5 common risks and challenges in ERP projects - and how to avoid them!

If you’re about to start your ERP journey and wondering what to look out for, then you’re in the right place. We’re breaking down the five most common risks and roadblocks that we see with ERP projects – and sharing exactly what you need to do to avoid them.

Risk #1: You don't have executive sponsorship or buy-in before you implement

Simply having an ERP doesn’t guarantee you much. To start achieving results, streamlining workflows, and improving your operational efficiency, all levels of your organisation need to be on board. Even the best ERPs out there won’t achieve ROI (return on investment) if they don’t have strong executive support.

That’s why businesses can sometimes fall into transitional difficulties: misalignment within their team. To make the most of your technical solutions, you need to have a united front - there is a direct correlation between project failure and poor rates of adoption!

Solution:

Get your leadership team engaged with and excited about your ERP implementation project and the benefits it will bring. That way, they can communicate the vision to the wider business and help foster a culture of enthusiasm for its potential.

Encourage people to ask questions and become involved in the decision-making process and help shape what your new ERP will be. That way, you’ll have more engagement and commitment across your business before introducing your new ERP – and a keen interest in its evolution.

Risk #2: You don't have the right expert knowledge throughout the project to handle technical issues

ERP projects bring together people at all levels of an organisation. By combining complex technology with operational strategy, ERPs allow your business to achieve more. That level of complexity can require highly specialised technical expertise, which businesses may lack among their internal staff members.

Solution:

To make sure all your bases are covered, it’s important to build a clear project governance framework, to ensure your ERP project has good structure, communications, and alignment of key stakeholders. Your project team may include key roles like a senior executive, a project manager, a savvy end user, a report writer, and experts in IT and finance. Consider what expertise you have on your team and where the gaps might be. Bringing in an experienced implementation partner to help guide the transition process and provide technical knowledge can ensure that your ERP project goes smoothly and that all your expert bases are covered.

Risk #3: You don't have defined business needs or clear project goals

It may sound obvious, but starting with a plan is crucial to a successful ERP process. It is all too common for businesses to begin their ERP project without a full understanding of the scope, timeframe, or specific outcomes they want to achieve. While the drive is excellent, this can lead to inefficiency and hiccups throughout the project. It also means that businesses will start without an accurate understanding of what the investment will look like to complete the project.

Solution:

Plan, plan, plan. Before you begin your ERP project, you need to paint a full picture. Be sure you can answer these questions:

• • What are our intended outcomes?
  • What resources will this take?
  • What are the phases of this project, and how long are they likely to take?

You’ll need a clear structure for decision-making, and management to support consistent, efficient progress throughout the project. This will help ensure that when questions do arise, you have a clear system for making final calls and preventing costs and timelines from spiralling out of control.

The secret sauce in our implementation approach is bringing things back to basics, to deliver a minimum lovable product – because it doesn’t matter whether you’re a $10million-dollar company or a $500-million-dollar company – you’ve still got the same business processes. Learn more about Fusion5’s implementation methodology to get you up and running in no time.

In summary; make a solid plan – then stick to it.

Risk #4: Your users don't get sufficient training on new systems

ERPs often mean big changes in the day-to-day work for many of your people. If you don’t manage that transition with plenty of support for your users, it’s going to lead to breakdowns. First, your users are going to get frustrated, which will make them even more unmotivated to embrace the change. In addition to that, your project itself will suffer. Without proper training, you won’t be able to tell apart the natural growing pains of your team from the actual problems that might be present in your system. This is going to add time and cost to your project.

Solution:

Appreciate the importance of thorough training at a reasonable pace for as much of your team as possible before you fully transition to new systems. Answering questions ahead of time is going to save you hours down the line. Typically, you should aim to have 90% of your users fully trained before you officially make the change.

To help make your digital transformation a success, Fusion5 has a dedicated OCM (Organisational Change Management) team that understands people in your organisation have different learning styles and paces. We're here to help you avoid any unnecessary stress, ensure speedy adoption, and remove the need for people to seek out workarounds. Whether we take the reins with strategic guidance or work alongside your in-house change manager, we've got you covered.

Risk #5: Your data is more complex than you bargained for

It’s important to realise just how much effort your data migration will likely require. Huge volumes of data coming in from various sources can feel overwhelming and unmanageable to businesses that have never dealt with these kinds of complexities before.

Migrating data between legacy platforms to an ERP system can present consolidation and quality issues. In many cases, different branches of your business interact with the same customers, products, or information in different ways, which can lead to a whole heap of inconsistencies in data storage, documentation, and accessibility. (No wonder you need a new ERP and one source of truth!)

Solution:

Prioritise quality data. An ERP is your chance to start fresh, and as daunting as the task may seem, it pays off in the long run to ensure a full hygiene sweep through your company’s data. Cleaning up data may look like…

• • Cutting duplicates in your archives
  • Adding missing values before migration
  • Re-training your entire team about consistent storage practices

Be sure to factor in this phase of the project when you plan out your ERP project and lean on experts to help you tackle this with maximum efficiency. In the end, you should have a highly accurate, accessible, and unified data stack.

We know. And that's why we're here.

At the end of the day, what makes or breaks your digital transformation is how well you’ve planned and prepared. Your best chance of getting this right is to work with an ERP partner with extensive experience in this area. From figuring out how to scope such a complex project to understanding how all the different phases fit together, to helping ensure your team gets proper training – an ERP partner is there to ensure success every step of the way.

But it’s also important to choose your partner not just based on their capabilities, but also on how they fit with your culture and understand the nuances of your business operational needs.

No two implementations are the same. With every partnership, we always start by getting to know you, your goals, your team, and the specific things you’re addressing with your digital transformation.