Biggest Obstacle to any ERP Implementation: Data & People

Having overseen multiple IT-based projects, including large-scale ERP implementations, I’m often asked what are the biggest obstacles that I typically come across.  This also seems to be a favorite question during job interviews.  In my experience, there are two areas that you should be especially weary of:

  1. Data.  Big bad data…everyone’s favorite subject. This is further broken down into two subsets:
    • Data Migration.  This is the process of taking data from an existing ERP system and attempting to import this into the new software.  Who wants to key in a list of Customers or Vendors?  However, with schema’s getting more complicated to boost performance, importing data can be difficult.  Even if you have someone that is intimate with the new database, issues seem to crop up when you least expect it. In my experience, companies also seem to take this opportunity to redefine their Chart of Accounts. This means creating a cross reference table that translates the old accounts with the new ones. Again, another potential source of issues.  And then of course, you must properly document the data migration process that explains at least 3 points of validation.
    • Data Integration.  Everyone seems to want their new ERP system to be fully integrated with another popular software product.  Let’s use Salesforce as an example.  Naturally, Salesforce wants to integrate into as many ERP systems as possible, so the integration process must be somewhat generic.  Instead of reading the Customer Table from the ERP system, Salesforce has its own Customer Table and you’re forced to keep these two tables in sync with one another.  And that’s fine.  Until you have 2 other add-on products that also have their own Customer tables…then it starts to get out of control.        
  2. People.  This is the biggie.  In my opinion, people are the biggest obstacle to any project, far outweighing any issues with data discussed above. I would estimate that “People” account for 90% of all project issues.  The people element should always be part of your risk mitigation in your Project Charter.

Why people? Because humans are full of emotions and when emotions run high, they become unpredictable.  They become bolder in their resistance of the new software and often their co-workers are surprised by their actions.  Of course, they want the implementation process to have problems, because then they get to be vindicated.

In almost all my ERP implementations, I’ve noticed that the “average” employee is terrific to work with.  When shown the new software, they’re curious, they’re interested and they’re helpful.  Generally, the troublesome people are executives, super users or those part of the existing IT team.  There are three sources of their discomfort:

  1. Super Users – these people have an emotional attachment to the existing ERP system and can’t seem to make room for new software.  They want to protect their turf and are afraid they won’t be the “go to” person when people have issues with the new system.
  2. IT Department – they’re threatened by consultants coming in and helping with the implementation.  They’ll insist they can do everything the consultant is doing, without spending $100,000.
  3. Executives – these individuals haven’t bought into the new system.  They’re convinced that the existing system is working just fine and there’s no need to spend $2 million on new software. 

When faced with these issues, the process of a successful implementation is what I call blending people with technology.  In a future post, I’ll share some tips on how to deal with each of these groups.

One Reply to “Biggest Obstacle to any ERP Implementation: Data & People”

  1. This issue is particularly symptomatic of companies that are implementing ERP for the first time and transferring their legacy data into the new system from Excel spreadsheets, manual records, or old disparate applications. Basically, the issue is that old data that have been used and stored for years can for many reasons appear approximate or even incorrect in the new ERP reality. In fact, according to our research, replacing a legacy system and consolidating disparate solutions are the top two common challenges companies face.

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