It’s the soft things that hurt the most
The implementation of an ERP system can be divided into two parts: the technical implementation and the organizational implementation. The technical implementation consists of getting the IT solution to work — in other words, determining in detail how the system should operate and then building the solution. The organizational implementation, which experience shows is by far the most difficult part, involves getting people to understand and use the new system. It sounds simple, but the fact is that this is where most ERP projects fail.
The easiest part is getting the new hardware to function. It is somewhat harder to get the software to function. But the most difficult task of all is getting employees to understand and use the new system.
Many companies equate the organizational part with user training. This is partially true, but there are many additional aspects that must be addressed for the project to succeed. Many call this change management. We refer to it as the organizational implementation that accompanies most business-driven ERP projects. It covers all the activities needed to prepare the organization to receive the ERP system. This includes ensuring the organization is continuously informed about the ERP project, that all users receive sufficient training in the new system, and that the organization is adjusted to work with the new processes and structures.
The implementation of an ERP system can be divided into two parts: the technical implementation and the organizational implementation.
New ERP technology makes it possible to streamline several work processes. With the new technology, the company can also break down various organizational barriers. Work processes can be moved between functions and organizational units, and more information can be made accessible to a wider group of people. At the same time, one often finds that an organization changes its behavior and norms because of the new technology, meaning that an ERP project also has a cultural impact.
Organizational activities are often the ones that are cut. Many companies assume they can do without them, but once the project is completed, they will realize that this was not the place to save. They will typically experience that many of the business benefits are not realized because the “soft” side of the project was not planned and managed from the outset.
The change-related activities will differ from project to project. They depend largely on how big the resulting changes are. Small changes require little focus, while major changes require strong focus on the organizational activities. It is important that the company prepares and plans these activities. Otherwise, close to implementation, it will be met with resistance from future users, and several potential conflicts may arise within the organization. Furthermore, the company will not be able to realize the business benefits of the new technology. Fundamentally, the task is also to keep employees informed about the planned changes and to manage the expectations of the various stakeholders.
