Anyone who’s ever gone through a cloud ERP implementation or upgrade using SAP, Oracle or other ERPs knows it’s no walk in the park. There are a million and one things that could (and usually do) go wrong. There are plenty of challenges that can trip up even the most experienced ERP team.
In this post, we’ll take a closer look at the top challenges of cloud ERP implementations and how you can overcome them. So let’s get started!
Lack of buy-in from upper management: One of the most common problems facing ERP teams is a lack of buy-in from senior management. Without the support of those at the top, it’s difficult to secure the resources and budget needed to successfully implement an ERP system. It’s also harder to gain alignment on objectives and ensure everyone is working towards the same goal. To overcome this challenge, it’s important to build a business case for your cloud ERP migration or implementation project that demonstrates how it will benefit the company. You should also keep upper management updated on your progress throughout the implementation process.
Inflexible software: Another common issue faced by ERP teams is inflexible software. An inflexible system does not allow for much customization, which can be a problem if your business has specific needs that need to be met. This is usually true with large enterprises where business processes are highly customized and difficult to change. To overcome this challenge, if you are implementing the ERP for the first time, you must carefully vet different ERP vendors to find one that offers a flexible platform that can be customized to meet your unique needs. If you are only migrating your ERP to cloud, your choices are limited. You should also look for a vendor that offers support and training so you can ensure your team is properly equipped to use the system.
Complex data migration: Data migration is one of the most complex and challenging aspects of any ERP implementation. This is because you need to migrate large amounts of data from your old system to your new one while ensuring that all of your data is migrated accurately. To overcome this challenge, you need to have a solid plan in place for how you’re going to migrate your data. You should also consider using a data migration tool to automate some of the processes and make it easier for your team. For upgrades, it is fairly straightforward upgrade path that different ERP systems offer you e.g. Oracle’s Lift and Shift.
Long implementation timelines: Another common challenge faced by ERP teams is long implementation timelines. An ERP system can take several months or even years to implement, which can be disruptive for businesses and lead to lost productivity. To mitigate this risk, you need to carefully plan your implementation or migration timeline and make sure you have adequate resources in place so you don’t run into any delays. You should also consider doing a phased rollout to start using the system sooner rather than later.
Limited internal resources: Many businesses lack the internal resources to successfully implement an ERP system. This includes technical expertise, project management skills, and change management experience. To overcome this challenge, you need to supplement your internal team with external consultants who have experience implementing ERP systems. These consultants can provide valuable guidance and expertise so you can avoid making common mistakes during your implementation.
Scope creep: Scope creep is the bane of every project manager’s existence. It’s that pesky tendency for the scope to gradually expand beyond its original parameters. And ERP implementations are especially susceptible to scope creep because they often touch many different parts of the business.
The best way to combat scope creep is to establish clear boundaries and limits early on in the project. Work with your team to create a detailed project plan that includes all the deliverables, milestones, and deadlines. And most importantly, make sure everyone is on board with the plan before you start executing it.
Budget overruns: Budget overruns are another common challenge with ERP implementations. It’s not uncommon for projects to go over budget by 20%, 30%, or even 50%. The best way to avoid this is by being realistic about your budget from the start. Make sure you include every possible expense in your budget, from hardware and software costs to the training and consulting fees.
It’s also important to have a contingency fund in place in case something unexpected comes up during the process. By preparing for the worst, you can avoid going over budget and blowing up your entire implementation timeline.
Unrealistic expectations: One of the biggest challenges facing ERP implementations is unrealistic expectations. When senior management doesn’t understand what an ERP system can (and can’t) do, they often set unreasonable expectations for the team charged with implementing it. As a result, the implementation team is constantly scrambling to meet impossible deadlines and deliverables, leading to frustration and burnout.
The best way to combat this is by getting everyone on the same page from the start. Make sure senior management understands what an ERP system is capable of, and what it isn’t. Set realistic expectations for what can be accomplished during the implementation process, and make sure everyone involved agrees on those expectations before moving forward.
Another common challenge facing ERP implementations is inadequate resources. Many organizations try to implement or migrate to a cloud ERP system on a shoestring budget, which often leads to problems. When you don’t have enough money or manpower dedicated to implementation, it’s often impossible to execute it properly. This can lead to subpar results, wasted time and money, and frustrated employees forced to work with a flawed system.
To avoid this challenge, make sure you have enough resources dedicated to your implementation from the start. This means having enough money in the budget to cover all expenses, as well as enough people on your team with the necessary skillsets. By adequately staffing your implementation from Day One, you can avoid many of the problems that arise from having too few resources later on down the line.
Cloud ERP implementations are no walk in the park – many potential challenges can trip up even the most experienced teams. However, by being aware of these challenges and taking steps to overcome them, you can set your implementation up for success. Lack of buy-in from upper management, Inflexible software, Complex data migration, Long implementation timelines, Limited internal resources, Scope creep, budget overruns, unrealistic expectations, and inadequate resources are some challenges you may face during an ERP implementation. But if you take steps to prepare for them, you can successfully navigate these challenges and come out on top.