In many cases, those pushing for a new ERP system are comparing the worst of the current environment to an idealistic ERP concept.
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.
These questions are not popular to ERP enthusiasts. For the organization, however, they are vital. An old saying comes to mind: “When you have a hammer in your hand everything can look like a nail.” In other words, while ERP is a quality, flexible system, not every organization needs a new ERP system.
Unfortunately, when the ERP bandwagon starts to roll and no one in management is asking the right questions, those with legitimate business concerns get steamrolled. In many cases, those pushing for a new system compare the very worst of the current environment to an idealistic ERP concept. 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, so one must objectively evaluate the validity of the proposed business case and timing. In addition, the team must not shoot the messengers who 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:
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 the business processes? (Don’t attempt to automate the mess you already have!)
4. Has the organization attempted to fix its issues 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 will it make lousy managers more effective?
6. Does anyone understand the data or capabilities of the current software?
7. Is the promise of new technology a good reason to throw out current application software?
8. Do we have bad software or just bad data?
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 about 80% of the important needs for a fraction of the time and cost? (I know mods are discouraged, but sometimes they make perfect business sense).
11. Can a few purchased (and integrated) bolt-on applications do the trick as opposed to 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 may 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 if 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 shows they might be fluff.)
15. Have we considered all the implementation and support cost in the ROI? (Many are not so obvious.)
I can not imagine finding this information right on time, thank you.