Survived the Journey of ERP Implementation

Hence you want to run the ERP system. As an administrator, you should know that it is difficult to control ERP projects.

Why is this and what can you do about it?

Let’s take a specific position. Bob contracted with ERP Consulting to run the ERP system for his company. The ERP software package was selected from a major vendor. Bob's organization has certain system requirements, so customization is required.

The consultant estimated that the system would take 16 months to implement. Panorama Consulting has released a 2016 report on ERP systems and enterprise software and states that the average time to implement ERP is 16 months.

Bob consults with the consulting firm and finds that they have a good reputation. He contacts other users of the software package and finds out that the software is considered adequate, though no one is in love with it.

The cost of an ERP system is usually $10,000 per employee. This is a strict rule, but if Bob's 50-man company happens as expected, it will probably pay $500,000. Another cost estimate comes from the 2016 Panorama report mentioned above, which averages 6.5% of annual revenue. Suppose Bob's company earns M 6M in revenue per year, which costs approximately 000,400,000.

Unfortunately, according to the Panorama report, there is a 43% chance that the project will fail or end in a situation where no one knows whether the project will be successful or not. In other words, the implementation of ERP is a very high-risk project.

Much may change in 16 months. First, there are changes in the company business. Some changes, such as regulatory, cannot be ignored or postponed, so the project may be forced to add new features and replace other features in the middle of implementation. This can seriously affect the schedule and cost. In software, change is done after breaking the design and implementing a complete re-write or hacker-like solution (called sludge in the industry) by adopting an architecture. These improvements work but create difficulties for subsequent programming. All of this has led to an increase in time and budget.

The project team is likely to undergo a lot of changes in 16 months. The inevitable worries of the employees take place within the consulting firm itself, with the resulting promotion and reorganization of the staff, affecting the consultant’s project team.

This means that the project team working on the system in the later stages will be completely different from what it started.

During contract negotiations, some advisors play the lure and switch game by providing an A-class team, which then replaces the B or C class team when they receive an A- for another marketing attempt. Teams are needed.

Bob's problem is how does he handle all this?

They have no way of really assessing the new members of the project team and should take the word of the advisor to the best of their ability. As the months go by, the project team gets harder on the work, but Bob can’t say if there is a progress report. There is usually nothing to test whether the system is more or less gone.

Finally, over the course of a year, he finds some software that he can evaluate. If this is not satisfactory at this point, what options does it have?

He has been making progress payments at high advisory rates all these months. He is now dissatisfied and if the project is killed it will throw the money down the drain.

This is not quite an option, so managers usually try to track things back. Bob can fire advisers and delegate his work to others. These new advisors can pick it up and delete it, but they are working with unwritten code and are almost unthinkable. Most of the time, the project team that manages a project recommends the whole R.

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