Implementing effective enterprise resource planning (ERP) systems, such as SAP is fundamental to any company’s efficient operation and underpins its growth strategy, says COO of Britehouse, Paolo Masselli. If not delivered effectively, these implementations can be very expensive, take a long time, and can ultimately cost your business enormous amounts of money in lost revenues that dwarf those implementation costs.
We often tell customers of the pitfalls of these implementations, and just as often they disregard these warnings and press ahead, making the mistakes that lead to higher costs and inefficiencies than they were attempting to avoid.
To help your business avoid making these mistakes, we’ve listed our top 10 mistakes, complete with solutions so that when you implement SAP, you are able to go from strength to strength.
Companies deciding to implement an ERP solution based on an ROI calculation will be disappointed, because it is nearly impossible to measure, and leads to frustration when intended targets aren’t achieved. The decision to implement a technology platform must be made based on strategic criteria.
You need to choose a technology platform:
- Whose long-term strategy matches the company’s business strategy;
- That is proven;
- That has rich and extensive functionality; and
- That is developed by a company that is sustainable and successful.
ERP’s are often viewed as a technology solution, and is consequently ignored throughout the company until Go Live. The users then have complaints that what is being delivered is not what they expected. An investment in an ERP is significant and highly transformative for the business, both from a business process perspective and in terms of accessing information.
The company needs all stakeholders to be accepting of the new solution, and must intimately be involved in making the implementation a success. Importantly, this buy-in must start at the top. The Board, the CEO, and the executive management team must drive this as a business initiative, and the transformation process must be embraced by everyone in the company.
The right partner
Too often, companies make decisions on implementation partners based on the lowest price. While price plays a role, the cost of the implementation is generally dwarfed by the potential revenue losses that a bad implementation can result in.
This is why you need to choose an implementation partner based on a long-term, mutually beneficial business relationship. Your partner must walk the road with you, and needs to be innovative, capable of tracking the strategy closely, and be prepared to invest with you along the way.
Hurry up and wait
All too often, companies take a long time to evaluate the technology and their partner, only to then rush headlong into the implementation to make up for ‘time lost’.
This is a classic ‘hurry up and wait’ error, where comprehensive planning has been disregarded once the decision has been made. Frequently, we find that little to no time has been taken to plan the implementation in every detail, mobilise the best business resources to be involved in the implementation, and ensure that the business understands what is coming.
I believe companies should:
- Undertake a roadshow led by the executive team to communicate reasons for the implementation, involvement of people as project resources, and eventually as users;
- Workshop key business metrics with the executive team so that the project team can build the solution with those metrics in mind; and
- Plan, plan, plan.
Too much too soon
Lengthy, ‘Big Bang’ projects that look to deploy enormous functionality can be destructive to your business. Whilst SAP has a huge amount of functionality that can be deployed, implementing too much of this functionality at once can cause long lasting problems.
You need to get use from your software as soon as possible. The best way forward is to put the basics in first, stabilise the solution, then grow the functionality in a structured way over time.
Replicating a bad thing
A common mistake that is made by companies is to replicate what they have in their current legacy systems in SAP. Why is this so bad? Simply, the integrated nature of SAP and the way SAP is designed along business process lines is very different to the way in which legacy systems work. Replication of business processes and reporting requirements is costly and a waste, so in the long-term you need to change this approach and dispose of these custom solutions.
When designing your solution, use whatever best practice processes SAP provides in its standard product, and be open-minded about how you access information and minimise your enhancements.
If the emergence of Big Data has taught us anything, it is the value of accuracy. SAP is data hungry and cannot be operated without accurate data. Bad data causes transaction problems, and ultimately can bring your company’s SAP environment to a standstill. As a result, data cleansing and data migration is a critical aspect of any implementation. Often companies don’t put enough energy and focus into this area, which is one of the main reasons for Go Live delays.
The solution? Start this process at the beginning of the project, make sure that the necessary data mapping is done early, and ensure that the data from legacy systems is holistic and hygienic.
Lack of process education
Depending on how big a jump you make from your legacy systems to SAP, you need to assess the degree of education required in the business. While this may surprise you, it is common for many users to not understand the business terms, processes, as well as the upstream and downstream effects of transaction steps used in SAP.
It therefore should be a priority for you to undertake process education before business users become involved in blueprinting a solution. Not only are these users able to play a positive role from the start, but are also empowered to authoritatively fulfil their project roles.
The fact is that the number of knowledgeable project team members and ‘super users’ are dwarfed by the number of SAP users that must be trained prior to Go Live. The sheer volume of users in need of system training is problematic. This is only compounded by the fact that when training happens, it is both rushed and transaction based. This results in poorly trained users who have low confidence in their abilities.
You need to have a well thought out, comprehensive training strategy that is effectively delivered well before Go Live, and only after several iterations have been done.
If you have implemented SAP, it is imperative that you have a long-term strategy for its support. Too many companies forget about their SAP investment after Go Live. At best, they undertake basic user support. This causes the system to degenerate and the company doesn’t receive the expected benefits.
To combat this, your company needs to continue with application lifecycle management and ensure system improvement and optimisation is continuously managed.
When it comes to implementing SAP, or any other ERP system, it is crucial that these pitfalls are avoided. They cost time, money, and lead to greater inefficiencies throughout the company. It also leaves a bitter taste in your mouth whenever you consider implementing any new system, whereas your experience should be one that proves over and over again its benefits and advantages. That is the mark of a successfully implemented project.
By Paolo Masselli - COO of Britehouse