Monday, June 9, 2014

ERP Project Failures - Key Reasons !

ERP Project Failures:

Most of the highlighted points posted here are gathered from various sources, through web, Project Discussions, White Papers, my personnel experience and research magazine, I will keep adding the Key Reasons as I get through. Keep a tab on this post if you want to know more…

It’s complicated:

Expect it to be hard than your present legacy system.  The KISS rule – Keep it Simple Stupid – just cannot apply when it comes to many public sector projects and the validation rules that get in are too high for any ERP software to handle.

Take your time:

Don’t wait until your software is about to pack (or Freeze as outdated) it in then scramble about madly for a replacement. This was the first step on the road to ruin for the Queensland Health project worth 1.2 B$ AUD, says IBRS research analyst Sue Johnston.

“People know the old system has an expiry date and they wait until it’s getting critical,” they are left with very minimal time to implement and test the new system and are forced to jump to the new boat without proper testing.

Put someone in charge who knows what they’re doing:

Having someone competent in charge lessens the chance of things going horribly wrong as the person with knowledge can identify a problem by seeing the tip of the ice berg.

Find the right partner:

It pays to test the waters before you tie the knot. Running a small pilot project before going full steam may help ERP implementing company to know for what they are going to opt and pay will help them out in solving their present and future ERP related issues.

Share the bad news early:

When you’ve got bad news, get it on the table as soon as possible, don’t sit on the issue until the last minute before it erupts, this causes irrecoverable damages.

Big Bannered Armatures:

Misrepresented IT skills and experience during the RFP processes and after contract signing failed to resource the project with staff that had the necessary skills to complete the work successfully (the so called “bait and switch” maneuver). This is done my most of the Big Bannered Companies where you go them by their name and brand value in the market without actually testing their present capability to address your issues. They may be a trillion dollar company, it’s not necessary they should have all the solutions for your issues.

Withheld Risk:

Withheld critical project risk information translates to hiding a hurricane forecast to a sailor who is about to sail. Weather he sails or not depends upon the calculated risk taken by the sailor but at least he is well informed about the near future disaster that may threaten his survival.

Influencing Might Be Ideas:

Committed conflict of interest by influencing client’s Project Manager into accepting incomplete work and concealing project risks from senior management so that the software releases could go live or you may create an illusion that you are progressing.

Not Doing your Job:

Being the Project Manager from the client side, the failure to oversee the work of the Implementation Project Manager and establish an appropriate robust acceptance processes appear to have been direct causes of the failure.

Being the client side project manager you will have to keep an tab over project progress and make sure you get everything delivered up to the moment as per approved and agreed upon plan, no backlogged delivery should be accepted.

Baseline Existing Practices:

Failure to baseline existing practices and to establish effective measures for the desired outcomes, Taking some quality time to prepare the existing operating procedures and analysing with the standard of Sigma 4-6 and rate the efficieancy of the process. If major changs are demanded to enhance the existing operating procedures take the time to implement the required major changes and get comfortable with the new process then think about achieving the same through ERP. 

Specific ERP for Specific Project:

Military Organization Implementation, The structure of a military organization and its focus on operational capabilities rather than financial performance meant that using a COTS system that was designed for a profit making organization was a poor fit; hence the right ERP software should be selected for the right project requirement.

Decision Making Authority:

The hierarchical decision making structures in the military were poorly aligned with the governance structure in use by the project (functional sponsors were at times lower in rank than the people whose groups were impacted by the changes). Companies who go for ERP implementation should look their approval hierarchy and make sure the right and relevant personnel approves the request that he should.

Resistance for Change:

It’s common for resistance in any system change in an organization but when something like an ERP is introduced, management should educate the employees and make them understand what change can bring for them and for the organization.  Unwillingness to adapt operating processes to match the capabilities of the software, Focus only on schedule and budget will result lack of focus on actual project performance resulting in quality related issues being swept under the carpet.

ERP Implementation is an Organizational Transformation Project:

Seeing the project as an IT project rather than an organizational transformation project. The importance and involvement given by higher management differs according to this classification of Project.

Shallow Vision:

Lack of experience in large scale, complex integrated systems development and deployment. Organizational silos. Failure to effectively engage all affected stakeholders. Lack of collaboration and a lack of understanding of “change management”. Failure to establish process ownership will lead to straight forward project failure.

Thanks & Regards,
S.Grace Paul Regan

No comments: