ERP is a journey NOT a destination

In a rapidly changing business environment, ERP (Enterprise Resource Planning) puts the systems in place and allows you to accordingly react to these quicksilver changes. It has an all-encompassing scope in industry whether it is in financial, production, outsourcing, logistics, etc. As a concept, it has become a buzzword and has picked momentum for the last few yeas. But every successful concept has its initial teething problems and ERP is no exception to this fact. A recently held seminar at NITIE dwelt on the issues that affect ERP implementation and the strategies to overcome these drawbacks.

The issue that all unanimously felt topped the list was the lack of top management commitment. Ever decision taken requires total top management involvement without which ERP implementation efforts come to naught. But top management will be totally involved in ERP only when it feels that the company will be ultimate beneficiary. Says Satish Pendse, GM, Information Systems, Marico, "The strategy lies in not asking for organizational commitment, but in aligning organizational strategies with IT strategies and ERP."

Each and every issue that concerns ERP is inevitably linked with people and their expectations. While speaking about expectation management, which is another vital element in ERP implementation, Girish Gala, Advisory Project Manager, IBM, says, "People expect ERP to deliver everything under the Sun. They feel that if you press a button you will get anything. They ought to realise that a company's turnover will not double automatically."

This issue of people's fear of ERP - that is may effect them adversely, is addressed under Change Management People consider ERP to be a threat as they feel that their traditional function of doling out information will now become redundant in view of the fact that machines will perform this function and thy will no longer be called upon. This fear of redundancy or loss of power needs to be addressed and they need to be assured that people do not lose jobs due to ERP. People may also not adapt to the new system due to the failure of proper training. The fear of failure too can bring about resistance since every error in this system is blown out of proportion. With regards to resistance to ERP, Prashant Karkhanis, Head, Business Consulting, Mahindra Consulting Ltd., says, "When companies switch to ERP, the performance measurement bar goes up. But for every action there is an equal and opposite reaction. Similarly there is resistance to the new technology and to the inherent changes." To combat these negative ERP after-effects, proactive measures in terms of incentives are required to link the benefits of the company to that of the individual. VS Harish, Dy. GM. SISL suggest that career planning should address the vital question, 'What's in it for me?' He says. "To increase involvement, a thorough knowledge of the benefits accruing to people is essential. If they feel their interests are taken care of, they will willingly accept. Also one the system has been implemented, people should be assured that they will not be jobless." A classic method of generating pull rather than push (to increase involvement in ERP) is based on the concept of a power user i.e., the use of an IT-savvy person who is respected and who needs to be trained. On learning that he will be responsible for training others, he (the power user) will willingly undergo rigorous practice in order to be proficient in that field and to train other efficiently. This also gives the person intellectual satisfaction and he goes on to influence others. This is a softer way to manage change."

The lack of planning too can undermine implementation and regarding the selection of the right team, Pradeep Erinjery Director, Thirdware Solution Limited, goes to say, "A good project manager is essential. He need not necessarily be a bright Techie but he should know to manage people and the changes involved in the implementation process." Before the actual implementation, a lot of groundwork is required and this evaluation reduces implementation time. V S Harish says, "Vendor selection and selection of a proper package are vital. Evaluation regarding the ERP vendor should be based on the fact that he should be financially sound to ensure its survival and the organization and vendor should have synergies and have a common roadmap or vision. In the case of the ERP package, in many cases after implementing it half way through companies realise that the package is not suitable and then abandons it. This is a costly exercise." The main thrust now and in the future lies in creating industry-specific ERP. Many companies apart from manufacturing units are getting into publications. We also now speak in terms of ERP II with additional functionalities, additional modules and additional products like Data Warehousing, Supply Chain Management and Customer Relationship Management. To sum up, Satish Pendse succinctly put it as "ERP" is a journey not a destination."