December 19, 2011 5:15 AM

One of the bigger changes a company will experience during its lifetime is the adoption and implementation of a company wide Enterprise Resource Planning (ERP) system. An ERP system cuts across functional boundaries and departments, and touches every aspect of the operations creating more of a horizontal organizational structure, causing changes in work/business processes. These changes can also have a big impact on how stakeholder groups both inside and outside the business work with each other.

As a result, issues commonly surface that need to be planned for in advance of the configuration and implementation of an ERP System, which are critical in managing change to improve the likelihood of success .

In our experience, the critical areas that should be addressed and planned for, fall into 5 main categories:

• Communication.
• Politics. ( ie. inter-department conflict, power brokering)
• Resistance to change.
• Teamwork.
• Leadership.

If not planned for and dealt with proactively, these areas can provide significant barriers to effective implementation, which cause delays in project timelines and hinder the full utilization of the new software and its functionality and benefits. Also, it is vital for the company’s work and business processes to be accurately aligned with those of the ERP system if the full benefits are to be realized. Ideally, it is best if this process of alignment can be achieved prior to starting configuration, and definitely before implementation.

There are two major sources of resistance to innovation, such as an ERP system implementation faces when users are being asked to adopt change.

• Perceived risk refers to one’s perception of the risk(s) associated with the decision to adopt the innovation.
• Habit refers to current practices that one is routinely used to performing.

Resistance to adopt the new system may result due to some or all of the following changes :

New policies and procedures will be created.
New job skills must be learned.
Individual job roles may change.
New reporting structures may affect individuals and whole departments/functions

In order to improve the rate and speed of adoption, senior management and leaders need to deal directly and openly with employees’ concerns and their resistance to ERP implementation. Its also important that they anticipate these potential sources of resistance in advance, assessing who and what areas of the business are likely to be impacted the most by these changes. An effective set of strategies with an associated action plan will help mitigate the resistance to change , and foster adoption so that users can understand and clearly see the benefits the new system will bring to them, the business, and the customer.

Originally posted on Team Performance Solutions Blog

Blogger Profile: Russ Nachbar
Russ Nachbar is a Business Performance Specialist focused on profitability. With over twenty years of extensive experience in business and people development, Russ founded Team Performance Solutions to "offer businesses the access to tools and an easy to use proven system that enhances performance in business, ultimately making businesses more profitable."

Posted by Sue Ansell at December 19, 2011 5:15 AM

Categories: Enterprise Resource Planning (ERP) Project management

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