The extant literature suggests that a successful ERP implementation often requires identification and management of critical elements and their constituents at each phase of the implementation. Through a comprehensive review of literature 12 factors, listed in Table I, were found to be often cited as critical to ERP implementation success. Participating companies were asked to identify which of the 12 factors they considered to be key factors in their ERP implementation process. Table I shows that only four out of six companies indicated that from the beginning top management support for the project was clearly communicated and the support from top management played a critical role in their ERP implementation. Top management commitment is key to the success of an ERP implementation, and many managers may be involved but do not communicate their commitment to all employees and fail to realize the importance of their role as a leader and facilitator of change. Lack of user involvement, training and poor communication of the objectives of the project by managers are often mentioned as the major contributing factors for the ERP failure. Often, lack of employee involvement at all company levels as well as inadequate training and education causes many users to become frustrated with the system due to its complexity and significant learning curve. Frequently, employees at lower levels of the organization are not as involved as they should be and lack encouragement from top management to express their concerns or suggestions to address functional issues. This can have adverse effects on the system, as the end-user will either revert to the old way of doing things or create make-shift workarounds that circumvent the ERP system altogether. Thus it is not surprising to see that having clear goals and objectives, user training and education as well as user involvement in evaluation and implementation were commonly considered by five of the case companies as key success factors; again, the only dissenter was Company B which was the only company not to have formal strategies for acquisition and implementation. ERP systems generally come with standard applications and are modular in nature. However, some companies may require customized version of ERP systems than others. Customization increases the cost of an ERP package. The more advanced and complicated the company and the system, the greater the cost. To avoid costly customization, companies may choose to minimize the degree of customization or to completely reengineer their processes to fit the ERP system. Business process reengineering and minimizing the amount of customization were considered critical by only half of the participants. ERP systems are based on a value chain view of the business where functional departments coordinate their work, focus on value-adding activities and eliminate redundancy. For this reason, interdepartmental communication becomes critical in creating a value chain throughout the company when implementing an ERP system. Organizational culture can facilitate or inhibit the integration of ERP systems. Managing change and corporate culture during the implementation phase can be most critical to the ERP implementation success. Interdepartmental communication was considered by five of the six respondents as key, whereas half of the case companies specified change management and organizational culture as critical to their ERP implementation.
September 18, 2019 0 Comments