Challenges involved in the implementation of ERP

 Top 10 challenges in ERP implementation

1. Inadequate Requirements Definitions

The inadequate requirements definition or rather the absence of such document pose the greatest challenge to ERP implementation. The requirement definitions document carries the blueprint for the implementation process. It helps the team to select the right ERP solution.

2. Resistance to Change

Without an ERP system, the workforce will be used to managing the various functions of the organization manually. Then if a decision to implement the ERP comes from the management, then the employees tend to resist the change. So, if employees are not convinced about the importance of ERP and advantages of using an ERP tool and system they will not be supportive. There are lot of misconception regarding ERP with the employees. Management must educate users about the benefits of ERP. Also, they must create champions, who are well respected potential user of the technology. The champion then becomes model user of the ERP creating an example and he helps other users.

3. Incapability to understand Organizational Architecture

Not many of the employees understand the structure of legacy system, so it becomes difficult to implement a new system to overcome the deficiency of the old system.

4. Scarcity of Resources

ERP implementation involves lot of cost implications as it requires a variety of resources –money, people and software, hardware and so on. Lot of items may be missed during the preparation of the budget but will consume money during the implementation. The usually long implementation period (usually 8-20 months) will escalate many costs. Another resource that is generally, in short supply is the right personnel.

5. Top management Support: 

The top management’s role in IT implementation is crucial as it will reflect in the attitude of the employees. Their role includes developing an understanding of the capabilities and limitation of IT, establishing reasonable goals for IT systems, exhibiting strong commitment to the successful introduction of IT and communicating the IT strategy to all employees.

6. Lack of organizational readiness 

The entire company must be ready to implement the new system. Without the employees ready to adopt an new system, the entire ERP implementation may get into jeopardy.

7. Insufficient Training and Education

ERP projects have a minimum of six-month learning curve at the beginning of the project. Every user must be given proper training and make them realize about the benefits of the ERP systems.

8. Unrealistic Expectations are the norms 

Because of it most ERP implementations today result in cost and schedule overruns. As per a study ERP implementation succeed with full functionality, within forecast time and cost frames and 55% are implemented with cost and time overruns and remaining 35% are cancelled. Cost overruns average 178%, while schedule overruns average 230%. On an average the ERP are implemented with only 41% functionality.

9. Poor selection of ERP

The choice of the ERP involves important decisions regarding many criteria like cost involved, time frame, objectives and output of the vendor.

10. Bad Project Management 

A project scope that is ambiguous can cause severe problems. Customization results in increased project scope which in turn leads to cost over runs.

With all this in consideration, we have crafted you an industry specific ERP solution that matches your exact requirement. When you get the right software like Horizon EBS Solution, changing the existing processes isn’t as time-consuming or complicated as it looks. The total ownership cost of modern solutions is also affordable as the return on investment is great – Complete Automation. If you need to know more about Horizon EBS, you can write to us at sales@fit.ae or ring us at +971 4 353 3727