Enterprise Resource Planning(ERP) implementations are always a hard nut to crack. The excitement and superficial engagement at the initial level of the project soon turn into change management issues, budget and time overruns and a disengaged team who want to just abandon the project, even if it means a loss of capital investment.
Reclaiming such a project and bringing it back to life often becomes a herculean task with major cost investments that were found to be not planned for. ROI promises suddenly turn into a virtual mirage, core team members often lose their jobs and positions and the ERP system rapidly seems to be getting consumed by an approaching black hole.
There are four red alerts that an ERP project is starting to experience a free fall being able to address them quickly, helps a company avoid itself go through a cycle of reclaiming the project
The warning signs include:
• Gaps in understanding business need and documenting project scope
• Lack of top management drive
• Project plan delays and milestone failures
• Poor Issue log Tracking and Status Monitoring
Gaps in understanding business need and documenting project scope
The foundation of any ERP success is a clear understanding of the client’s business needs and a clearly documented project scope at a micro level in the form of an FRD (functional requirement document). If an ERP implementation does not start with a sound understanding of the company’s functional needs followed by a well-documented FRD, which should form the basis of the configurations, it is a warning sign that the implementation is not well started. As they say, well begun is half done and this is truly applicable in the case of an ERP implementation
Lack of top management drive
Top management drive is extremely important for the success of any ERP implementation. Lack of it indicates a warning sign that the project might turn into a big failure due to the lack of a team who could monitor project accountability and ownership. A steering committee team consisting of at least one member from the top management needs to meet at regular intervals, throughout the project to ensure the project is working as per the agreed plan.
When key stakeholders who happened to be active in the ERP evaluation and selection process and even at the project kick-off stage, stop attending steering committee meetings, it sends an impending danger signal that the project is losing ownership and is at risk of a failure.
Steering Committee dis-engagement is a clear sign the project is at risk. The project team members will do their best to make business decisions, often in a silo. As a result, change orders will be generated on a regular basis, processes will not be efficient and end users will not be eager to accept the resulting changes in how day-to-day activities will be performed.
Project plan delays and milestone failures
Delays in project plan schedules and failure to deliver milestones on time is a clear warning signal that the project is going off track. Often ERP project plans and schedules stop getting measured from time to time once they are published at the start of the project as the project manager’s start getting busy on managing the day-to-day activities. Issues logs, team meetings, project status reporting, start consuming the majority of a project manager’s daily schedule, leaving little or sometimes no time to update the project plan and measure the real progress.
The lack of an updated project plan is a second sign the project will not be completed on time or on budget. Project team members will get lost focusing on tactical day-to-day activities while critical tasks start getting overlooked and the project getting out of control with failing timelines.
Poor Issue log Tracking and Project Status Monitoring
Lack of Issue log tracking and project status monitoring are critical tools for the success of an ERP project. Project issues logs and status reports can be tedious to create and can be easily overlooked especially when the Steering Committee meetings fail to take place as scheduled.
Critical issues, configurations, and reports seem to get stuck after a certain stage and never get really delivered when issues are not tracked on time. Team member’s start getting anxious and frustrated as new leakages start emerging by the time existing ones are tapped and closed off.
These four warning signs need to be addressed by regulating the entire project governance structure to ensure the project turns successful.