What Every CIO Should Know About ERP ImplementationsAugust 1, 2011
As the president and chairman of an independent ERP consulting firm that guides organizations through ERP and IT software selection, implementation and organizational change initiatives, I often am in meetings with chief information officers (CIOs) nervous about embarking on an ERP implementation. Their concern is understandable; ERP implementations are complicated, expensive and risky. Even more nerve-wracking? A CIO’s personal job security might be negatively affected by how he handles the project.
After years of similar conversations and hundreds of implementations, I have amassed a top-ten list of what every CIO should know about ERP implementations:
- ERP is about your business, not the technology.
- ERP initiatives are very challenging.
- Selecting the right software is the first step in a successful ERP implementation.
- No ERP software is perfect. All have their strengths, weaknesses and tradeoffs.
- A business blueprint is the second step to an effective ERP implementation.
- Business-process reengineering should happen before, not after, you implement your ERP software.
- Your project will fail without adequate organizational change management.
- Executive buy-in and support is critical to ERP success.
- There is no “one size fits all” ERP strategy.
- In addition to planning, implementation also is about execution.
Hammering Home the Critical Points
While I don’t have room to expand each of these tips individually in this piece, it is helpful to hammer home a few of the more absolutely critical points. First, all ERP-software selection and implementation projects must start with a concerted effort to document and understand the business processes currently in use at the organization.
- What works, and what doesn’t?
- What “workarounds” have employees created to make the current ERP system (assuming there is one) fulfills their needs?
- What are the organization’s key priorities?
- Why is the organization implementing a new ERP system? and
- Who is in charge of what?
As tip number six above states, business process reengineering should happen before, not after, you implement your ERP software. This is key—no organization should dive into an implementation before spending a large amount of time understanding how people work within the organization, and how the organization itself actually works. No ERP software is so magical as to address these issues for you; you must take control and drive the reengineering so that the software you do select performs in the best possible manner.