Project Management Isn’t Enough for Your ERP Implementation
Published On: July 2012
As we all know, many unique and time-sensitive activities occur in all areas of business, government, or even research. Those activities, regardless of their specific nature, can be managed using the project management approach with its associated tools and techniques. This approach is generally intended for assessing the progress of projects and using the necessary and relevant resources of an organization to ensure project effectiveness and completion within planned timeframe and assigned budget.
A software implementation initiative, particularly an enterprise-wide ERP implementation, is a very good example of such a temporary assignment that is usually treated as a project.
For more than 40 years, project management has been recognized as a detached set of techniques that can be applied to any area or discipline. As such, it has been used by hundreds of thousands of project management professionals to manage all types of projects.
However, problems arise when using this approach for ERP implementation. Working with the software end-user community, we here at Technology Evaluation Centers (TEC) often see a number of practical issues with ERP selection and implementation projects. We find that when professional project managers with limited knowledge of complex software, business issues, and industry-specific requirements are assigned to manage ERP implementation projects, those projects usually take longer, cost more, and are more likely to fail.
To find out why, let’s first take a closer look at project management.
Project Management Alone Isn’t Enough
With the mass adoption of project management methodology and the intense promotional efforts of project management professional associations during last few decades, project management has been transformed from a certain skill set to a standalone profession. The project management approach considers managing projects as standalone knowledge and promotes the idea that no matter what industry or business area you are in, different projects have pretty similar processes that you can manage in a similar manner, using the same proven universal tools and techniques.
So we now have a lot of project managers with deep knowledge of project management methodology and good generalized project management skills but no specific business or industry knowledge. This may be fine for some industries or business areas, and probably for some specialized projects. But it doesn’t work for ERP implementation. And the why has to do with the nature of ERP implementations.
If we take the example of, say, construction projects, we can see that the customer is clearly separated from the construction process, which is performed solely by the builder. But this is not the case for ERP implementation projects. First of all, different types of business professionals such as subject matter experts, regular users of the software, and top management must be engaged in the project. And secondly, a project manager without knowledge of the client’s business processes and the software that’s being implemented usually isn’t able to plan the project accordingly and estimate the quality of tasks executed.
Indeed, the matter eventually comes down to the commonly seen premise that ERP implementation tends to be treated like an information technology (IT) project, not a business project, and that it can be delivered as a turnkey. Not so! Some organizations are under the impression that hiring a third-party project management professional with project management skills would be sufficient to run such a project. But this is not the answer, either.
Understanding Both Business Processes and Technology Is Key
You will certainly need a professional project manager or someone who has the skills to track all the current tasks and resources involved and execute the project—in other words, you need someone to ensure that the procedural (technical) side of the project goes without a hitch. However, the planning and quality appraisal stages of the project require business expertise and a good understanding of the scale of work to be executed. Something that project management methodology does not provide.
So the ideal solution to this problem would be to hire an ERP software implementation expert who not only knows your business thoroughly, but also has a working knowledge of the system being implemented. An alternative would be to involve more people from your business and have them play into their strengths, but certainly make the project manager a part of the team. All together, these individuals should be capable of creating the project plan. After that, the project manager will be responsible primarily for executing the plan—the traditional strength of a project manager.