With complex system implementation creating room for additional error, failed implementations are all too common. Troubled implementations commonly run way over budget, behind schedule, and/or fail to deliver expected business benefits. If you have experience-or are currently experiencing-a failed implementation, you know how devastating it can be for an organization. The aftermath of this type of project failure has the ability to disrupt and demoralize individuals at every level.
A successful ERP recovery plan will restore business confidence and re-align the project with business priorities.
How to Fix a Failed ERP Implementation
If you’re struggling with a failed or failing implementation, don’t lose hope! Many organizations have turned to MCDA CCG, Inc., to guide their project recovery efforts. These turnarounds are often heavily based on strategic analysis of past failures and weaknesses, and the development of a comprehensive recovery plan. Below we’ll outline four steps you can take to get your organization back on track.
1. Identify the Breakdown
Your first step to fixing an unsuccessful ERP implementation is to assess why it has failed. ERP projects fail for countless reasons but, generally speaking, they can be divided into six problem areas with various subcategories.
• Business Case
• Strategic Need
• Business Benefits
• Business Processes and Requirements
• Business Priorities
• Business Requirements
• Process Ownership
• Technology and Architecture
• Solution’s Standard Functionality
• System Integrations
• Project Management
• Timely Decision Making
• Data migration
• Resource Management
• Internal Resources (ie. Project Team)
• External Resources (ie. Consultant, Implementation team, Partner)
• Change Enablement
• Stakeholder Support
• Business Impact
• End-user buy-in
• Business Process Re-engineering
If any of these specified areas experienced performance issues during the unsuccessful project, they must be further examined. Choosing the wrong system or vendor, anointing the wrong implementation team (either internal or external), a breakdown in project management, and/or a lack of business process improvement/change management within the organization itself are some of the most common issues that can sabotage an implementation process. By uncovering the root cause(s) of the failed implementation you will be able to recommend solutions and move forward with a recovery plan.
2. Assess the Short-term and Long-term Effects
Next, the short-term and long-term effects on the organization must be assessed. After a frustrating implementation project has failed to deliver promised results, it’s not uncommon to make emotional decisions. By developing a complete analysis, your decision on how best to move forward will be backed by quantifiable metrics.
Assess each area, department, and business process that the system affects; identify any bottle-necks or operational pain points. You’ll need to identify what isn’t working on a department by department and function by function basis. From there, determine if these issues are short-term “growing pains” or long-term issues-and prioritize accordingly.
3. Fight or Flight
As in any crisis, you’re faced with two options: Fight or Flight. In other words, once your ERP implementation fails you will need to decide whether to salvage or scratch the new system altogether. There are pros and cons to each. While sometimes it’s best to start over, other times it’s better to fix what’s already been done. Steps 1 & 2 will help inform which option will yield the best results for your organization.
By using your responses to step 2, divide the issues with the current system into two categories. One category is the “low hanging fruit”-quick and dirty fixes that will alleviate disruption and improve efficiency with minimal effort. The other category contains more complex fixes with higher costs that take longer to implement. Prioritize your problem/solution combinations to arrive at the top 5-10 areas where you will experience the most immediate business improvements at the lowest cost. Many of these fixes will not involve ERP functionality, but will instead focus on business processes and organizational change management. Implement these 5-10 solutions first; once you have a few quick wins in place, use that organizational momentum to prioritize and implement more long-term solutions as time and resources allow.
At times, ERP implementation projects have failed so spectacularly that it simply cannot, or should not, be salvaged. Often, these went off the rails early in the project even though problems may not have become obvious until after the system goes live. Of course, a new implementation will involve re-investing time and further resources. However, this investment can be the lesser of two evils if the issues in the current system are excessive or too complex.
If choosing to undergo a fresh implementation, ensure that you follow best practices in order to avoid common pitfalls.
4. Learn from the Failed Project
Your recovery project will yield the same negative results as the original failed implementation unless you learn from your mistakes and make corrections. Whether you choose to salvage the current system by making these changes or decide to start from scratch with a new implementation, you’ll need to do things differently. Revisit the list of mistakes from step 1 regularly throughout the recovery process.
It can be a long and arduous road to recover from a failed ERP implementation, but it is necessary in order to get your organization back on track. You’ll need to take an honest look at what made your initial project fail, including your implementation team, project management, and choices in vendor and installation team. Don’t be afraid to make internal business process changes in order to leverage the system’s functionality. But above all, ensure that you’re learning from past mistakes to avoid repeating them.
As you contemplate the methods regarding getting your business back on track, consider connecting with genuine individuals for their expertise and guidance throughout this complicated process. Our team here at MCDA CCG, INC. have helped numerous businesses persevere through previous losses by guiding them throughout their recovery path to actively achieve desired results. We can help you too. Contact us today for a consultation with one of our experts.