Since over half of all ERP implementations fail, I have long wondered why? I know there are many reasons, but one reason that always seems to make everyone’s top five list is “inadequate organizational change management”. As I’ve thought about this over the years, I have tried to dissect the individual elements of typical organizational change management methodologies to see if anything jumps out.
Most vendors will have something to differentiate their methodology somewhat, but from what I’ve seen, the guts of most effective organizational change management methodologies contain the following basic elements:
· Creating a clear and compelling vision
· Developing and executing an effective two-way communication process
· Identifying stakeholders
· Identifying, quantifying and prioritizing business impacts
· Thinking through org structure changes
· Developing and delivering training to users
· Measuring and tracking progress/readiness
· Post-implementation review/”lessons learned”
As I look at each of these individual elements, I must admit that each seems necessary and important. But when I look at the big picture – i.e. the “forrest” and not just the individual “trees” – I believe the fundamental failure of most organizational change methodologies is that they are all focused on the changes which will occur AFTER go-live and none of them seem to address the important changes an organization should have in place BEFORE go-live. Because most methodologies do not require an organization to implement and demonstrate tangible capabilities first, there is always a certain “leap of faith” that happens at go-live. And some organizations are able to stick the landing, while others stumble.
In my experience, it is far better to implement as many of the supporting business processes as possible in advance of the ERP implementation. In fact, I’ll take it one step farther and boldly state that: Organizations should implement as many of the supporting business processes as possible even before bringing on an ERP solution provider. This has the following advantages:
· Changes are implemented at a pace commensurate with the organization’s maturity without the tremendous financial pressures that come with a fully involved ERP project
· The effectiveness of the implemented changes can be measured and used as a critical readiness metric to help decide when the time is right to bring on the expensive ERP implementation army
· The duration of the ERP solution provider’s involvement is reduced to the absolute minimum because all the things that an organization can and should do on their own have already been done
· The amount of change that must take place at go-live can be reduced by as much as 30-50%
· The likelihood of achieving a highly successful go-live is greatly improved
I know this approach is somewhat radical but, given that half of all ERP implementations still fail, I think a radical change is needed.
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Author: Dave Beldyk is the President and Founder of DABCO Consulting LLC, a strategic partner of Competitive Capabilities International (CCi)
