Successful management of a business requires a well-designed system, that can help in running all the business operations smoothly. Not only for large businesses but a well-designed and properly integrated computerized system, is also the need of the hour for both medium and small businesses .
While the basic operations are just confined to recording sales & tracking stock positions in-store, there exist several challenges in implementing an information system, both for the businesses that are already using the system for years, or the companies that have implemented it fresh.
Failure in better assisting their daily operations, users may feel upset with the system and brand it as a “failed” one. However, there are several companies that are successfully using the same systems effectively.
Data sourced from the years 1994-2015 have revealed that the success rate of implementing a system for 20 years, lies in the range of only 20%-35%, which indicates that out of 3 to 5 implementation projects, only 1 is successful.
“Chaos Report” from The Standish Group has disclosed that only 9% of projects in large
companies were successful. At 16.2% and 28% respectively, medium and small companies were somewhat more successful.
A whopping 61.5% of all large company projects were challenged (Resolution
Type 2) compared to 46.7% for medium companies and 50.4% for small companies. Most projects, 37.1%, were impaired and subsequently cancelled (Resolution Type 3) in medium companies, compared to 29.5% in large companies and 21.6% in small companies
However, the modern improvements in technology have created awareness among the companies in creating Standard Operating Procedures (SOP), and advancements in user education, have made the new system implementation much better and simpler. This has increased the scope for success.
The Chaos Report have also classified that 50% of the companies face challenges like
- Over Expectation: The output failed to meet expectations
- Over Time: The Project failed to complete with in expected time-frame
- Over Budget: The budget has exceeded the allocated budget
While choosing an ERP system, some companies may go for an already available system in the market, and some other companies may choose to build their system specifically for meeting their requirements.
Building a custom build system however is not an easier task, the process consumes loads of resources like human resources, time, along with building and testing the systems before they are used. It also requires resources for fixing bugs that arise as the system is getting used.
A new ERP system implementation involves various stages, these stages are required for making the external/consultant team, along with the company’s in-house team, for a clearer view of their duties and responsibilities in the project. Here are the key stages in system implementation:
- Project Preparation.
- Business Process Blueprint.
- Go Live Preparation.
- Go Live and Support.
These stages in ERP system implementation can help in identifying the risks in the early stages of the project itself.
Along with these, there are several important points that can influence the system implementation process. The 8 important points among them are
- Support from Executive Management / Top Management
- Managing Expectations
- Business Process Blueprint
- Data Preparation Management
- User Readiness
- Go-Live Strategy – Parallel Run Vs Cut off
Depending upon the companies activities and interests,these points are supposed to exist in every stage of implementation
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