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ERP (ENTERPRENEUR RESOURCE PLANNING)

We have been hearing about these “three letters” for quite some time now. This article is just an attempt to throw an abstract light on some of the aspects of ERP.
ERP is often referred as the mother of all software systems, as it touches every aspect in an organization. Also the full implementation cycle of ERP is likened to the child birth. A mother conceives and delivers the baby after 10 months. In the same way, the final deliverables in a normal ERP implementation takes about 10 months to materialize. Just as the mother undergoes labour pains while she gives birth to her child, the Company undergoes several pains during its implementation like resistance from the staff to change from the existing system and set up etc.,. During the first two years the new born baby gives lots of troubles to the mother and he/she has to be always cared for. ERP also gives plenty of troubles in the initial two years after implementation and needs constant watch from a dedicated person. Similarities go on…

The basis of all ERP implementation is a combination of three factors – People, Process and Technology. It is all about transforming the business performance through successful integration of the three factors mentioned above. Since ERP brings about changes within the organization, let us examine its impact on these three factors.

People

Team work and user participation are the keys to the successful project implementation. Generally it has been observed that companies have to face stiff resistance from the staff who refuse to adapt to the new set up. Lots of counseling and training has to be given to alleviate the problem.

Process

The selection process of ERP also gives rise to lots of problems. Everyone wants the best and many companies select the system without giving thought to the relevance of the same to their company. Unless companies give attention to this fact, the full benefits cannot be reaped. There can be situations of cost and schedule overruns. The packages selected may not meet the expectations and due to poor project management, several technical problems can arise.

Technology

Since the technology is new, several teething problems can arise. Generally the ERP Journey in an organization starts with the Strategic planning. Then the Business requirement is assessed and the right package is selected and accepted. Subsequently, the design phase starts which leads to the configuration and implementation, and finally the “go alive”. After this phase, for the successful running of the system, adequate support and monitoring is absolutely necessary.
Let us also examine some causes of failures which some organizations had to face after implementing ERP

  • One reason attributed to the failure is the inadequacy of proper project management right from initiation to implementation.
  • Another cause is the selection of the improper hardware and software.
  • The system also fails if the Company and the consultant are unfamiliar with the scope.
  • The complexities of the system and the failure to define the objectives are another contributing factor.
  • Then the most important one is the lack of proper communication at all levels.
  • There can be several hidden costs which were not anticipated during the design stages
    ERP can be made successful only if the consultant and the company adopt a partnership approach to ensure a smooth transformation of the technology. A good consultant should be able to erase all issues mainly connected with the people affected by the change. He should be able to properly deal with the trauma and negative approach to the change and motivate the people affected, to make them comfortable.