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Before we do get into the nitty gritty on how to successfully do a Human Resource ERP implementation, let’s take a few steps back in the process and review some of the key reasons that companies use to justify taking on such a challenging initiative.
Large scale, complicated and often expensive Human Resource Enterprise Resource Planning (ERP) projects get initiated for as many reasons as there are applications in the marketplace - by the way there are literally hundreds of systems out there – but we will leave topic for an upcoming blog – that I believe you are going to be interested in reading.
ERP implementation justification can be based in the achievement of a company’s strategic goals or to address numerous business issues.
ERP projects are done for a variety of reasons:
to improve their operational efficiencies
the organization has no centralized application to run their business
IT wants to consolidate and simplify their technical landscape
all the current applications are on their last leg and will no longer be supported
because of mergers/acquisitions which allow Finance to allocate the costs associated with a big implementation into the one time capital bucket of money that they get to spend when those opportunities arise
a CEO reads a five page article in a business magazine while on an airplane
or because believe it or not, the CIO wants to tout this achievement on their LinkedIn profile or speak on the client lecture circuit on behalf of the software vendor – yup that actually was the case with one of my clients about 20 years ago – honest, you can’t make that stuff up! Ego can be a wonderful motivator but may not be the best justification to do an ERP project.
More often than not – it is really a combination of all these factors listed above and many more – but you get the idea.
Bottomline ERP implementations are a company wide initiative regardless of the reasons – everyone at the executive leadership level must be on board and committed to the success of this project.
Don’t have that level of commitment and support? Then the ERP project will feel like you are trying to run a marathon with one arm and one leg tied behind your back – sound like a recipe for failure – because it is.
No matter what the justifications are: whether you are the project sponsor or project manager – as the one accountable to make it happen – you need to ensure that you can define, measure, and articulate the overall strategy as well as define cost reduction factors that are part of your reasoning doing a Human Resource ERP implementation. This is critical to effectively anchor your organization as you move through the entire project life-cycle journey.
Obviously, your organization will have your own justifications for going on the ERP journey but in my mind there are 5 categories that really are legitimate areas that you can feel confident expressing to your Board of Directors regarding making the investment in an ERP application. Yes, you read that correctly investment in an ERP application. Asking your Board of Directors to invest potentially millions of dollars in back office applications needs to be positioned as well thought out and a financially quantifiable investment with clear return rates and organization value that can be quantified from a short- and long-term perspective.
Future blogs will focus on “The 5 Key ERP Implementation Justifications” that should be considered as baseline components that you should include in your model.
Consolidation of Information Technology (IT) Systems
Cost Reduction
Business Process Reengineering
New Application Technology
Bad Decisions Making
Next up – Consolidation of Information Technology (IT) Systems – see you there!!!
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