Avoid Expensive ERP Mistakes – this blog will show you how!
84% of business leaders surveyed by SAP and Oxford Economics say digital transformation is critical to their survival in the next five years, but all too often businesses report expensive failures. How can those Expensive ERP Mistakes be avoided? This article offers you valuable pointers on how to choose tech partners you can trust while gaining important insight into your own processes.
Imagine a scenario where you can’t raise an invoice, you can’t even place a customer’s orders and you certainly can’t see what your stock levels are.
You might even say “Time to invest in some great value business software” but WHAT IF – this nightmare wasn’t a precursor to investing in new software- what if it was actually AFTER you bought and installed ERP for your business?
Yes – These kind of worst case scenarios do exist and you don’t want it to happen to you. That is why we have spent some time thinking about how we can help people avoid the worst.
And it comes down to this.
The Four Ps. Preparation, Partnership – People and Processes – How to Avoid Expensive ERP Mistakes.
You’ve heard the saying, fail to prepare – prepare to fail? It’s a cliché, but it is spot on. Successful ERP is all about the preparation. Whether it is preparing your data, your people or even preparing by choosing your system well – it is all in the groundwork. And one of the best things you can do is choose a good partner.
Very often the problems that occur, happen because of relationships with other people. Clients often tell us about vendors who are all over them up to the point of sale, then implement as fast as they can and disappear, leaving them with systems they don’t know how to use – no wonder confidence levels are so low.
We prefer to talk not about vendors but about partners – because that is what it is – a partnership – so your choice is very important.
Right from the start you need to make sure you are working with a partner who understands your business and has your best interests at heart.
Think of it as choosing a long term PARTNER for life. If you were looking for someone to spend the rest of your life with you might go on a lot of dates, maybe even with slightly unsuitable people but when you finally decided to settle down you would want to make sure you made the right choice!
We think it’s really important to get this right because when you’re making any kind of investment, worries about things going wrong are often what holds you back. So if you want to get things right take your time choosing. Give yourself plenty of time to analyze more than one competitor and test drive both the software and the support team.
Most companies that implement ERP are not migrating from one robust and sophisticated ERP system to another; in reality they’re going from something fairly primitive to something much more powerful. Think spreadsheets or basic SAGE accounting packages.
So – It is going to take time and commitment to master your new ERP And its going to need a lot of buy in from your people. It won’t happen overnight.
Think about all that new functionality and power under the hood…it’s like driving a Ferrari! And so that’s something you and your team need to come to terms with. The old People Mover has gone – you’ve traded up! You need to get buy in up and down the chain of command and choose enthusiastic project leaders who are going to be able to drive it through.
Most companies drastically under-estimate just how big the change is going to be and they don’t plan for resistance from within their own workforce. There’s an example from the BBC back in the day when journalists were so resistant to getting PCs they ignored them and put their hats and coats on them instead. So set realistic deadlines – don’t make Expensive ERP Mistakes and don’t expect to get buy in overnight – it might take some time to get it right. And one more thing – do dedicate sufficient resources.
This might mean investment in training.
Not finding enough time and money for proper training is one of the most common reasons ERP implementations fail. Lack of training can lead to employees going all Luddite on you and resenting the new system – it’s not that they don’t want to see the company doing well – it’s just that they don’t understand the system and they don’t know how to use it.
Try sharing your vision for the company with your staff from the outset and then make sure they get the chance to get comfortable with the new kit before it goes live – that will go a long way towards improving your chances of overall success.
Also be prepared for the fact that some issues might not come to light until after the implementation team has left – it might not be until you get to a certain point in your business year that you realise you don’t know how to do something.
If you get into trouble you might want to have some idea of what you’re going to do – good vendors will have ongoing training packages, help desks and learning webinars. We recently held a successful learning day for clients in which we were able to unpick those aspects of the system that they hadn’t got to grips with yet. Our clients really appreciate this aspect of what we do because they know that it’s a journey and not just an implementation.
Lots of the hard work and learning comes afterwards. If you see coming back for help as part of the process then you are not likely to see it as a failure, either on your part or on the part of your vendor/partner. It really pays to have an ongoing relationship with your vendor. You never know when you might need them!
Processes and Plans
Where possible we want to know what your business plans are. Yes we can add in things afterwards – but wouldn’t it be great if we had an idea of your road map for the future so that we can configure your system for both your current and your future requirements?
For example – Are you planning to trade in several different currencies, are you planning to set up a warehouse overseas? Sharing your plans is all part of the process of getting to know you and your business and a lot of people find it very useful to have to sit down and think about these things at this sort of level.
The other thing you need to share with us are your Business Processes – how you do things now and how you might be going to do them in the future, because that is unlikely to stay the same. It’s a time of change but also an opportunity to get your house in order and look at best practice. Because of our experience and the experience of SAP who stand behind us, we can tap into what’s been learned from thousands of other companies like you, in terms of the best way to get things done and that is a useful advantage to have.
So, as part of your preparations be prepared to define your business processes in detail, which in turn gives the technical consultants something to work with.
And finally – Test It!
Unless you test the new software, you won’t know how well it’s going to hold up to heavy use in the real world. It’s not just about the demonstration model you might have seen during initial meetings – the real life version has to work for you, so take the time to test it out.
I hope I haven’t scared you too much – it is only what any and every successful company is going to have to do to get the digital leg up they need to run their business more efficiently.
It can be tempting to choose the first ERP software partner that comes along, but it’s important to look past the initial sales pitch and decide on someone who doesn’t operate a one size fits all policy… that way you can avoid Expensive ERP Mistakes. We aren’t always able to cover absolutely everything on our website, so please be inquisitive and get in touch and ask as many questions as possible.
And if you think you’re falling into one of the traps I’ve outlined today, take a step back and consider your options. Remember that a lot of it comes down to people and how they react to change and if you can get on top of that you are going to be in a fabulous position to avoid Expensive ERP Mistakes and to get the most from your ERP system – hopefully for many years to come.
This blog – How to Avoid Expensive ERP Mistakes – was originally delivered as a talk to Smarter Business Tech Live in November 2017 by Caroline Atkinson founding partner of In Cloud Solutions which specialises in SAP Business By Design – ERP for medium sized business.