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Busting ERP myths- RP has had a bad rep in the past for being costly, complex and unwieldy. But manufacturers and other companies considering installing or updating their ERP solution need to know that now is the time to do it.
“ERP software and services have improved dramatically in recent years,” says Lyall O’Carroll, Technical Account Manager, Seidor Africa. “It is no longer an enormous expense, nor does it take an age to implement. ERP has also become much easier to use.”
O’Carroll looks at four of the most common myths that persist around ERP implementation and how to bust them:
Myth 1: When ERP projects crash, it’s ugly
Saying that ERP projects crash is a provocative way of saying they have failed. But to understand if something has failed, we need to comprehend what the starting goals of the particular project are. The reasons driving an ERP project may be unique or generic, but typically fall into four areas:
- To develop the brand
- To improve gross profit
- To increase turnover
- To align governance
When evaluating ERP solutions, the leading question should be around growing or protecting these four key areas, the return on investment (ROI) needs to be proven, and should outweigh the investment required.
If the ROI does not have a start and end date, then it is without substance and cannot be proven. This means further investigation is required.
From a service provider’s point of view, an ERP implementation fails when it does not answer the key questions or meet the primary goals agreed to at the onset.
It is also important to note that the advantages of ERP are not limited to streamlining business operations and cutting costs. Even a problematically implemented ERP system can help companies serve their customers better by improving efficiency and control of the business processes.
Myth 2: Millions are lost in failed ERP implementation costs
This is a myth that needs to be contextualised. Anything can go wrong, given enough scope and time, but what is key is the client and service provider relationship. They should be clear and agree on the scope and objectives of the project while maintaining a partnership that fiercely drives the project to that end.
According to Murphy’s Law “If nothing’s wrong, you’ve missed something”. It is naïve to think that any project will run without a hitch and at the same time, there is also no room for failed implementations which is why best-business practices are adopted. Understanding future roadblocks, resolving them as early as possible, maintaining regular open communication whilst respecting the project goals and budget reduces the risk as well as cost and time overruns which directly effecting the project success.