Why you must avoid in-house ERP implementations.
Some of you might think that I am writing this article so that I can promote our services. Not entirely true. In fact, it has been proven time and time again that dedicated partner companies that are focused on providing ERP Implementation Services make more money from these projects than others. Within this article I will be brief and to the point on why I am saying that from past experiences:
1. Team Leadership – To ensure success you need an experienced project team leadership. This experience does not come easy or cheap, nor from education or certification. It is gathered over many years of similar implementations. This individual must start his/her career in the basement so to speak, and later gets promoted to upper positions within the team until the individual attains the leadership status and all that it brings with it in the form of maturity and responsibility.
Recently I came across two cases at companies that had failed in-house implementations. They both were under the impression that nobody knows their company more than them, and the assigned team leader felt threatened if outsiders were allowed into his/her domain, so they promised their management the moon and the stars. However, in those cases these individuals lacked the experience a partner company brings to the table from hundreds of other projects, and access to a massive knowledge base provided to them from the vendor. In fact, while believing they can save money that way, those projects took a lot longer than planned. Eventually, they ended up going back to a partner company, both costing them a lot more money and time than budgeted.
How do I judge a successful team leaders? Two things; Age and experience. The team leader should realistically be 35+ years old who has been in the business for 10-12+ years at least, having been on ERP implementation teams on dozens of projects. This will bring the sought-after experience and maturity.
2. Team Experience – In-house implementation teams might have one or two of the required skill sets, but not all. The IT Department usually has enough experience to manage the infrastructure and some applications, but definitely not an ERP project.
Specific experience or skill sets will include consultants in finance, supply chain, logistics, retail, manufacturing, services, projects, developers etc. However, they must also be coupled with experience in the specific ERP procured.
Back to the cases mentioned above, the in-house team had one or two of the skill sets, but not all.
3. Time Management – What in-house teams do not take into consideration is time. In today's business world, everyone has KPIs, individuals and departments. Successful companies design those KPIs in order to utilize 100% of the time of the employees. So, what is left to the ERP and adhoc projects? Almost nothing if not taken into account. Hence missing deadlines.
ERP projects require a lot of dedication and time from many people within the organization (Champions). If KPIs are not adapted for the duration of the project, time and deliverables will take a back seat. Thought; have you thought of canceling vacations during the critical phases? As a partner we demand it.
4. Project Methodology – Vendors have their own approved methodologies. They have to be adhered to, no question. It is highly advisable not to try to adapt other vendors methodology thinking that because it worked in your old job, it will work here. In addition, today the methodologies are cloud based, they are different than traditional on-premise plans and get adapted just as frequent. In fact, they are tied to the partner company’s accredited resources which means the vendors can only support the project when the methodology is compliant.
An ERP implementation is a once in a lifetime project per company. Don’t beat your chest thinking you can do it. 95% of the time you can’t, unless you have a lot of money and time to burn.
5. Technical Experience – The larger the company, the more customizations and integrations will be needed. That is when all the above points become more and more important; certifications, business and technical knowledge, access to vendor knowledge bases, and of course experience is above all. Experienced individuals and companies usually can provide multiple options instead of always fall back to development.
Back to the cases mentioned above, the IT internal wanted to prove their importance and prowess in database development ending up with a ‘swiss cheese’ of a system that either crashed al lot or was slow in other times in the short term, and un-upgradeable in the long term.
As a final thought taking the above points into account; I suggest seeking external consulting that can help you establish the project, the responsibilities and project boundaries. This would be a focused assignment that will set all the expectations accurately from day one.