Why ERP Implementations are Fails and How to Overcome it:

by admin

Most of businesses, adopts ERP for not only to sorted-out present problems but also to take care future challenges. Generally, business owners take decision to purchase ERP for following reasons:

1. To adopt a set process in organisation

2. Management of inventory/production control

3. Security of financial data

4. Ease of access

5. Technology adoption

5. Future growth

Its mutual responsibility of end user and ERP company to success its implementation. Apart of strong documentation, both have their mindset to take it forward to the end. All things go very smooth when both the parties get sync, once its breaks, problem arises and projected get delayed and sometimes scraped. Both parties blame each other for failure of ERP project. This is not a good sign for both the parties. At one end where businesses lost their investment of time and capital, Service provider Company lost their credibility in market.

How to overcome it:

There are some points to take care by organizations:

1. Clear understanding about requirement and process

2. Understanding of limitations of proposed ERP.

3. Provide sufficient help and coordination with project team.

4. Adherence of timeline of project.

5. Acceptance of ERP among users.

6. Review of ERP Project at certain time interval.

Points for ERP Organisation/Service Provider

1.     Thorough Study of business process of client.

2.     Detailed documentation before start project.

3.     Adherence of timeline of project.

4.     Proper Coordination with different stack holders.

5.     Review of project at certain time interval.

If we consider above points, somehow we can increase possibility of successful implementation of ERP project.

What is the right time to adopt/purchase an ERP system.

Most of the companies take their start with small level and gradually – slowly pick up growth and become large organization. As a small organization, business owner handles most of the responsibilities on its own. As the organisation grown up and reach at certain level, complexity occurs and  it is very much  difficult to manage multiple things for business owner simultaneously. It is the time when organisation requires a well defined system to manage all verticals of business. In other scenario, this situation occurs from first day of inception in case of quite larger setup of organisation.

In a broad concept we can take following scenarios

1.      Based on number of employees: it is very difficult to put exact number of employees to manage by an individual and do corresponding task (ie on boarding, training, attendance, leave records, shift management in case of manufacturing unit, salary, payroll, Performance Appraisal, Record management up to exit formalities). On an average, an organisation having more than 50 employees need a well defined system to manage all above things.

2.      Based on number of Items/Product: Generally the perception is that, It is comparative easy to manage stock item for a trading organisation with manufacturing .But for trading organisation also, it is depend upon the number of SKUs, segment like auto parts or electronic part distributors/dealers having SKUs from 5000-50000 or even more than it, require ERP System. For manufacturing organisation where

Production planning to asses’ availability of raw material, machine and manpower. Costing is also important factor while planning. WIP exist and multiple work orders are process on shop floor/assembly line for make to stock or against Purchase order. Multiple machines are involved in production process, it has to be take care capability of machine, scheduling of service and alternate option in case of breakdown of particular machine.  Allocation of resources on the basis of work orders. Proper management of wastage, bi- product, scrap etc.

3.Based on locations: If business runs on multiple locations, require proper management of each location and MIS accordingly. Hope, this will help to mass of people who are planning to purchase ERP Software Application

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