Despite having been around for thirty years, Enterprise Resource Planning (ERP) implementations still create challenges for many organisations. As recently as 2019, one article suggested that 60% of ERP projects fail, while 90%don’t deliver measurable return on investment (ROI). This blog considers how underestimating ERP business complexity and impact increases risk, and how an incremental. ‘crawl, walk, run’ approach can de-risk and maximize value from an ERP deployment.
It’s not just ERP
The history of IT is littered with lengthy, costly, high-profile projects that never quite lived up to expectations. And it’s not only IT projects – from new airports to high-speed rail lines, plenty of major business change undertakings haven’t exactly delivered what was promised. There are many valid, well-documented reasons for this; lack of a clear vision, poor stakeholder engagement, insufficient change control, or simply failing to understand that IT projects are as much about people and process as they are about IT. I will explore some of these in later blogs. Here, I focus on the basic premise that the more complex the change, and the longer it takes to make it, the more likely it is to fail.
Getting your workforce to move their core business processes to a new software solution, delivered by a provider you have never dealt with before, while building a relationship with a new implementation partner, means that deploying a new ERP platform is inherently complex, time-consuming and therefore risky. One way to reduce that risk is to reduce complexity and speed delivery by breaking it down, taking an incremental approach and maintaining realistic expectations. In other words, crawl before you walk and run.
What Agile can teach us about successful ERP deployment
The 1960s to the 1980s saw growing business frustration with software projects that promised big business benefits yet seemed to deliver only delays, overspend and solutions which never quite met expectations. This spawned a series of developments that moved software development away from ‘big bang’ implementations towards a more incremental approach. These culminated in Agile, a methodology focused on maintaining close stakeholder involvement throughout, continuous learning and feedback, evolving requirements through the project and delivering incremental benefits in a series of focused ‘sprints’. It may seem counterintuitive to associate a sprint-based methodology with a ‘crawl, walk, run’ approach to ERP, but the underlying principles are the same.
A ‘crawl, walk and run’ approach means
• Identifying a narrow area of business change where an ERP deployment can deliver significant business benefit
• Clearly defining success criteria
• Getting senior sponsorship
• Engaging key stakeholders
• Getting the right delivery partner in place
• Identifying the right software solution
• Delivering the incremental benefit
• Implementing learnings across all these elements in the next incremental deployment.
• Widening scope on each incremental deployment with growing learning and confidence (Walk then run)
All these, except perhaps the last, are explicitly defined as part of an Agile approach. Even with the last element, Agile practitioners may recognize how the growing confidence and capability gained with each sprint enables the team to deliver more in each increment.
How a crawl, walk then run approach de-risks ERP deployment
The amount of risk and potential disruption involved in deploying a piece of IT is directly proportionate to its scope and functional importance. Thus, downloading a new gaming app is less stressful than downloading a new banking app, which is less stressful than moving your entire PC setup from Windows to iOS, and so on. So, limiting your initial ERP deployment to a narrow functional scope reduces risk straight away. Just as importantly, it gives opportunities to learn, to build confidence, to try things out and to embed the teamwork and best practice needed for later, larger scope deployments. This applies to the technology itself, and to the people, process and data components which are at least as critical in implementing a new software platform.
A limited scope ERP implementation, one that makes end users’ lives easier without them having to alter their working practices, tends to make them more receptive to more disruptive change later. A limited scope deployment makes the tasks involved more manageable, from learning the new system to data cleansing and loading to acceptance testing, and avoids the kind of change overload that can create resistance. Building relationships with implementation partners and software vendors through an initial low-risk deployment establishes a solid foundation for later implementations where the stakes are higher.
Experience suggests that many major IT projects run late, overspend or fail because, fundamentally, they underestimate the people, process, data and technology impacts of the change. Starting by crawling – understanding and managing these impacts in a limited scope, learning the basics and building on them – creates the foundation to be able to walk, then run, to maximize value and minimize risk from an ERP solution.
How 3V Solutions can help ?
3V Solutions is a trusted SAP Partner backed by solid leadership with experience in implementing and managing 20+ SAP Solutions from mid-sized to Fortune 1000 companies across the globe since 1997. Leveraging SAP best practices and industry experience, we understand our client’s unique business needs, enabling us to deliver the right solutions to embark on their digital enterprise journey. If you are considering an ERP journey, we can engage with you to understand your needs and bring our extensive expertise and experience to make that journey successful.
What next ?
To continue the conversation, visit us online https:/3vsolutions.com/ or contact us at +1-844-380-4262. We will be happy to discuss your ERP journey with no heavy sales pitch involved.
