A badly implemented ERP or other business information system can drive inefficiencies, result in loss of customers and in extreme cases can bankrupt the business – see examples below where I discuss a few examples of ERP issues that I have resolved.
For £2,000 in two days I will give you an informed opinion with regard to why your system is not meeting your expectations with a formal letter report setting out critical findings and critical recommendations in business language that you will be able to act on.
Please reply to this email to arrange a complimentary Zoom call.
1. Fragrance importer and distributor with SysPro ERP and companion WMS dramatically turned around
I met, Robert Priebatsch, the CEO and part owner of a firm of fragrance importers and distributors, at a lecture I gave on the strategic application of ERP and why ERP investments failed at a part time MBA course at a high profile business school.
Robert had an ERP implementation with companion Warehouse Management System (WMS) that had failed and needed it turned around urgently. He asked me to make his ERP a “strategic weapon” in line with my lecture. The ERP was Syspro a popular tier 2 ERP.
I undertook a short investigation and established that the failure resulted from governance issues on the part of both implementers and the client. I was asked to lead the turnaround which I accepted subject to:
- Working closely with the CEO and the CEO attending all key meetings and being available whenever I needed him – I copied him with every email.
- The CEO of the ERP implementers attending weekly project meetings in person and being involved as necessary to steer his side of the project.
- A director of the WMS implementers to do the same.
This was all agreed and I took on the high level management of the new project and turned the situation around to successful implementation in five months.
In the process, I applied my “precision configuration” techniques to develop a highly structured “Product Class” hierarchy and other precision validation tables. The product class, which ended up being a “Brand Hierarchy” of about 550 items, provided the logic for me to specify and have developed some bespoke software to manage the capture of new products with very precise control. This, in turn, opened the door for further bespoke software to automatically generate a marketing project in the Projects Module of the ERP with 29 highly structured marketing expense heads for each Brand Line. This was used by the Brand Managers to plan and manage their marketing campaigns on a monthly year by year basis.
The end result of this was that a year after the highly successful go-live the client was able to secure Dior as a represented brand with an immediate 12% upturn in revenue because my client could do things no other distributor could do in terms of managing the marketing of the brand.
Email me for the slide deck for a joint presentation to the IT Web BPM Summit.
I also assisted the client to develop a highly structured Cubic Business Model Chart of Accounts.
Testimonial by Sean Stuttaford, CEO of the above ERP Implementation Company
Following the above highly successful ERP turnaround I built a strong relationship with the Implementers based on the value I had added and they took on board many of my methods and engaged me to work with them for a number of major clients, including a major food manufacturer and distributor and a major engine block manufacturer. Sean, the CEO, had this to say in a formal testimonial:
“This … serves to confirm that I have known Dr James Robertson … We met at a mutual client where my company was implementing a new ERP system. James joined the project at the invitation of the client to assist with his strategic approach to the implementation as well as perform a project management role. I consider this period, my biggest learning experience in terms of how to successfully implement an ERP system.
“My first reaction to the Dr Robertson’s approach was confusion and resistance, however after a short period of working on this initial project together and finally understanding his approach, particularly how it could substantially improve my company’s success rate, I bought in and imbedded his principles into my organisation. Since then I have applied his philosophies in the organisations I lead.
“Following the initial project we undertook with Dr Robertson our company applied his principles on new projects resulting in a far greater percentage of successful projects and customers who got what they expected.
“At all times I have found James to be reliable, hard-working and dedicated to ensuring that he achieves the results he promises. His engineering background supports the attention to detail he achieves in his projects and the logical approach to his work.
“I would recommend James to an organisation in need of a person who is extremely skilled at rescuing a failed project or assisting a company in need of improvement in order to make decisions which will ensure its future success or extract new value from the organisation.”
For £2,000 in two days I will give you an informed opinion with regard to why your system is not meeting your expectations with a formal letter report setting out critical findings and critical recommendations in business language that you will be able to act on.
Please reply to this email to arrange a complimentary Zoom call.
2. International Mining Company Running SAP R/3
Another example – stark contrast – SAP R/3 ERP (Big SAP), world leading product, reputable implementers. Running live across two mines on opposite sides of the planet. Running on spreadsheets because the ERP was such a mess.
Chief Executive said to me “Dr Robertson, I have one tunnel and they cannot tell me how much it is costing to develop that tunnel, in a year I am scheduled to have thirty tunnels, what am I to do?”.
I found a massive chart of accounts about which the big brand software company said “xxx is so powerful it can handle this” when in fact it was just about the most badly designed chart of accounts I had ever seen with assets and expenses jumbled together and which was at the heart of the problem. The company had retained a Chartered Accountant who had been unable to get the Balance Sheet to balance after six months of hard work.
I recommended reimplementation with a highly engineered chart of accounts and other improvements. There was huge potential. The operations executive got between me and the CEO and decided that this was too radical to tell the shareholders and that they should rather go for a limited scope remediation without my assistance. A few months later the company was bankrupt which was sad because I could have turned it around in months.
Vital to understand that a bad ERP implementation can literally trash an otherwise strong business!
3. Fertilizer Manufacturer with major issues with BPCS ERP
High levels of Executive frustration with incumbent BPCS ERP and associated custom development. Strong sentiment to scrap the software even though it had only been recently implemented with a considerable investment. Implementation included Warehouse Management and Manufacturing as well as ERP, financials, etcetera.
In one week I established that the software was not a good strategic fit to the business such that the custom development outside the software was necessary but was seriously complicated as a consequence of an unwise “zero customization in the software” policy that had seriously complicated fitting the software to the business.
I also found that the bad attitude at the management level was in part due to an extremely toxic attitude on the part of the IT Manager and partly due to extremely bad communication between the technical team and management.
In a further two weeks I undertook a comprehensive audit of what was required to remediate the system and submitted a detailed report on what needed to be done.
I then facilitated a decision in which the CEO took personal charge of the system and issued a formal policy decision that the system would not be replaced and that all staff were required to “make it work”.
I assisted management in a decision to replace the IT Manager.
I facilitated a discussion with the software providers where the client secured a five year support contract on the existing software with customization’s with the right to renew. The system lasted for another eight years before being replaced with SAP R/3.
4. Transport customer with specialist industry requirements
The client was battling with a bespoke solution that had been in process for eighteen months and was going nowhere. The software company kept blaming the business.
In two days I identified that the software company did not understand the business and were insistent on a solution that was totally inappropriate. I advised the client to terminate the project and go out to tender for a new system. The CEO of the client stated at this point “… after 18 months we still did not have a solution … they kept blaming us … after engaging Dr James within 48 hours we had got our head around what the issues were … totally inappropriate solution … we knew what the way forward … for the first time in 18 months there was clarity of vision regarding what had to be done”
I drafted a detailed set of tender documents including a seventy page Request for Proposal using my standard document pack and we went out to tender, which I facilitated, appointing a software company with a transport industry specific product that was an excellent fit.
For £2,000 in two days I will give you an informed opinion with regard to why your system is not meeting your expectations with a formal letter report setting out critical findings and critical recommendations in business language that you will be able to act on.
Please reply to this email to arrange a complimentary Zoom call.
5. Just-In-Time Chemicals Distributor with JD Edwards
Another example: After go-live and because of issues with the new JD Edwards ERP implementation my client lost its biggest customer with two more major rumoured to be on the point of leaving.
The client was an importer and distributor of industrial chemicals suppling large “just -in-time” manufacturing clients.. They implemented a JD Edwards, a leading brand, implemented by one of the ‘Big Four’ global consultancies. Yet, their service promise had been trashed – “order in by 3 pm, delivery by 10 am next business day” had turned into delivery in two to three business days. They fired the implementers and hired another big name implementer but the problems continued.
I accurately diagnosed the root cause of the problem in two days – the ERP and WMS (warehouse management system) were not correctly integrated and data was being transferred between the systems manually, load planning was also being done manually. The business was traumatized and losing money.
The implementers could not tell me why the system was performing the way it was and, more importantly, they could not tell me how to fix it. The previous ERP was still in use in the other division of the business having served the business faithfully for many years. The only reliable solution was to revert to the old system.
The customer did this in six weeks and the service promise was once more fulfilled and the business turned around! One of the executives of the client subsequently told me “that (abandoning the new system) was the best business decision we have ever taken”. This is not about a regressive leaning to old technology it is about finding an emergency business solution that was 100% reliable at very short notice before more customers left!
The REAL Challenge
The challenge with ERP and other business systems is not the technology, or the fit of the technology to the industry, it is about the decisions taken during the implementation that get in the way of the business. This includes issues such as executive custody, strategic alignment, precision of configuration and similar matters. In fact, the factors that give rise to ERP and other business system non-performance are more to do with psychology than they are to do with technology or industry. See the articles “The critical factors causing ERP and other strategic project investment failure” and “The critical factors for ERP and other strategic project success” which graphically evidence that the success of ERP and other business information system investments is not a function of technology or industry but of issues like governance, strategic alignment, configuration precision and the like – effectively they are issues of psychology.
6. Financial Services company with Bespoke ERP
Another example – the client was a niche player with an industry specific business information system in which they had invested considerable sums. The system kept falling over and losing data and the business was at serious risk. The consensus was that the software was decrepit and the only solution was to fire the developers, trash the system and start again.
In two days I diagnosed the root cause of the problem – the Human Resources Director, who had been made responsible for the system about six months previously, was completely lacking in technical insight and was aggressive in his ignorance – all he knew was not to spend money.
Despite the fact that the business had doubled in size he refused to invest in new hardware with the result that storage and memory limits were constantly being hit resulting in the software crashing and data being corrupted. The software company were struggling to keep the system running.
The HR Director was blaming the software company to the point where the software company was on the point of quitting and the situation had degenerated to a point where a civil conversation was all but impossible. I concluded that the business was facing the potential of catastrophic collapse of their systems!
I advised the Managing Director and owner of the business of the findings and advised that:
- He personally take over governance of the system.
- Immediately initiate emergency procurement of new servers.
- Initiate emergency negotiations with the software company to heal the relationship.
The issue was partially resolved within a week and fully resolved within a month.
I can help you!
If any of these scenarios looks in any way familiar, I can help you!
For £2,000 in two days I will give you an informed opinion with regard to why your system is not meeting your expectations with a formal letter report setting out critical findings and critical recommendations in business language that you will be able to act on.
Please reply to this email to arrange a complimentary Zoom call
Notice that none of the failures relate to defective software or industry related issues, they all result from other factors, that I have referred to as “ERP Psychology” – the manner in which human beings implement, manage and operate the software.
It is important to recognize that there is a substantial body of opinion, Gartner included, that indicates that somewhere between 75% and 95% of ERP and other business information system investments “fail to deliver what was promised”. I have validated this statistic independently. The challenge is that very few people know how to really resolve this! The fact that this statistic has hardly changed in twenty years validates this statement!
I say with confidence that I CAN turn your situation around!
Then there is the problem of denial! Many people do not want to truly admit that their ERP or other system is costing much more to run than expected, is not giving them the business benefits that they based their buying decision on and is, just simply, a huge disappointment.
This is not helped by ERP marketing that suggests that only brand X can solve your problems after you have invested a huge amount in brand Y. As with the Mining House example, there is also the unwillingness to admit to the shareholders that the company has messed up, notwithstanding that this can cost the shareholders their entire investment.
Divorce seem inevitable?
Are you approaching the point where divorce seems inevitable but you are not sure it will be any better next time round?
Contact Me
If these stories speak to your ERP nightmares, let’s talk. Our initial meeting for an hour on Zoom comes with no strings attached. Please click the button below to arrange a complimentary, no obligation, call to discuss your situation.
Dr James A Robertson
The ERP Doctor
For £2,000 in two days I will give you an informed opinion with regard to why your system is not meeting your expectations with a formal letter report setting out critical findings and critical recommendations in business language that you will be able to act on.
Please reply to this email to arrange a complimentary Zoom call