ERP Implementations : Why many try but few succeed
ERP implementations are more commonplace than ever, and in 2021, the global ERP software market is expected to reach $95.37 billion. But for the individual businesses conducting their implementations, it’s still a once-in-a-decade event that represents a massive investment. This rarity leaves many businesses with an in-house skills gap needing to be filled by outside expertise, which is a key reason why the majority of businesses seek external help during an ERP implementation.
Many businesses choose to work with an integrator to help keep their ERP projects on track. However, according to analyst firm Gartner, 55 - 75% of all ERP projects fail to meet their objectives, indicating that this alone isn’t always a guarantee of success. Businesses and integrators don't always speak the same language, and there can sometimes be a lack of understanding of the process as a whole.
ERP implementation success often hinges on having a strong project management function with a clear overview of the process, which can set expectations, time scales, milestones, and ease communication between all parties.
In this piece, we’ll look at the common issues that companies face when conducting an ERP implementation. We’ll also look at how an independent strategic partner can close the gap between business and integrator, drive a one-team approach for the project’s entire lifecycle, and ensure the project achieves its business goals.
"If it’s an IT thing, it will not succeed. You must have senior management and multifunctional commitment to the project."
Setting up for success
Klosterfrau ERP testimonial video
Helmut Fabry, CEO and Christian Wurzinger, CFO at Klosterfrau discuss their experience of working with Genioo on their ERP implementation project.
The foundation of any successful project is ensuring all stakeholders are on the same page, with the same goals, from the start. In this ‘pre-project’ phase, it’s essential to develop a robust plan with clear guidelines, roles and responsibilities. But often, this first key phase is where gaps can begin to appear.
ERP implementations are often seen as IT projects, which makes it harder to get the crucial buy-in from the business. In reality, they are business projects which will impact a wide range of stakeholders. Getting all of these stakeholders on board is crucial to ensuring everyone understands their role and is committed to achieving a successful implementation. Similarly, creating a detailed execution plan needs to involve all stakeholders, which can be a complex exercise.
With integrators being naturally more focused on delivery, bringing all these parties together at the beginning isn’t always high on the agenda, so having an experienced strategic partner can be critical to creating this early cohesion within the team.