Today I would like to discuss the fifth factor giving rise to ERP implementation failure – Failure to address soft issues, business engagement and change impacts with a weight of 12%
Soft Issues – a Practical Example
The client was a moderate size freight forwarding and clearing company part of an international franchise.
They were in the process of implementing what was supposedly the most successful and most effective industry vertical ERP in the world.
The software company were also the implementation consultants.
Under pressure to deliver results, the software company pressured the client to start making head count reductions before the system went live.
Management agreed and made 40 people redundant, many of them long term loyal staff members. There was chaos amongst the remaining staff.
A year later the system, faced with continuous sabotage by the remaining staff, was still not live. The diagnosis was simple “if they can let that many people go before go live, imagine what will happen to the rest of us when it goes live!”
The firm ended up abandoning the system and buying something else.
This case study demonstrates what happens when the people issues are not effectively managed. I advocate what I term “the Business Systems Laboratory” to thoroughly test the system and introduce it to staff in a constructive manner. I will discuss this in the next article.
If you find what I share of interest and desire more information please email me.
Next week I plan to discuss how an effective Business Systems Laboratory can deliver huge benefits and increased profitability and is critical for success – the fifth factor required for success.
For more information about the services I am offering please visit www.The-ERP-Doctor.com
Context for Reference
For ease of reference the full list of factors is as follows:
Factors causing failure
The seven factors causing failure are:
1. Mythology, hype and tradition – 30%
2. Inappropriate or ineffective executive custody, governance and corporate policy – 19%
3. Lack of effective strategic alignment and strategic solution architecture – 16%
4. Lack of Precision Configuration – Sloppy Configuration – 14%
5. Failure to address soft issues, business engagement and change impacts – 12%
6. Lack of an Engineering Approach – 6%
7. Technology Issues – sub-optimal or defective software, hardware, network, etc – 3%
The percentages represent the extent to which each of these factors has played a part in the investigations I have undertaken. It is important to note that the factors with the lower weights are still very important but that if the higher weighted factors fail it does not help to get the lower weighted factors right.
Critical factors for success
The seven critical factors for success are:
1. Effective Executive Custody – 25%
2. Effective Strategic definition and alignment – the Essence of the business – 22%
3. Effective Engineering solution design and implementation approach – 17%
4. Effective Precision Configuration – 16%
5. Effective Business Simulation Laboratory operation (war games) – 12%
6. Effective Business Integration, training, change facilitation, process specification – 6%
7. Reliable technology – 2%
Conclusion
From consideration of the above it will be apparent that the real issue is not the ERP product, all the mainstream products are capable of delivering a quality outcome, it is the quality of the implementation and therefore the capabilities of the implementer that are critical.
In the weeks ahead I plan to continue to share the headlines of my thoughts on each of the above and the lessons that I have learned in terms of how to implement ERP and other business system projects in a manner that ensures a successful outcome.
My offering
I offer technology agnostic services in terms of:
a. Instruction and training in how to apply these methods.
b. Troubleshooting projects that are in difficulty and providing guidance to turn them around.
c. Strategic project leadership services achieving a high level of executive engagement and delivering high quality business relevant outcomes.
d. “Precision configuration” – a very rigorous approach to the detailed content of master data and other validation lists and other elements of the configuration. The lack of this was a major factor in the above failure, I will discuss this in more detail in due course.
e. Comprehensive, robust, tender based, ERP and other major systems procurement.
If you would like further information please reply to this email and we can get on Zoom to discuss.
You can also visit https://www.the-erp-doctor.net/ for a catalogue of method and technique that evidences the full spectrum of my knowledge and experience in this field.
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