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We like Lotto tickets, but their odds are longer than a million to one. Hoping for a lottery win is much the same as looking for quick-fix ERP software. You could get a great result, but the chances are hugely stacked against you.
At least as far as software is concerned, we have great ways to shorten odds.
We do often hear people say they want the best corporate software, instantly. If history is any guide, this is extremely wishful thinking, sorry to say.
Most companies will find that there’s no such thing as an instant fix-all solution for them – it probably can’t be instant and nor can it fix everything.
In real life, companies’ situations, challenges and needs call for well-reasoned solutions, each of which fits well for its particular company.
Initial ERP selection?
The usual starting point for a new ERP system search is informal, and varied.
Maybe you ask colleagues, have you heard about an effective system in another company (or a system to avoid)?
Is there an IT-minded person on staff who could start to evaluate ERP possibilities … or who could even join together existing software into a “make-do” connected system?!
Could roving on the web bring candidate systems into view?
Small and medium companies’ searches do often start in such ways.
You might even form a shortlist. However, you would still need hard-nosed criteria by which to select the best fit-for-purpose ERP system for your company.
First of all, an ERP is like spectacles or dentures! The ERP system must fit you or it’ll do more harm than good! The software has to work together with staff and must fit the workflow. It must become a part of the team, just like other colleagues at work.
Achieving this fit doesn’t happen overnight: everybody (both humans and software) will have to adjust.
The ERP must also support the way you run the company, your “corporate culture”. For example, you might be a hands-on boss or delegate much to staff. Or maybe some departments work more autonomously while others don’t.
Whatever the “map” of your company, a fully effective ERP system needs to fit appropriately, and be capable of flexibility for future changes.
Functionality compromises?
For assessing what uses the system can provide, all available ERP systems have built-in functions which look attractive to use.
Naturally enough, many software vendors will highlight the range and attractiveness of their best-looking functions.
However, in real day-to-day working life, users then find that they use only a small fraction of them.
Think of it in numbers like this: a full-range ERP system might have as many as 10,000 possible functions, big and small. It’s fair enough that perhaps about 2,000 of these might ultimately be relevant to a particular customer company.
Of these 80 or 90% might serve pretty well, but 10 or 20% will be awkward in functionality and will fall from use, (or they’ll undermine their original purpose by taking too much extra time).
Then also, sooner or later, there’ll be another 100 or so functions which the ERP can’t provide — these become a wishlist for additional software development (or a cause for regret about the ERP selection!).
When the tally of functions is reviewed — the useful, the not-quite-right and the wished-for — people all too often repent of choosing an ERP system which is designed to have maximum appeal with “bells and whistles”, but no genuinely individual attention to each company’s close-fit specifics.
To top all that, as a company continues to develop, its ERP system should grow and change with the company. If the chosen ERP system can’t provide that, significant new investment, re-training and downtime will be required.
Change Management challenges
The real challenge to a quick and instant solution is not in the selection itself. Assuming you have already done well in selection, and have the software ready as envisaged, you will still have to incorporate this into the company’s life.
Changing is hard — it takes extra effort and not everybody is ready for that. The bigger the system, the more people it must interact with, and every each one of these interactions will create ripples or even tsunamis.
No IT project stands alone — it’s always part of something bigger, like reorganising a department or maybe the whole company.
This will take time, from a few months to a few years. So actually, the readiness of the software is just the first phase of the journey — an equivalent or bigger phase is to follow. This is where most IT projects run out of steam.
If the initial selection of the software house did not take this fully into account, if there are no resources left to finish the journey, then it will probably become a half-finished ghost project.
However, with special measures the problem is not insurmountable. The software will probably have to be modified, in some cases simplified even, to meet users halfway. And the staff will have to be trained, mentored, for a surprising amount of time to meet the software halfway.
In other words, the actual incorporation of the new system is a project in itself, and the change in the company will have to be managed. It is in many ways the same kind of Change Management that merging two companies would mean, or like suddenly hiring a substantial number of new people.
Change Management is often neglected by managers who think they can provide minimal user training and expect their staff to use the new ERP software without resistance.
The impact of a new ERP system is often not fully considered, in spite of the change it will mean to users through business processes and job responsibilities.
The ERP industry has been through a difficult and lengthy evolution and the historical picture of corporate software installations is depressing overall. However, new methodologies arise with exactly these problems in focus.
Appropriate experience and education are missing while corporate managers accumulate even more battle scars … and demand is growing for long-term solutions.
For the solution to fit the company, software houses need to use state-of-the-art methods and procedures for mapping the individual company’s current state and growth potential. Then the client company and the software house collaborate to closely analyse that company’s operations.
With an individual client-centric perspective, this analysis will reveal which operations or departments need special bespoke software modules and which ones need regular functional modules to best fit this particular company.
A software house should guide and enable your staff's involvement and feedback
For the functionality to be right, the software house must provide truly flexible solutions in the long term. It can be perfectly adequate to start off with standard or configured functions, but the software house should have affordable ways to alter them when needs arise or when company changes take place.
Unless you want to repeat the whole selection and installation processes all over again, you should try to pick a software house that is willing and able to change the software with you.
It’s also a great plus for the software partner if it has the experience to suggest optional industry best practices to choose from. Some of these, or a hybrid of them, may fit the company’s operations and goals best. It is good to know what considerations and solutions have emerged for similar problems.
To support Change Management, it is crucial that users are engaged with a system prototype as it’s being developed. Users should become involved early on. They then explore and practise their skills and begin to experience changes to their jobs, they give feedback and grow to accept and gradually to like the system on which they will be extensively consulted.
This must be coupled with sturdy project management procedures, definitely on the software house’s side, and preferably on the customer company’s side as well. This is to ensure the project maintains a sustainable pace, neither spiralling out of control nor grinding to a halt.
Too much money has been lost in failed ERP installations in the past. This forced some companies to rethink priorities and strategies.
If, statistically, corporate software installation success is a bit of a lottery, then what would be the diametric opposite?
Maybe it was time to shift emphasis to predictable good results instead of spectacular promises.
This requires a new mindset and new methodologies.
Multiple steps of change and user engagement are key features of ERP system success
While there are a few different approaches to this problem, we at my firm have most experience with smartERP methodology.
smartERP is flexible to take into account the client company’s situation and goals. It embraces Change Management to “anchor” changes into workflow and job evaluation, and achieve gains through gradual, multiple steps of change. Also it supports user engagement through prototyping.
A slower, care-taking, methodical approach will not convert everybody from dreaming about quick-and-instant-fixes, but it gives hope to many!
Mike Harsanyi