ERP Implementation challenges

makes you aware of Implementation challenges in ERP

1. Unit 2 ERP Implementation

2. Implementation Challenges

3. Implementation Challenges There are few information system whose design and implementation challenge a company like ERP. A new ERP implementation can dramatically improve business process. But when an implementation fails or takes a prolonged and huge amounts of money and effort could be misspent(unwanted expenses)

4. Challenges to Successful ERP Implementation Inadequate Definition of Requirement Resistance to change Inadequate Resource Inadequate Training and Education Lack of Top MGMT support Unrealistic Expectations of benefits Miscalculation of time and efforts Poor communication S/W business process incompatibility Poor Project design and MGMT Poor ERP package selection Other

5. Challenges to Successful ERP Implementation ERP implementation are more likely to fail, be delayed, cost more than forecast or fail to deliver full functionality than they are to succeed It is important to be aware of how ERP as a technology evolved, what its strengths and weaknesses are and the nature of important implementation challenges

6. Inadequate Definition of Requirement Inadequate definition of requirements is on of the major challenges faced by the implementation team. The requirements definition should clearly specify the issues and problems that the ERP system is supposed to solve. If the requirements are properly specified then the implementation team can go about their job including selection of the ERP package that is best suited to meet these needs, the area where customization is needed.

7. Inadequate Definition of Requirement Failing to provide these (which is the managements responsibility)could result in the selection of the wrong ERP package, unnecessary customization, lack of employee re-training and so on, all of which can result in the failure of the ERP implementation.

8. Resistance to Change Implementing an ERP system is a change and it is human nature to resist change. So any ERP implementation will face some amount of resistance. User will be skeptical (dilemma) about the new system. But for successful implementation of ERP the co-operation of every one is required .

9. Resistance to Change ERP is first an attitude, then a system. So if employees are not convinced about the importance of ERP and the benefits of using an ERP tool or system they will not be fully co-operative. Which can result in the failure of the system.

10. Inability to Achieve Organizational Understanding The biggest ERP challenge faced by organizations is recognizing that the integration of previously un-integrated job functions requires that knowledge/expert workers support. Understanding has a specific definition in an ERP context: “Understanding an architecture” indicates that the organizational legacy systems and the ERP are documented and articulated(expressed) as a digital blueprint illustrating the interconnections among the component metadata.

11. Inadequate Resources ERP implementation is a very costly matter that requires a variety of resources- money, manpower, s/w, h/w, and so on. It is not like that the company mgmt would support the idea of unlimited funding for ERP implementation project. Instead of that it should from control stance (point of view) a budget needs to be established.

12. Inadequate Resources And this will be based on an estimate of the likely costs. There are many things/items that will be missed during the preparation of the budget but will consume money during the implementation The long implementation duration will escalate (increase) money costs. Getting the right persons with necessary skills, aptitude and enthusiasm is one of the most difficult tasks faced by ERP implementation team.

13. Lack of Top Management Support The commitment of top management to the diffusion(spread) of innovations throughout an organization has been well documented. In initial project’s life, no single factor is responsible/predictive of its success as the support of top management The role of top mgmt , in IT implementations include developing an understanding of the capabilities and limitations of IT, establishing reasonable goals for IT systems, strong commitment to the successful implementation of IT and communicating the corporate IT strategy to all employees. So going ahead without solid backing from top management is a sure for disaster.

14. Lack of Organizational Readiness The management should make sure that the organization, the work process and the employees are amenable(ready/willing) to adapt to the ERP system.

15. Inadequate Training and Education The role of training to facilitate software implementation is well documented in the Management Information System (MIS). Lack of user training and failure to completely understand how enterprise applications change business processes frequently appear to be responsible for problem ERP implementations and failures. ERP projects appear to have a 6 month learning curve at the beginning of the project.

16. Inadequate Training and Education Minimally persons who uses ERP system need to be trained on how they work and how they relate to the business process early on in implementation process. Although many companies use consultants to help during the implementation process, it is important to transfer that knowledge from consultant to internal employee through training.

17. Inaccurate Expectations Information system failure has been defined as the inability of an Information System to meet a specific stakeholder groups expectations and successfully managing user expectations has been found to be related to successful system implementation. The expectations of a company may exceed the capabilities of the system. ERP systems may fail to meet expectations despite positive contributions to the organization if , the systems are oversold by the vendors.

18. Poor Package Selection Selecting a good ERP solution provider is another challenge. Analyze the capabilities of the ERP service provider and make sure the provider has the capabilities and the expertise to provide you with a good solution. The choice of the package involves important decisions regarding budgets, time frames, goals and deliverables that will shape the entire project.

19. Poor Project Management Project management activities span the life of the project from initiating the project to closing it. The project planning and control is a function of the project’s characteristics such as project size, experiences with the technology and project structure.