In the past decade a big behavioural and management change has come to the business forefront. A distinct change in the business environment means new requirements in the systems used for managing the business as a whole. A big hype has been generated around the use of ERP systems and the functionality and effectiveness thereof. Its implementation has seen increased significance in various different sectors and is researched far and wide.
ERP systems are used in the case of large scale information processing and functions as a tool for managing enterprise resources. This includes finances, human resources, assets and inventories to achieve breakthrough performance. This is done by re-accessing the key methods and techniques within a business and generating a model that will increase functionality and work flow within the business. These systems have greatly advanced since its first introduction to the market. Most systems now operate fully within the cloud, allowing for optimum visibility and control.
The successful implementation of such a system requires thorough research and work from both parties. As stated by Bill Gates “The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.” In many cases the systems, along with the companies that implement them, have seen immense improvements and great success when implementation is done correctly. The biggest throwback unveiled by research places emphasis on the resistance from staff to change their behavioural patterns, attitudes and perceptions of top management, technical proficiency of individuals, training and education, and organizational culture and structure.
Successful change management requires a detailed plan for making individuals aware of the change and counteracting resistance in acknowledging each employees’ work environment. Making the employee understand the change and respecting that it is a process for both the employee and management. It is also an important factor to clarify the benefits of the implementation and how this will effect the growth of the company. When the possibilities created by change are explained, the employee can be more prepared to take advantage of the situation, rather than fear the change.
Another major pitfall in an implementation is the technical skills required to operate the system. It is becoming increasingly important that training is provided to all staff members. Without the appropriate training it is simply impossible to use the system to its full capacity. It’s important to remember that not all staff members are equally experienced with the software and that each team member should understand the system well enough to complete what is required and in the correct manner.
Research conducted by Gargeya and Brady on the common circumstances that occur with ERP implementations found with the failure of 15 ERP implementations, that the biggest reason were the lack of appropriate culture and organisation (internal) readiness. The biggest contributor for successful ERP implementations was the presence of project management approaches and appropriate culture and organisational (internal) readiness.
In conclusion, an implementation can only be done successfully if it is setup according to an appropriate and well researched plan with key success factors that include Change Management, appropriate training, project management approaches, an appropriate culture and organisational readiness.
“Adapting To Change In A Rapidly Changing Business Environment – Fmlink”. FMLink. N.p., 2016. Web. 13 Mar. 2016.
Mitra, P., & Mishra, S. (2016). Behavioral aspects of ERP implementation: A conceptual review. Interdisciplinary Journal of Information, Knowledge, and Management, 11, 17-30. Retrieved from http://www.ijikm.org/Volume11/IJIKMv11p017-030Mitra2069.pdf
Success and failure factors of adopting SAP in ERP system implementation
Gargeya V.B., Brady C., (2005) Business Process Management Journal