Ralph Billington, Managing Director –
Enterprises expend significant resources to evaluate ERP packages and select the one best suited to the specific needs of their organizational structure and business requirements. Ironically, however, they don’t take an equally analytical approach when defining their implementation strategy, selecting their provider or determining and defining the value contributors the program has to deliver against to be a resounding high five.
That’s a problem. First off, implementation comprises the lion’s share of an initiative and determines the ultimate success or failure of an ERP initiative. Mistakes made during implementation account for most of the value leakage that takes place over the long term. In this context, to prioritize package selection over implementation is a bit like agonizing over what kind of hammer to buy when you actually need and should select a carpenter.
More importantly, the approach that most enterprises take to selecting a provider to manage the implementation is inherently flawed, and contributes significantly to the consistent underperformance we see with ERP programs. The problem is that client organizations rely on providers and integrators that have a vested interest in recommending a specific solution that, while it appears focused on increasing the value of the outcome, is in fact driven in part by maximizing the integrator’s involvement and fees. This dynamic leads to over-selling of package capabilities, overselling the business impact the program will deliver (specifically with regard to pre-configured solutions) and a glossing over of business and process challenges that need to be addressed. (“That can always be done on a change order, right?”) The result is often unanticipated customization, significant cost overruns, scheduling delays and lack of ROI.
The alternative is to engage an independent third party that doesn’t have a stake in the outcome and has no incentive to sugarcoat or downplay the potential obstacles and challenges that may occur during implementation. An honest assessment upfront can prevent many unpleasant surprises down the road.