SAP B1 blog

Problems in the ERP project: Missing corporate strategy

The misconception of medium-sized companies that they can overcome the upcoming difficulties with the help of new technologies is widespread. In doing so, they forget that these technologies are only the tool and only gain a foothold with a good corporate strategy.
The successful introduction of a ERP system is therefore inevitably linked to the fact that the project has a well thought-out corporate strategy at its disposal. If this is missing, no software in the world can guarantee success.

Before starting the project, an effective corporate strategy must first be developed. It can help to set some goals, such as:

• Will new business areas be opened and what are they?
• What markets is the company targeting?
• When does the company want to be where?
• Which direction does she want Managing directors generally aim?
• What competitive advantage does the company have and how should the organization define or enhance it?

Problems in the ERP project: Missing ERP strategy

Based on these goals, you can now define the ERP strategy. At this point at the latest, the need for a corporate strategy becomes clear, because it is only on the basis of this that one can, for example, determine which work processes are to be used with the Optimize ERP want. So, with one of these strategies, the company can determine where they want to use the ERP to increase efficiency. If you introduce the ERP without such a coordinated strategy, the long-term success of the system in the company will suffer.

Problems in the ERP project: Different ERP and corporate strategies

Another problem is the lack of adaptation of the ERP strategy to the changing corporate strategy over time. It is normal for the objectives to develop over the years under the conditions of, for example, new products, changing markets or changing competitors. However, the ERP strategy then has to keep up and adapt to the new target conditions. Otherwise the ERP system can no longer guarantee optimal efficiency for the company.

Problems in the ERP project: The importance of the analysis phase is not recognized

The next problem often poses the analysis of the ERP project. In order to carry out an analysis, it is assumed that the company is aware of the business and ERP strategy. However, it is often not entirely clear with what goals the ERP solution is to be used in the precise sense and which steps are necessary for this. In addition, the time required for this is often underestimated. Depending on the size of the company, 3 to 100 man-days are required for the analysis needed. In this phase, the customer can analyze and structure their own work processes and goals together with the ERP provider so that they are not lost during the project. In order to guarantee the success of the ERP, however, companies must work out these points. Here some examples:

• Which core processes and core business areas does the new software have to map?
• How much time does data migration or old data cleansing require?
• What happens to orders that were placed before the changeover, but are only performed and/or charged afterwards?
• How are open invoices treated?
• What do you have to take into account for remaining services?

Problems in the ERP project: the schedule is calculated incorrectly

Another possible problem is the general time requirement or time pressure ERP project. Those involved often underestimate this. In order to be able to start with the ERP system on the planned date, for example test phases, urgent adjustments or necessary training courses no longer realized. Therefore, it is important to set the schedule in advance, to include the budget plan and to keep an eye on the schedule during the project.

Problems in the ERP project: Neglect of project controlling

Services account for between 10 and 20 percent of a project volume in an ERP project. Many of the medium-sized companies do not know how much time and financial resources controlling, monitoring and management of such a project needs. In addition, the service provider needs support from an internal project manager.
The tasks of this project controlling are:

• Keeping an eye on costs, deadlines and benefits and intervening if necessary, e.g. in target planning or budget
• If the need for change arises, perceive it and implement it. If goals or conditions change, the successful implementation of the project can often be better achieved in a different way.
• In order to optimize the project, it also happens that internal changes have to be made. Recognizing and implementing this is also the task of project controlling.

Problems in the ERP project: Lack of support from management

In order to carry out a project successfully within the company, it often requires additional work from the individual employees. To do this, the person responsible for the project must be released from his or her normal tasks. This leads to dissatisfaction with the project and can cause it to fail. To prevent this, the Managing directors Do project marketing in your own company and convince the affected employees that the additional work is currently paying off for them.
In addition, management must service provider work together and clearly define the tasks in responsibility. In addition, those responsible should always have an open ear for the (interpersonal) tone and promote understanding between the project participants.

Problem 8: Data migration is underestimated

In the data migration not only old data is transferred from the previous system to the new one. You have to clear out old files, delete inactive data records and invoices that are ten years old. Product information for products that are no longer sold should be left out anyway. Other data, on the other hand, must be restructured or processed. The effort required for this task is therefore often underestimated. However, if you don't accept this, you carry the burden of the old data with you into the new system.

Problems in the ERP project: Is not approached methodically and with foresight

The service provider can also be the cause of problems when introducing an ERP system. For example, if he does not bring any project methodology with him, as this serves as the basis for the undertaking. From the analysis to the offer, contract and the project itself, you should proceed methodically. The individual progress should be defined and documented.

In addition, it is like this: Projects that start small and only grow later are often more successful. This is because only 80 percent of the requirements made of the system actually make sense and the other ten percent only bring little added value, but have cost a lot of effort and money. This means that smaller projects that do not cover all wishes right from the start are often more effective and better for the company than large projects.