Why ERP Implementations Fail

There are certain things in life that most people will turn to the expert for help. If your car breaks down you call a mechanic, if you feel unwell you see a doctor and if you want to build an extension you contact a builder. But there are people who will give anything a go, digging foundations, laying bricks, tiling and decorating. This approach is likely to save money on labour costs, but could take longer and compromise the end result.

The same approach is often taken in business. It's not uncommon for businesses to undertake new projects in house, such as recruitment or new software implementation. After all, the members of the organisation know the business better than any external consultant.

If considering this approach, there are some common pitfalls to be aware of.

1. Not experts in ERP software

You wouldn't employ a plumber to fix your car, so why get your own resources to manage your ERP implementation.

The variety of skills required to undertake a successful implementation span technical knowledge of the software as well as change management, data analysis, strategic and project management skills.

An experienced ERP implementation consultant will be aware of the potential challenges and issues before they arise and the best person placed for a smooth implementation.

2. The project is not your day job

The chances are that you don't have an internal ERP specialist. So you may be considering who will be best to manage your ERP implementation. The problem with this is that it won't be their day job and something always has to take priority. This is often the reason why projects take longer than expected. For some it will be the main priority, for others it will take a back seat and there will usually be more pressing and urgent things that need to get done.

3. Skipping the needs analysis stage

The first and most important aspect of any ERP implementation is carrying out a needs analysis. Without this how do you know if the solution identified will match the business needs? The variables with complex ERP solutions are vast, and so identifying what you actually need it to do is a vital step to take. Otherwise you could end up with a sports car, when you really need a family waggon.

4. Change management is not simple

The skills required to manage change do not come naturally to many people. You need to have excellent people skills, the ability to network, coach and build trust amongst stakeholders. As well as being resilient, with good communications skills and the ability to see a project through to completion. Do you have the ideal candidate in-house?

5. Scope creep

External consultants will set out the initial scope of the project and stay focused to deliver it. This is not always the case when implementations are carried out in house. As soon as stakeholders get involved and hear about the potential for the new system, they can get carried away, adding on bells and whistles, which in reality are not needed.

6. Not carrying out effective training

A lack of proper training is one of the most common reasons that ERP projects fail. Employees won't fully understand the system, won't use it to its full potential and will just end up complaining about it.

With any new process or system in place, you want the integration with the business to be as smooth as possible. But you also want to get the maximum benefit. This is where training is so important. Otherwise it's like taking delivery of a new piece of flat pack furniture without assembly instructions!