AllenWeb
AllenWeb
Jun
98
ERP Project Management - Part 1 |
ERP Project Management - Part 2 |
| Management and Implementation -
The Importance of a Positive Corporate Culture |
The Vendor Relationship - Balancing Benefits with Risk |
| Corporate Culture - the Seeds of Failure
- The Right Attitude Can Make or Break a Project |
Risk Goes With the Project - Prepare to face the Danger |
| Committing Management -
Gradually Encourage Corporate Ownership |
Implementation Will Hurt - But Preparation Will Help Ease the Pain |
| Ownership Starts on Day One
- Finding and Keeping Project Enthusiasm |
Are You Ready for a New System? - Determine Company Intentions and Commitment |
| Increase Success by Avoiding Failure -
12 Steps to Risk Reduction |
How Important is Cost? - Be True to the Budget |
Angels in the Executive Suite -
Working |
The Importance of Technology - Preparing for Your Company's Future Needs |
| It's Your Project and Your Project Manager - Owning Implementation Keeps Credit and Blame In-House | The Necessity of Functionality - What Do You Want Your System to Do? |
| Project Justification - Honesty is the Best Policy | The Right Time for Reengineering - The Truth Behind a Growing Concept |
| Using Consultants - When and Why Managers Seek Help From the Outside | Implementing What You Need - A Quick List for Corporate Success |
| Who Are the Decision Makers? -
Seeking a Supportive Steering Committee |
Overcoming Resistance to Change and Managing Expectations - The Key |
Management
and ImplementationNo project is executed in a vacuum. Projects are realized within the confines - both physical and psychological - of a given company. Perhaps today's most complex project is implementing an enterprise resources planning (ERP) system. By its very nature, the unfolding of such a large project is influenced by the company environment, and it is that environment that can breed success or failure. Oftentimes, corporate culture is an extension of its management, but even with the most optimistic manager, it is unlikely that an entire company will change its attitude just to increase an ERP project's chances of success. Management must recognize th subtleties inherent in the company culture and develop an implementation plan that works around, or avoids,. pitfalls.
Although corporate cultures are very complex, there are some key indicators that can greatly impact your ERP project:
There are few companies that can answer yes to all of these questions, but knowing how your company deals with each is important to your project's success.
Most companies are not fertile fields eagerly awaiting your ERP plow,
but instead are potential minefields ready to blow up the unsuspecting.
This coverage will go to some lengths to make you more cognizant of
how to identify, avoid, and/or defuse these bombs.
Corporate
Culture - the Seeds of Failure
Before you turn your implementation dream into a reality, you first
must set boundaries that will define the corporate culture. No project
can succeed without a shared spirit of cooperation. However, even
though most companies are unwilling to admit it, there is often much in the
corporate ethos and culture that negatively impacts the likelihood of success.
there are many defining characteristics to every corporate culture.
Making the following decisions will help you ensure success for the
implementation:
IF you can make all of this happen, your corporate culture will help you attain success.
You probably cannot respond positively to all of these statements, but your project still must be played out within the corporate culture, whether you like it or not. You probably will have no real opportunity to change it, so you must learn to first recognize it, then evaluate its impact, and finally work around it.
No project can succeed without a shared spirit
of cooperation.
Committing Management
Corporate culture is a key facet of company management, and the most effective way to work within the corporate culture is to get management to believe in the project. They must commit to the project so that its success or failure also is their success or failure. By doing this, even the corporate culture may bend to your will.
The best projects slowly draw management into deeper commitment. In
this way, managers have time to adjust to escalating responsibilities instead
of falling into them all at once. Such escalating steps may be:
Ownership
Starts on Day One One of the greatest challenges of major system implementation projects is sustaining the enthusiasm and commitment throughout the course of the entire project. Involvement engenders ownership, and employee involvement secured early and maintained consistently can spell the difference between success and failure. This involvement starts with requirements definition (the SCOPE) and software selection. The more people feel they have had a say in setting priorities and selecting a system, the more they will feel compelled to stay involved, even during rough times. If the software selection is perceived to have been done by a chosen few, the masses can feel justified in remaining aloof. Full-scale mutiny is unlikely, but if most of the crew feels they are just along for the ride, the odds of weathering the inevitable storm are greatly reduced.
While ownership can be secured with involvement, it cannot be sustained without constant forward movement. Long lapses between action steps are certain to lessen workers' focus and dedication. From the moment of the project kickoff, time becomes the project's worst enemy While care must be taken not to rush into premature decisions, getting bogged down in weeks or even months of analysis work will sap the energy of those waiting to get to work. The longer you spend analysing the problem, the fewer people you'll have ready to roll up their sleeves to solve it.
The process of defining system requirements and narrowing down the list of acceptable software vendors is most often the biggest culprit in the time versus enthusiasm scenario. IF it takes months for the selection team to emerge from the conference room with its list of software packages for people to start viewing, they will have a tough time recapturing that enthusiasms that has dissipated in the interim.
Encouraging Ownership
No matter how anxious you may be to make your project a success, not everyone
will jump at the chance to participate. Sometimes incentives need to
be offered to elicit a higher degree of ownership. For so-called bad
apples - those who refuse to go along, becoming a detriment to the project
- the incentive of keeping their jobs may be enough. Let them know
they must be either part of the team or not involved at all - the only
alternative is removal. Big-ticket projects are tough enough without
naysayers. Another more accepted practice that encourages a willing
team spirit is awarding financial incentives. If all responsible managers'
end-of-year bonuses are dependent on specific project and financial goals,
their buy-in, especially as the implementation approaches, becomes even more
committed. The company must recognize that some project goals must
be rewarded when met, regardless of whatever overall profit and sales goals
for the the business are.
Successful projects comes only from management with a strong sense of responsibiilty.
Increase Success by Avoiding Failure
It's human nature to begin a project with dreams of success. With an implementation, project teams plan that each step taken will be successful, each attained goal building on preceding successful steps. But this is only part of the total equation for a working system. Equally important is the plan to avoid failure.
Avoiding failure, that is, risk reduction, is separate from planning for success. In a world where only good things happen, you need only plan how to move forward. In real life, however, most of our large errors blindside us because we had our sights set on looking forward to success and weren't aware of potential downfalls. Any large project is as much an exercise in risk aversion as it is in task accomplishment.
Successful project managers anticipate what can go wrong. While they cannot identify every possible misstep, spotting just a few reduces the risk of complete failure. (Uncertainty management here is a must). Avoid potential risks by incorporating the following into the company culture.
Don't do
things for the wrong reason.
Identify the benefits that will result from
your project, then make sure every project-related action is directed toward
achieving those benefits. remember, benefits supersede company
politics.
Own the project.
All
managers own the project. They will be credited for its success, or
blamed for its failure.
Failure
is not an option.
No one should
believe that the project will be terminated. Doubt is not
tolerated.
Warn off
the disbelievers. IF successful
results are truly important to your company, naysayers must be silenced.
Remove those who won't support the project, or it that's not possible,
make their future success with the company dependent on the system's
success.
Cast
implementation details in concrete.
Set believable dates and
do not change them. Promote the implementation loudly and often, leaving
no room for anyone to believe that the company will tolerate missing the
deadline.
Keep the
project under control.
The longer and
larger a project, the greater the likelihood of failure. Nine months
is usually the extent of management's attention for any implementation
effort.
Designate
a single leader.
Shared leadership is divided
leadership.
Don't demonize
your vendor.
Never use your
software vendor as a scapegoat. You will need his goodwill as well
as his technical support for the long-range success.
Keep functional
managers accountable.
An ERP implementation
is not merely a "computer project," it is a strategic business project
and must be approached as such.
Make business
objectives the primary drivers of the project.
Investing in
technology for the sake of technology does little more than drain company
assets. Business objectives must be the primary drivers.
Don't let
technology jargon intimidate system users.
When system users do not understand
what is being explained about the system, they will lose their enthusiasm
for making the system work.
Do not
over-modify. Perfectionists try
to customize the system down to the smallest detail, they will only succeed
in building a fragile house of cards that is certain to crumble at the
inopportune time.
To keep the project in-hand, periodically reassess where it stands, especially in regards, to potential problems. Also verify that the project team's attention is focused on the right goals. Remember the two important and mutually dependent goals: success and not failing.
All managers own the project. They will be
credited for its success, or blamed for its failure.
Angels
in the Executive Suite
Every project needs a guardian angel, an overseer who can make things happen.
The angel who champions the project must come from the upper reaches
of the organization for the following reasons:
It's best when this angel is the "top guy" in the organization, but for many companies the angel is a mid-level vice president. The angel's job is easier when the project is contributing directly to the overall success of the company - when corporate goals cannot be adequately met without the new systems (e.g., sales volumes exceed current system capability or the Year 2000 problem will cause bookkeeping chaos).
But many projects have far less immediate underpinning. These are systems that are being implemented to increase control, replace obsolete functions, establish more flexible systems, embrace a new technology, or replace a recalcitrant vendor. It's not easy to develop a sense of urgency for this type project, so urgency is usually generated by management. Projects like this should be as short as possible so as not to lose what is probably minimal support at best. Market conditions, management changes, and unexpected bumps in the project road all can have a disastrous effect.
Given this environment, the angel's motivations should be parochial. With a bonus performance dependent on implementation success, the angel should be responsible for departments that expect the most from the new/improved functionalities. When possible, the angel's focus should be financial. Financially justified projects demand management support, and when things get tough, the pressure to complete such projects usually goes up rather than down. Projects with questionable bottom line impact are th first ones to be jettisoned.
It's Your
Project and Your Project Manager There is no concept more important to implementation success than project ownership. And if you fail, it's your fault. If you can even imagine a scenario where an outside firm could be the fall guy, you might as well forget the project - the necessities of implementation leave no room for a scapegoat.
Outsiders may be brought on to help, but they aren't responsible for your
project's success. Some negative consequences of outsourcing project
management include:
Even the best consultants consider your company's needs as third in line, right after themselves and their firm.
Now that you've decided to keep project management in-house, the choice of a project manager is next. The project manager must be committed (the project strongly impacts his area of responsibility), respected (he has experience and capability that others in the company trust), and powerful (he will make things happen, sometimes even with intimidation if necessary).
The background of the project manager is crucial - after all, there is a difference between operations staff - the "how" people - and systems staff - the "why" people. It's best to have a background spanning both, but if that's not possible, someone from the operations side of the business is preferable - the "why" can be accommodated by the steering committee, but "how" knowledge must be on the front line.
The project manager's demeanor is equally important. The attitude spectrum runs from taskmaster to crowd-pleaser - the ideal candidate being somewhere in the middle. While the project should not resemble a forced march, a successful project manager understands that the job isn't a popularity contest. Salesmanship is a trait often overlooked when selecting this position, yet it is one of the most powerful tools a project manager can carry.
A Different Type Project
Even the best user-sourced project managers have to start from
scratch - project implementation is different than most managerial projects.
While an effective manager may be able to organize a department to
do the same routines on a day-in, day-out basis, implementation requires
identifying and implementing thousands of steps that each occur only once.
The project manager will need training and guidance for this kind of
project, or will need to look to an experienced project administrator to
help.
Even a strong project manager cannot succeed when others believe the project can be stopped or delayed. Everyone involved must believe from the beginning that an on-time implementation is the only acceptable solution,. The project manager also must have the authority to get things done without having to ask permission each step of the way.
The best project managers use the buy-n, fearlessly command the support, and ruthlessly pursue the end date. But remember, if the end date is conservatively developed in the first place, ruthless may mean no more than light - but steady - pressure.
A successful project manager understands that the
job isn't a popularity contest.
Project
Justification
The justified project has received its stamp of approval, and top-level support is guaranteed. If the system's advocates can't rally support for the project, they are better off forgetting the more difficult task of implementation. Proper management attention is gained only through realistic assessment of what is required. System advocates must receive support after identifying bot benefits and risks facing the company.
The best justifications match project goals to company business objectives. For example, if the business's goal is to grow through acquisition, then concentrate on how the new system can be sued to squeeze inventory and receivables assets to finance the acquisitions internally. Identify the company's goals and focus the system's benefits on those.
Not only do project deliverables need to support overall business objectives, but the cost/benefit analysis also must be constructed with numbers that have credibility. If the numbers cannot pass muster, your troops will view the project as a scam, or even worse, as a persona agenda.
Employees must believe the project is worthwhile, or they will not be willing to put forth the effort required to succeed.
On a cautionary note, projects justified by projected downsizing start out with a negative atmosphere that almost guarantees a low level of ownership and participation. When employees see that success is defined by the loss of jobs - either their own or those of their friends - the odds of anyone rolling up his sleeves to dig into the project is virtually nil. While downsizing may be one of the easiest benefits to visualize and quantify, it is the most dangerous to use. Get creative and dig deeper to find other options.
Even projects without financial justification need to be costed realistically. Since cost overruns are likely to reduce management support, you must make sure all cost items are included and adequate money is provided, despite pressure from management to reduce costs. If you attempt to downplay or under-plan costs to gain approval, you are courting failure once the cat's out of the bag.
Using
ConsultantsAlmost half of all project managers use consultants sometime during the ERP implementation process - in roles ranging from minor, to technical, to pivotal. It is important to remember that consultants are not your employees and have no on-going benefits to benefit from implementation. Don't rely on consultants to control their own costs - they are notorious for making changes, using a larger staff, and taking more time than is necessary. Even the best consultants need to charge as many hours as possible, and may use you as a profitable docking station between other efforts. Maintain full responsibility for who's working on your project and how much time they're billing you.
Maintain full responsibility for the project. Consultants make ready scapegoats for project managers who don't want to take the blame themselves. While consultants can be held accountable, they are never to blame. (They also may not be credited with a successful project either.) They are there to fill in knowledge gaps and provide expertise on a temporary basis.
Consultants can help your team "think outside the box," a difficult skill to cultivate when you're busy with day-to-day operations. Outside specialists represent a true bargain when they provide something you will only need once, at a fraction of the time and cost required to invent it yourself. A consultant operating in a specialized niche keeps up with current trends, and, within that niche, can do it better, faster, and cheaper than you can. If, however, the skill set is one you'll be needing after implementation, then it's best to go through training yourself.
Consultants also can be valuable for staff augmentation, helping with the extra work that develops as the project unfolds. When temporary staff is brought in, use them to do temporary activities, such as keeping the current system running. If you are converting data, building new procedures, and using the new systems, use your existing people. This gives them knowledge they will need in the future.
Who Are the
Decision Makers? Every company has decision makers, the people who make things happen. Seek out those who impact operations the most - in an official capacity or not - and place them on the steering committee where the project manger can interact with them in a group. Limit the project manager from having to explain decisions time and time again. If a project manager's decision is to be overridden, it must be within a steering committee meeting, never from the outside.
Essentially, the project manager is the key decision maker. There will be times throughout the project when this person will be called upon to make difficult choices, sometimes prioritizing tasks, other times resolving conflict between people. The project manager must be capable of making, defending, and standing by every decision - backing down will only decrease the likelihood of a project completed on time.
A project manager derives power from the commitment of corporate management to the project. Yet management is often held hostage to market conditions and ongoing financial problems. Not all companies have the resources to perform projects during downtimes, so commitment is key. Commitment alone can keep a project going. Without the desire to see a project through, projects that begin as attempts to gain more control over operations or to replace old technology often fail by the wayside when management attention is drawn away.
Management attention usually has a time limit. Generally, it is advisable to finish any project with the original project team and a stable steering committee management team. New members will have goals and agendas that may disrupt the overall project and slow its completion. Plan on having management's attention for a year, starting with the purchase decision. If implementation lasts longer that this, break the project into year-long pieces, and approve each section with renewed management commitment. For large companies, a year-long constraint seems unrealistic, but longer timelines often result in projects that either are grossly late or complete failures.
Seek out those who impact operations the most -
in an official capacity or not.
