ERP-enabled business transformations are often unbalanced from the very beginning, a big reason why so many fail!
For the Executive Sponsor, the decision to implement a new ERP system or to commit to a major upgrade is like playing career Russian roulette with 5 of the 6 chambers loaded! One of the most common root causes of ERP Transformation failure is an imbalance in knowledge, competencies and capabilities.
All too often the knowledge, competencies and capabilities exist principally on the side of the chosen System Integrator and not where they are critically needed, that is within the business. This imbalance has enabled Systems Integrators, Outsourced Service Providers and Contractors to gain massively from programmes that overrun and eventually fail.
I accept that in most businesses the required expertise is not just waiting on the bench for your programme to come along. In truth business-side teams are usually overstretched and introducing a complex transformation on top of other strategic initiatives often translates into an impossible ask.
The solution is not as difficult as you imagine, in fact it’s quite simple: you address the imbalance and create success when, first, you initiate and go on to mobilize your business-side team and determine which responsibilities are on the side of the Business and which are on the side of the System Integrator.
Put simply, you need to stack the cards in favour of the business.
This means that the business-side team leads in Programme Management, Process Design, Data Migration, Middleware Integration, Change Management, User Acceptance Testing, and Training.
The System Integrator supports Functional Design, Solution Architecture, Build, Component and Integration Testing.
But even if the structure is sound, how do you counteract the imbalance that exists because the Systems Integrator has so much specialized knowledge?
My experience is instructive here. It draws on 25 years of ERP-enabled transformation experience and is not something that can be duplicated by following a few straightforward tips. Instead you will have to do the hard work yourself. So when I tell you my approach, we are looking at the long game – these are tools acquired over a decade.
Unconsciously over the years I had been supplementing my teams with external knowledge that supported the structures in each of my ERP-enabled transformations. I had looked beyond the boundaries of the business. As the great Jack Welch said about GE, “Boundaryless thinking meant we were open to the best ideas and practices from anywhere – another colleague, another department, another country or even another company. It changed our thinking and broadened our awareness. Boundaryless behaviour increased the organization’s intellect and, thus, its effectiveness.”
By looking beyond boundaries my method overcomes the imbalance between client and contractor and enables the business team to be supplemented by experienced hands. The external team integrates into the business team and acts in unison with them. The new, deeper business-side team has the required knowledge, competencies and capabilities to manage both the transformation and, importantly, the System Integrator.
At the operations level, this boundaryless approach enables me to:
- Establish an Enterprise Design Authority with the delegated authorities from the ELT and Executive Steering Committee to develop the transformation roadmap, facilitate the development of the end-to-end design, support functional and technical execution and act as the primary change body.
- Create a transformation plan that places the business in the driver’s seat by elevating the business-side knowledge, competencies and capabilities to a position where they can develop a partnership of equals with the System Integrator.
- Identify the gaps in knowledge and the missing competencies and capabilities required to enable the business side of my programme. Traditionally the contract market has been the principal source for these skills, but using contractors is not without risk. Experience has shown that it is not unusual to have a high level of attrition due to the wide variability in the quality of contractors.
In essence this method creates “middleware” that enables the business and the Integrator to deliver ERP-enabled transformation. Over the past decade I have built an extensive network of transformation, programme management, change specialists down through the various technical specialisms. This network has been engaged on numerous programmes and has an impressive track record of success.
In our next instalment, I’ll look at this approach in greater detail …
Executive Interim – Chief Transformation Officer & Chief Information Officer
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