Investing in an cloud ERP solution is one thing; achieving a satisfactory return on investment is quite another. In most ERP installation projects, the goals are met outside the intended timeframes. To evaluate a project’s success, you must first set the organisational goals you want to achieve via the project and then specify the success criteria.
An ERP deployment includes setting up your company’s procedures, customising and integrating other systems, migrating your master data to the new system, creating user roles and permissions, and teaching your employees to utilise them. Before the advent of cloud-based software, another major undertaking was installation.
Poor selection processes and ERP functionality aren’t to blame for ERP failures; the implementation process goes wrong. This difficulty may be solved by simply preparing your firm for the challenges ahead of time.
To assist you in better recognising and preventing ERP project risks, we’ve outlined some of the most common ones:
1. Why ERP Implementation?
In the absence of a clearly defined goal, everything might appear acceptable. A team with well-defined goals has a sense of purpose and can devote the necessary resources to achieving those goals. As a means of assessing one’s own and one’s organisation’s performance, it serves as useful. A sense of achievement may be achieved using clear success criteria like checkboxes. Objectives should be viewed as more than process automation or reporting routines.
Customer experience, staff empowerment, product and service offering change, and operational efficiency are part of the project’s projected Digital Transformation. Only then can the project achieve the targeted ROI.
2. The Management Commitment Is Not Enough
Employees must put in a lot of time to learn how to operate an ERP system in addition to their regular workload, which most organisations are aware of. However, most management teams need to devote their attention to it. ERP projects can quickly come to a halt if the project’s executive team is either unresponsive or overworked. Not pressing a single button will solve all your problems, and the system requires ongoing monitoring and revision.
The ERP integration project team needs high management’s strong written and verbal support. Creating open lines of communication and re-establishing intended outcomes should be standard procedures. Apart from that, allocating necessary resources, fostering a happy and productive work environment, expressing gratitude, and making themselves available for questions and support all contribute to setting the tone for progress.
3. Project Teams Aren't Skilled Enough
A deliberate approach should be used while integrating ERP systems. To get things started, you need to assemble a solid project team that comprises a project manager, key users, and IT personnel. Key personnel in procurement, marketing, logistics, sales, manufacturing, control, and service must be well-versed in all aspects of the business to avoid knowledge gaps. There needs to be more leadership among the team members regarding ERP integration.
4. Transparency in Communication
Management, project team, personnel, and software vendor communication could be improved in ERP integration efforts. Obstacles arise when questions and concerns raised by workers go unanswered, leading to gossip and hate.
To avoid this, could you keep lines of communication as open as possible from the beginning? The weeks preceding the start of integration should be spent setting up technologies to provide a constant flow of data and maximum transparency for the project. Set up a weekly meeting, for example, and send project updates via business publications and email. It is always preferable to overcommunicate than to communicate inadequately.
Unless you solve this issue, the ERP problem will quickly morph into a communication problem, contributing to organisational friction.
5. Processes of Production Aren't Specified
For an ERP system to map your company’s processes, you must have a complete and accurate set of existing procedures recorded. The process modelling is quite time-consuming, so could you be sure to give it the attention it deserves?
It’s the best moment to maximise your productivity at work! Before your ERP is deployed, your software supplier should be able to assist you in evaluating current processes and identifying opportunities for improvement if the new software can’t replicate a given procedure precisely the way it used to, be open to change, and be adaptable. Instead of investing in specialised software, you’ll save money by making minor adjustments to your current workflow.
6. Complex Customization
A system must be customised as little as possible for it to be effective and simple to maintain. In addition to reducing project time and costs, this may be a huge benefit. However, this can only be accomplished if the users are well-versed in the standard functionality of the product and have a clear understanding of the adjustments that must be made with the implementation partner team. When a system is heavily customised, the user experience and performance suffer.
Clients may have to adjust their business operations if the standard system is adopted. I think this should be looked into to the fullest extent feasible.
7. Imports of Data Have Been Oversimplified
The company must migrate existing data to the new EPR program. This step must be taken very carefully, as a comprehensive injection is necessary, which is more complex than importing from an excel document.
Additionally, some myths believe that using ERP programs would immediately improve the quality of unstructured data. The new system’s data quality will be limited to the previous system’s.
The mapping procedure begins when the records have been confirmed. Each piece of legacy data is mapped to its corresponding counterpart in the new data structure, and they are also verified for errors. Once the new data has been validated in the simulation, it will be implemented in the production system.
The difficulties and problems associated with an ERP system should not be underestimated since the process considers the tight collaboration of systems, processes, and personnel. However, problems and hassles may be avoided with sufficient planning and a well-organized procedure.