The Top Five Mistakes Businesses Make When Implementing ERPs
January 13, 2016 Categories: General
Successfully implementing an ERP system can work wonders for a business’s efficiency and productivity. Processes that used to take multiple software systems can all be accomplished within just one. Instead of using guesswork for your forecasting, you can use accurate data. Sales and inventory become much easier to keep track of.
But unfortunately, the road to successful implementation isn’t always smooth. Despite the resources required for an ERP implementation—time, money, and man-hours—sometimes companies end up setting themselves up for failure, instead of success. Here are the top five mistakes that businesses make when implementing an ERP system—and how to avoid them.
- Not getting buy-in from top-level executives. It may seem like the ERP system process is something to delegate down, or something that executives need not be bothered with until further along in the process. In fact, nothing could be farther from the truth. Without strong executive buy-in, an ERP system is doomed from the start.
- Lack of planning. Another big mistake companies can make is being lax during the planning stages. Before you start fantasizing about all the benefits an ERP will bring to your business, make sure you know where your business stands right now.
- Going overboard with customization. Many businesses use a degree of customization with their ERP systems—after all, every company is different. However, when you start customizing feature after feature, it might be a clue that the ERP system you’re using isn’t a good fit. Maybe Sage X3 isn’t the ideal ERP system for your needs; maybe you need to look at Microsoft Dynamics GP, instead.
- Foregoing proper training. In the eagerness to get the system up and running, sometimes companies make the critical mistake of overlooking proper training for employees.
- Not preparing a maintenance plan. Just like a car, complicated software systems need some kind of maintenance plan. Without one, you’ll be caught completely unprepared if the unthinkable happens. (Like if the system goes down. And let’s face it: that happens to the best of us.)
The reason? Putting an ERP system in place will affect the entire business, from top to bottom. This kind of scope requires everyone to be committed to the project, and willing to participate in the process. Without your leaders on board, the ERP ship is bound to flounder.
What are your current processes like? How do you want to improve them? Where are your areas of weakness? This way, when you begin working with an ERP vendor you’ll have a clear idea of the direction you need to go, and what you’ll need your ERP system to handle. And just as importantly, you’ll know what you DON’T need it to handle.
The issue with heavy customization is that it can add unnecessary difficulties into the implementation process, not to mention the obvious addition of more time spent getting the system ready to use.
While this may be done in an attempt to save time and money, that’s the opposite of what happens. If employees aren’t sufficiently trained on how to use the system, they’ll do what anyone does—figure out workarounds, or go back to the way they used to do things. In the worst case scenario, they’ll get frustrated and leave. And that means that all that effort putting in your brand new ERP system has gone for nothing.
Instead of rushing past this important step, make sure you devote the time necessary to making sure that everyone who needs training, gets it. And it doesn’t necessarily have to mean hours spent in a classroom. At TGO, for example, our training offerings include webinars and live online training as well as classroom sessions.
Before you hit “go” on your ERP system, it’s important to have a plan for maintaining the system. And that includes everything from implementing patches and upgrades, to dealing with system failure. If you’ve got skilled and capable IT staff who can handle the job, that’s great; if not, you may want to look into a third-party plan, like TGO’s Financial Systems Assurance plan. With this plan, any time your financial systems have a problem, big or small, help is just a quick phone call away.