Manufacturing Insights

An ERP blog from MAX

Top 4 Reasons ERP Implementations Fail

Posted by MAX on Oct 8, 2014 9:00:00 AM

fail-stampERP implementations are complex projects, so they can succeed or fail based on a variety of complex factors. However, driving to the root cause of ERP failures often points to one of these problems. Help ensure a successful ERP implementation by avoiding these common problems. 

Neglecting to assign dedicated resources

One of the biggest problems ERP implementations face is the assumption that the implementation team will complete the project in their “spare” time. Most employees today are already overburdened. There is no spare time. Adding the necessary implementation tasks to an already full schedule is a recipe for project failure. Either tasks will not be done on time, they will be done poorly, or they will not be done at all. The best-case scenario with any one of these outcomes is that the project will be late. The worst-case scenario is that the project will fail utterly. 

Never attempt an ERP project without at least some people who are dedicated to the project full time. If that means hiring temps to cover their normal jobs, it is worth the expense to ensure project success.

No management involvement

If top management doesn’t have day-to-day involvement in the project, it is clearly not a company priority. If it’s not a company priority, the project will fail. Every ERP project needs an executive sponsor who oversees the project and a steering committee comprised of several executives who monitor the project and arbitrate cross departmental issues. 

No matter how strong the project team leader may be, the ERP implementation is doomed to failure without strong executive support. The executive steering committee should be involved in the decision to buy a new ERP system, and they should be involved in the plan throughout the project. 

Lack of training

Many companies skimp on training, either because they spent more of the budget on the actual software than they had planned to, or more likely because training was never included in the budget. “Train the trainer” is an educational method that works, but it still requires multiple trainers from various departments to ensure a complete understanding of the system. 

People generally only retain about half of what they learn, and that percentage drops when they are learning something completely new. Relying on a single individual to train people outside the trainer’s sphere of expertise ensures that the users will be inadequately trained and never make full use of the ERP system’s capabilities. 

If you can’t afford to send all users to formal training, at least send someone from each department. In addition, the core team should attend all available training, to be certain they can adequately plan cross-functional activities and processes.

Skipping steps

If the project starts to fall behind schedule, often due to lack of resources or inadequate training, the team may be tempted to skip steps to stay on schedule. This is a very bad plan and puts the company at risk when it does go live. 

The steps the team is most likely to skip are often the most crucial. Cleaning and validating data for import is an imperative for ensuring that the new system starts with a solid foundation. Skipping or shortening the conference room pilot is another poor decision with serious ramifications. 

Companies perform the conference room pilot for three simple but essential reasons:

  • Ensure that the system works as expected

  • Ensure users have been adequately trained to perform their jobs on Day One

  • Ensure that data has been entered or imported correctly 

Give your ERP implementation the best possible chance for success by avoiding these four factors that might otherwise doom your implementation.

 

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Topics: Implementation

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