How you select new enterprise resource planning (ERP) software will greatly affect your company’s future and should not be taken lightly. Therefore, in order to avoid unpleasant surprises or failure, you should start thinking about change management at the same moment that you start considering replacing your old or buying new ERP software. Do not wait until there’s no turning back. Remember: prevention is better than a cure.
This is the first of a series of four blog posts in which I intend to describe how change management can affect a company’s ERP software selection project.
Part 1 (Introduction): I will describe the challenges a company faces when managing the change caused by the replacement of its ERP system.
Part 2 (The Change): I will show the difference between general change in a company (e.g., management team, moving to new offices, etc.) and change during an ERP selection process.
Part 3 (The Management): I will describe the different methods and tools used to manage change during an ERP selection project.
Part 4 (Conclusion): I will provide a plan that companies can use when managing change during an ERP selection process.
Change Management Challenges that Companies Face during ERP Software Selection
Probably one of the most important challenges is internal communication. Even before starting the selection process, all parties involved should know what is going to happen and why the decision to buy or replace the current ERP software was made. The decision to replace the existing ERP solution should be discussed with the employees. Of course, in companies with hundreds of users, the chief information officer (CIO) or chief technical officer (CTO) will not speak to all of them; but there are other ways to find out what they think by using surveys, polls, etc.
After the decision to replace the system is made, the next challenge is to define a strategy that will make the selection and implementation process as painless as possible (i.e. a plan of action to accomplish a specific goal). It doesn’t have to be very detailed, but it should contain the risks faced during the implementation process and the ways to deal with them. No matter what vendors tell you, there is no project with zero risk.
Now that you have created a strategy, you will need to find people who can implement it. No matter the size of the project, you will need to create a team for the ERP selection project, made of people from different levels and different departments and led by a project manager whose main task is to supervise all actions related to the project. When building the team, try to select people who will be willing and available to work on the project (do not take very busy people or employees that are likely to leave the company).
No matter who makes the decision that leads to an ERP selection, or who manages the project, all the employees in the company will be affected. Therefore, everyone should be involved and allowed to contribute. In order for that to happen, transparency is extremely important because people cannot get involved if they don’t know what’s going on. All employees (from users to top managers) should know what’s going on and have the opportunity to give their feedback on the project.
Another important challenge is external communication with software vendors, consultants, or companies offering software selection services. If you’ve already addressed the challenges mentioned above, it will be much easier to work with vendors, consultants, or software selection companies.
Please remember that these challenges are related to change management for an ERP selection project. Ideally, these challenges should be addressed before you start the selection process, and not along the way.
In my next blog on change management, I will define change and describe what makes it such an important issue during an ERP selection process. In the meantime, please let me know what your thoughts are on change management and on this blog post.