In many cases those pushing for a new ERP system are comparing the worst of the current environment to an idealistic ERP concept that is all things to all people.
Sometimes the best way to avoid a train wreck is not to get on the train. In other words, do you really need a new ERP system and, if so, is now the right time to proceed? Performing an honest and thorough assessment of business needs and alternatives is an important part of taking ownership in the ERP business case, the decision not to do ERP or any alternative solutions.
It is understandable this question is not always popular among the ERP zealots; but for the organization, it is a very necessary discussion. There is an old saying that certainly applies: “when you have a hammer in your hand everything can look like a nail”. That is, believe it or not every organization does not need a new ERP system.
The problem is when the ERP bandwagon starts to roll and no one in management is asking the right questions, those with legitimate business concerns get steam rolled. It is often not even a fair debate. After all, in many cases those pushing for a new system tend to compare the very worst of the current environment to an idealistic ERP concept that at this stage is all things to all people. Make no mistake; there are plenty of good reasons to implement ERP including many “no brainers”. However, in most organizations the decision is not so obvious and one must objectively evaluate the validity of the proposed business case, timing and not shoot the messengers that raise the red flag.
Therefore, an executive running a business in the real world must ask the following questions before spending millions of dollars on ERP. Again, the intention is not necessarily to rain on your ERP parade; but perhaps bring some sanity to the decision-making process.
1. Are the business strategies and assumptions that drive the perceived need for a new ERP system valid?
2. Would an ERP project be one of the top two priorities within the organization (given other internal and external projects, initiatives, or probable events)?
3. What is really broken, the current software or our business processes? (Don’t attempt to automated the mess you already have!)
4. Has the organization attempted to fix the things it can without new software? (The point is bad policies, procedures, work flows, controls, cultural issues and measurement systems typically have little or nothing to do with software, but a lot to do with poor business performance).
5. Will the availability of “better information” actually result in better decision-making or make lousy managers more effective?
6. Does anyone understand the data or capabilities of the current software (that are not utilized)?
7. Is the promise of “new technology” always a good reason to throw out application software?
8. Do we have bad software or just bad data (garbage in, garbage out)?
9. Is everything about the current software terrible (or are there areas where a major step backward is inevitable with new software)?
10. Can a few customizations or enhancements to the current software satisfy 80% of the important needs for a fraction of the time and cost? (I know mods are a no no but sometimes they make perfect business sense).
11. Can a few purchased (and integrated) “bolt-on” applications do the trick vs. buying an entirely new package (that likely has a few bolt-ons of its own under the covers)?
12. Is the current software really on the brink of “not supported” by any vendor(after all, they have been saying this for years) and, if so, what are the other support options?
13. Before spending a fortune on software to implement a new operating philosophy or paradigm, should we first “prove out” the idea with a limited pilot? (even when a few software work-arounds are necessary to complete the pilot).
14. Are the perceived operational benefits and cost savings of new software real or fluff? (The history of ERP states they might be fluff)
15. Have we considered ALL the implementation and support cost in the ROI? (Many are not so obvious).
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