?    So it can be tempting to let your ERP consultant do pretty much everything.  Tempting, but dangerous and decidedly not in your own firm’s best interests.  While it’s good for the provider’s short-term cash flow, notes Panorama: “your project will not succeed without a minimum level of involvement and commitment from your own executives and team members.”

We concur fully with Panorama’s list, and would urge every small business to take these lessons of common mistakes to heart – before they being their ERP implementation project.  ERP can be a lifesaver to the growing company – but only if tips like those above are heeded and taken to heart.

Read Full Post »