Introduction
Change is tough! Period. The number of partial or complete ERP implementation failures caused by a lack of proper strategy for change management is amazing. When organizations implement an ERP system, there is invariably resistance from almost every level in the organization. There could be a variety of reasons for this resistance including employee job security, the fear of the unknown, a general aversion to change, a lack of dynamism in the organization’s culture (the organization has never re-engineered its business processes), a lack of skills to learn new systems or ways of doing things, a lack of appreciation of the gains, personalities
or a combination of these. This article looks at some of the key aspects of managing change due to an ERP system implementation in an organization.
Management Support. An ERP is not a single-person, single-team or one-department system. It’s a combination of systems and processes with elaborately detailed integration between these systems and processes. Regardless of which ERP, an ERP more or less literally touches each job role within the organization. Without complete appreciation and support from the senior management of the organization, the success of an ERP implementation is almost bound to fail. Therefore, it is of utmost importance for management to spread awareness across the organization about the priority and significance of the implementation to make sure that there is due diligence of contribution at each level and throughout the process of implementation. All that begins well ends well – this statement is very much valid in this context and if it doesn’t begin well, it doesn’t end very well either.
Debunk the "Golf-course" Myth. Whenever there is a new system or tool introduced in an organization, there is typically the view that the decision was made in "golf course" without due diligence in weighing the capabilities of the system. Although there is the occassional exception that such a decision could have been really made in a "golf course" fashion, it is truly an exception. Typically, whoever spreads these words does not really understand the true potential of an ERP system as an integrated set of systems and processes, but rather tend to view things from a specific "technical silo". Propagators of such a message in the organization could really cause damanage to team morale and if they are strong enough influencers, could cause an implementation failure. It is imperative for the management at all levels to work with their peers and teams to promote a positive appreciation for the new system taking a wholistic view and explain why it is important to make some compromises at a micro level, in view of the macro level benefits brought about by the new system.
Adopt the Adapters, but Manage the Others. It is important to identify and nurture the new technology adapters in the organization early on in the game. However, it is also important, and in some cases, it is more important to properly manager those that don’t get in the bandwagon in the early stages. If not managed properly, they could become show stoppers or may slow down the process at every step going forward. It may be necessary to persuade them by spending more time with them, listening to their points of objections, assign more responsibilities and engage them in the decision making process, etc… Nevertheless, the changes in job roles and responsibilities must be properly communicated to all stakeholders early on in the process.
While grooming the adapters in the new systems, it is also important to avoid creating political groups. This is bound to happen to some extent in every organization, especially between the BPO’s and the rest of the user groups, but it should be dealt with and minimized right from the beginning. If not dealt with, it will create pessimism in the organization, result in low employee morale, and may cause process inefficiencies down the road.
Complementary Training. There could be complementary training necessary for many employees to enable them to perform their new job role more efficiently and make the transition smoother. It could be sometimes a more formal MS Office (e.g. Excel) training. Depending on the person’s role in the organization, a combination of skill and/or responsibility orientation (e.g. role of a purchasing agent or a project manager) could help the employee approach the new system with a more positive and open-minded perspective than that without such academic training. Especially, in organizations that have grown from boutique firms through mergers and acquisitions into bigger organizations or became part of a bigger organization, such reorientation in terms of job roles and responsibilities becomes imperative. If not done properly, the employee may never be able to own the new system.
Emphasize Job Security. Although it might result in the elimination of certain redundant job roles in the organization, an ERP is intended to give organizations a competitive edge in terms of efficient business processes and integrated information processing, so that the organization could focus its energies in improving effectiveness and innovations rather than chasing its own tail to keep operations running. Moreover, early participation and contribution to the ERP implementation will nevertheless make the business user more valuable to the organization. By building experience and expertise in the new systems, the business user is bound to become indispensible for the organization. Additionally, in today’s competitive career world, an ERP system certainly adds value to a business users profile and improves his/her marketability. It can be easily seen on job boards that employers tend to be preferential to business users with experience in systems than those that do not have the experience. If this aspect is highlighted to the employee, it would certainly prove to be a morale booster.
End User Training. Make no mistake. Whatever training approach is adopted (e.g. train-the-trainer), each person that fits into one or more ERP job roles must be trained to understand the width and breadth of his job role and handshaking points with other departments and/or job roles. Additionally, it is also important to cross-train people on relevant and adjacent job roles so that brain drain and attrition could be efficiently dealt with.
Workforce Stability. One of the most important aspects during the implementation and stabilization phase of an ERP system is workforce stabilization. Almost no organization can sustain aggressive and constant changes in management structure or attrition during the implementation and stabilization phase of an ERP system. Other than those changes needed for the implementation itself – such as redefining job roles and responsibilities or reorganizing certain departments, no major organizational changes should be entertained. This will seriously damage employee morale and provide inconsistent and often contradicting direction to staff leading to nothing but disaster.
The ERP Consultant. The ERP consultant should play a key role in the whole equation, because the consultant is not only responsible for configuring and testing the system according to the client’s needs, but he/she should act as the liaison between stakeholders across the organization to make sure that process flow is properly defined and ensure proper handshaking between interdependent departments. When people ask the question, “why are these guys paid so much?”, this could be the single reason why an ERP consultant is and should be paid the premium dollar, if any. The configuration of the system can typically be completed by an ERP business analyst, but the application of the “soft skills” to accommodate for different viewpoints, yet make sure that the industry best practices are provided to the organization to give them the competitive edge through the implementation of an ERP system falls on the shoulders of the ERP consultant.
As you can see, this is by no means a comprehensive change management guide for ERP implementations, but the intention is to highlight the most important aspects so that a project team going into an implementation could go in with the proper frame of mind into the implementation. I truly wish to welcome discussions on this topic from all you experts with industry experience.
Change is tough! Period. The number of partial or complete ERP implementation failures caused by a lack of proper strategy for change management is amazing. When organizations implement an ERP system, there is invariably resistance from almost every level in the organization. There could be a variety of reasons for this resistance including employee job security, the fear of the unknown, a general aversion to change, a lack of dynamism in the organization’s culture (the organization has never re-engineered its business processes), a lack of skills to learn new systems or ways of doing things, a lack of appreciation of the gains, personalities
or a combination of these. This article looks at some of the key aspects of managing change due to an ERP system implementation in an organization.
Management Support. An ERP is not a single-person, single-team or one-department system. It’s a combination of systems and processes with elaborately detailed integration between these systems and processes. Regardless of which ERP, an ERP more or less literally touches each job role within the organization. Without complete appreciation and support from the senior management of the organization, the success of an ERP implementation is almost bound to fail. Therefore, it is of utmost importance for management to spread awareness across the organization about the priority and significance of the implementation to make sure that there is due diligence of contribution at each level and throughout the process of implementation. All that begins well ends well – this statement is very much valid in this context and if it doesn’t begin well, it doesn’t end very well either.
Debunk the "Golf-course" Myth. Whenever there is a new system or tool introduced in an organization, there is typically the view that the decision was made in "golf course" without due diligence in weighing the capabilities of the system. Although there is the occassional exception that such a decision could have been really made in a "golf course" fashion, it is truly an exception. Typically, whoever spreads these words does not really understand the true potential of an ERP system as an integrated set of systems and processes, but rather tend to view things from a specific "technical silo". Propagators of such a message in the organization could really cause damanage to team morale and if they are strong enough influencers, could cause an implementation failure. It is imperative for the management at all levels to work with their peers and teams to promote a positive appreciation for the new system taking a wholistic view and explain why it is important to make some compromises at a micro level, in view of the macro level benefits brought about by the new system.
Adopt the Adapters, but Manage the Others. It is important to identify and nurture the new technology adapters in the organization early on in the game. However, it is also important, and in some cases, it is more important to properly manager those that don’t get in the bandwagon in the early stages. If not managed properly, they could become show stoppers or may slow down the process at every step going forward. It may be necessary to persuade them by spending more time with them, listening to their points of objections, assign more responsibilities and engage them in the decision making process, etc… Nevertheless, the changes in job roles and responsibilities must be properly communicated to all stakeholders early on in the process.
While grooming the adapters in the new systems, it is also important to avoid creating political groups. This is bound to happen to some extent in every organization, especially between the BPO’s and the rest of the user groups, but it should be dealt with and minimized right from the beginning. If not dealt with, it will create pessimism in the organization, result in low employee morale, and may cause process inefficiencies down the road.
Complementary Training. There could be complementary training necessary for many employees to enable them to perform their new job role more efficiently and make the transition smoother. It could be sometimes a more formal MS Office (e.g. Excel) training. Depending on the person’s role in the organization, a combination of skill and/or responsibility orientation (e.g. role of a purchasing agent or a project manager) could help the employee approach the new system with a more positive and open-minded perspective than that without such academic training. Especially, in organizations that have grown from boutique firms through mergers and acquisitions into bigger organizations or became part of a bigger organization, such reorientation in terms of job roles and responsibilities becomes imperative. If not done properly, the employee may never be able to own the new system.
Emphasize Job Security. Although it might result in the elimination of certain redundant job roles in the organization, an ERP is intended to give organizations a competitive edge in terms of efficient business processes and integrated information processing, so that the organization could focus its energies in improving effectiveness and innovations rather than chasing its own tail to keep operations running. Moreover, early participation and contribution to the ERP implementation will nevertheless make the business user more valuable to the organization. By building experience and expertise in the new systems, the business user is bound to become indispensible for the organization. Additionally, in today’s competitive career world, an ERP system certainly adds value to a business users profile and improves his/her marketability. It can be easily seen on job boards that employers tend to be preferential to business users with experience in systems than those that do not have the experience. If this aspect is highlighted to the employee, it would certainly prove to be a morale booster.
End User Training. Make no mistake. Whatever training approach is adopted (e.g. train-the-trainer), each person that fits into one or more ERP job roles must be trained to understand the width and breadth of his job role and handshaking points with other departments and/or job roles. Additionally, it is also important to cross-train people on relevant and adjacent job roles so that brain drain and attrition could be efficiently dealt with.
Workforce Stability. One of the most important aspects during the implementation and stabilization phase of an ERP system is workforce stabilization. Almost no organization can sustain aggressive and constant changes in management structure or attrition during the implementation and stabilization phase of an ERP system. Other than those changes needed for the implementation itself – such as redefining job roles and responsibilities or reorganizing certain departments, no major organizational changes should be entertained. This will seriously damage employee morale and provide inconsistent and often contradicting direction to staff leading to nothing but disaster.
The ERP Consultant. The ERP consultant should play a key role in the whole equation, because the consultant is not only responsible for configuring and testing the system according to the client’s needs, but he/she should act as the liaison between stakeholders across the organization to make sure that process flow is properly defined and ensure proper handshaking between interdependent departments. When people ask the question, “why are these guys paid so much?”, this could be the single reason why an ERP consultant is and should be paid the premium dollar, if any. The configuration of the system can typically be completed by an ERP business analyst, but the application of the “soft skills” to accommodate for different viewpoints, yet make sure that the industry best practices are provided to the organization to give them the competitive edge through the implementation of an ERP system falls on the shoulders of the ERP consultant.
As you can see, this is by no means a comprehensive change management guide for ERP implementations, but the intention is to highlight the most important aspects so that a project team going into an implementation could go in with the proper frame of mind into the implementation. I truly wish to welcome discussions on this topic from all you experts with industry experience.
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