Luyện nói tiếng Anh bằng Shadowing qua video: Why Do ERP Software Implementations Fail? [Top 5 Root Causes of ERP Failures]
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It's no secret that most ERP implementations fail.
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However, what is a secret is understanding why those implementations fail.
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That's what I want to talk about here today.
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My name is Eric Kimberling.
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I'm the CEO of Third Stage Consulting.
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We're an independent consulting firm that helps clients throughout the world reach their third stage of digital transformation success.
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And there are many studies out there that show that anywhere between 70 to 80 percent or more of ERP implementations fail.
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In fact, this statistic hasn't really changed much in the 25 years that I've been helping clients with their ERP implementations.
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Technology has changed, the world has changed, and a lot of other things have changed,
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but the one thing that seems to be consistent is that companies still struggle with their ERP implementations.
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So what I want to do today is unpack this a bit more
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and understand what those common root causes are of why ERP implementations fail
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and more importantly help you understand what you can do differently to ensure that your project is successful.
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The good news is that this isn't rocket science, there's no big surprises here, but when you understand what those root causes are
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and you avoid some of those root causes you are dramatically increasing your odds of success
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and dramatically decreasing your odds of failure.
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Now for more information about implementation best practices as it relates to your erp implementation
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when you're done watching this video i encourage you to download
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and read our lessons from 1000 erp implementations white paper it's a ebook
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that we wrote that talks about 20 different best practices
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and lessons learned from helping clients all over the world through their erp implementations
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and digital transformations you can read
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that ebook by scanning the qr code in front of you
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or you can go to the links in the description field below.
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The first common reason why ERP implementations fail is because organizations have unrealistic expectations to begin with.
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And the reason this is so powerful is
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because as fast as technology is changing and as much as technology can do today, it creates this false sense of hope
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that we as an organization can quickly adapt to the software and we can quickly
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realize business value from different technologies that are out there and don't get me wrong
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erp software today can deliver dramatic value to most organizations the
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problem is most organizations don't realize how difficult it is to
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get from where you are today to where you could be with new technology and
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so as a result what ends up happening is not only
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do you have unrealistic expectations of how quick you might get to
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that business value but when you realize
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that a project is going to take longer than you expect it's going to cost more than expected
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and require more resources than expected what ends up happening then is
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that organizations end up scaling back
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and throttling back on some of the key critical success factors
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that are critical to make their project successful for example let's just say we have an organization
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that thinks they can go through their erp implementation in 18 months
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but 18 months was never realistic it was always going to take this organization say 24
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or 30 months to go through their implementation What ends up happening is when the organization gets partway through that project, maybe halfway through or two -thirds of the way through,
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they start to realize that they have compressed a timeline that's just not at all realistic.
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So they have one of two choices.
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They can either delay the project and spend a lot more time and money than they expected,
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which oftentimes is not possible with boards of directors and other executives holding the project team accountable,
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or they can scale back on project activities and just try to force fit the ARP implementation into a shorter duration.
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When they do the latter, what ends up happening is they end up cutting things that are absolutely critical to success.
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They end up cutting things like organizational change management, or they'll cut a couple of iterations of user acceptance testing.
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They might spend a little bit less time on requirements gathering up front
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if they understand early on that they're behind the eight ball on the timeline.
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So these are just a few examples of how organizations end
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up making a bunch of bad decisions later in a project
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because they had unrealistic expectations to begin with
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so one of the biggest things you can do to ensure you avoid this pitfall is to ensure
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that you have realistic expectations and do so by taking software vendor
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and system integrator and implementation partner proposals on a time frame
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and a budget take those with a grain of salt
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and make sure you add your own dose of reality from an objective perspective to ensure
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that you have the appropriate amount of time budget
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and resources dedicated to the project the next common mistake
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that organizations make that lead them to failure is
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that they don't spend enough time and effort upfront in the implementation planning process
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and this is a fascinating organizational dynamic that I've seen time
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and time again throughout my career what ends up happening is you get an organization
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that is committed to a digital transformation and an ERP implementation, they go through an evaluation process and they select the software
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that they are convinced will be the right answer for them going forward
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and it probably is it probably is the right answer
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or a really good answer going forward and it's at
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that point in the project that momentum
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and excitement for the project is the highest it's never going to be
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that high again so the team ends up rushing into the implementation
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because they're excited they want to get started they want to start building stuff they want to see
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and touch and feel the technology
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and that's all good stuff you absolutely need to do that
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but the problem with that is that
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when you jump too quickly into the implementation phase without having a really solid plan
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and a really solid vision of what it is you want to be
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when you grow up as an organization you're going to spend a lot of time
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and money later on spinning your wheels trying to figure out what it is you want to be
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when you grow up when you're in the middle of an implementation
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so the key here is to make sure you dedicate time
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in your project it's sort of a phase zero an implementation
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planning phase that's after the selection phase of the project
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but it's before you get into the implementation and taking that time to really establish a blueprint for the project,
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a blueprint for your business processes and what the organization is going to look like, which modules you're going to deploy and when, how are you going to resource the project,
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mobilizing the resources, getting your change strategy in place, all that stuff, the more time you spend doing that up front,
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you're going to save exponentially more time and money later on.
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So it's critical that you spend time defining this implementation phase.
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And to learn more about what this implementation phase should look like, I encourage you to check out this video right here.
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This video for my YouTube channel dives into the implementation planning
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and implementation readiness phase of the project in a lot more detail.
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If you watch that video, it will describe some of the different activities you should be focused on to avoid this common pitfall.
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Another common reason why ERP implementations fail is
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because executives don't have a clear vision
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or they haven't articulated a clear vision of what it is this ERP implementation is going to be to the organization.
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Another common dynamic within this is that executive teams themselves oftentimes aren't aligned on what that vision is.
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And so when you have an executive team
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that doesn't have alignment amongst themselves and or they haven't clearly defined
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and articulated to the organization what this ERP implementation means to the organization going forward, that's going to create a lot of problems,
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confusion, chaos, and misdirection as it relates to the ERP implementation.
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Now a lot of times executives will say well we're going to go through this ERP implementation because we have to.
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Our software vendor is forcing us off our old legacy system
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and now we need to move to a migration to a newer software.
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Or it could be that our old system is old, it's broken, we can't scale as a company and therefore we need new technologies and tools to help us grow.
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Those are good starting points, but that cannot be the basis and the foundation for the entire justification for why you're going through the project.
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You need to have and articulate a clearer vision of what the ERP implementation is going to do for the organization.
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For example, is it going to help us improve our customer experience?
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If so, how?
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Is it going to improve the employee experience?
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If so, how?
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What are some of the details of how that will look?
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Is it going to help us improve our operations, help us be more efficient help us sell more
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and generate more revenue whatever the business benefits are you want to not only define what they are
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and what the value is to the organization
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but get into more detail and granularity of what that operating model
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and that organizational model is going to be in
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that future state it's not enough to say we're just going to deploy sap
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or oracle or microsoft or whatever it is you need to go beyond
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that and clearly articulate what the vision for the project is.
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And the more time and effort you spend defining this vision and the more effective you are at defining that vision,
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the more tailwinds you'll have supporting you and the project team going through the ERP implementation.
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So one of the biggest things you can do to avoid ERP implementation failure is to ensure
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that before you get started on your implementation, that you have that clear alignment and vision from the executive team.
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One of the most common root causes for ERP implementation failure is a lack of focus on organizational change management.
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Or if there's a focus on organizational change management, it just isn't effective.
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This is one of the root causes that can lead to a lot of other symptoms within an ERP implementation.
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And simply put, if you don't address the people side of change, you don't ensure that your people are fully adopting new processes and new tools,
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you're just going to end up with a bunch of shelfware or investments in technology that is not delivering business value,
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and that has to lead you to the question of why are we doing this project in the first place
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if we're not getting the business value that we could and should be getting from it.
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So the key here is to not get too caught up in the technology pieces and components of your ERP implementation,
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but instead to focus more time and effort on the organizational change management piece.
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Because the better job you do on organizational change management, the more likely it is you are to be successful.
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And when we look at ERP implementation failures, particularly as it relates to lawsuits that we've been hired to testify in in courts,
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we find that the number one most common theme and pattern among those failures is a lack of organizational change management.
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The organization did not focus, for whatever reason, enough on organizational change.
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They didn't address the people aspects of change, and they focused too much time and effort on the technology sides of change.
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So one of the biggest things you can do is ensure
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that you have a solid and effective change management strategy and plan before starting your ERP implementation.
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Now for more advice and tips on how to create that organizational change strategy and plan, I encourage you to check out my playlist, which you can find right here.
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It's a YouTube playlist that has all of my YouTube videos that talk about organizational change management.
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So check out this link right here.
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That'll give you a playlist that you can go through
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and watch some more videos
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that describe how to go about the change management process now the fifth
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and final reason I'll talk about today of why ERP implementations fail is
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because the organization doesn't have a clear definition of success how
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will we define success of our ERP implementation for some organizations it could be
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that we're going to come in on time and on budget
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and that alone is a tricky proposition and most organizations fail at even that most basic fundamental definition of success. But beyond
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that, most organizations don't have a good vision of what it
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is they want to get out of the ERP implementation after they've gone through it.
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In other words, what is our business case?
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What's the ROI?
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Where are we going to get the business value?
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Where are the dollars and cents going to come from?
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Those are all things that need to be defined clearly on, not only so that we can ensure that we maximize the business value post -implementation, but just as importantly, so
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that we have clear direction as we're going through the implementation itself in other words having
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that clear vision of success can serve as a sort of a guardrail for the project
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and a north star
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that guides us in the right direction as we're going through the implementation every erp implementation room requires hundreds
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if not thousands of decisions about how your business is going
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to run how it's going to look what sorts of technologies you will
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or will not deploy whether or not you're going to configure the software
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or customize the software or integrate it to other third -party systems a lot of different decisions
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that materially affect the scope and the cost and the risk of the project.
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And if you don't have
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that clear vision for what it is success looks like for the project
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and what you want your organization to look like on the other side, then you're headed aimlessly into the darkness of digital transformation or an ERP implementation.
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So these are five of the most common reasons why ERP implementations fail.
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And hopefully I've given you some tips and guidance on how to avoid some of these common pitfalls.
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For more information and best practices around ERP implementation, I encourage you to download our Lessons from 1000 ERP Implementation eBook,
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and that eBook will provide a number of best practices and lessons that will help you through your digital transformation, including some additional risks and pitfalls to be aware of,
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in addition to what I've talked about here today.
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So you can read that eBook by scanning the QR code in front of you, or you can click on the links in the description field below.
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So I hope you found this information useful, and hope you have a great day.
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understand why that is I didn't like that some of those pipe pit that now the fifth and final
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fifth and final what oh okay I'm like what are we talking about what's this video about I don't remember
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15 từ đáng học trong video, kèm phiên âm và nghĩa:
| Từ | Phiên âm | Nghĩa |
|---|---|---|
| lesson danh từ | /ˈlɛs.ən/ | bài, bài học |
| encourage động từ | /ɪnˈkʌɹ.ɪd͡ʒ/ | cổ vũ, khích lệ |
| resource danh từ | /ɹɪˈzɔːs/ | tài nguyên |
| odd tính từ | /ɑd/ | kỳ cục |
| vendor danh từ | /ˈvɛn.dɚ/ | ngưởi bán hàng rong |
| consistent tính từ | /kənˈsɪs.tənt/ | phù hợp, thích hợp |
| select động từ | /sɪˈlɛkt/ | lựa |
| hire động từ | /ˈhaɪɹ/ | thuê, mướn |
| spin động từ | /spɪn/ | quay |
| objective danh từ | /ɒbˈd͡ʒɛk.tɪv/ | mục tiêu, mục đích |
| component danh từ | /kəmˈpoʊ.nənt/ | bộ phận |
| amongst | /əˈmʌŋst/ | giữa, trong số |
| rocket danh từ | /ˈɹɑk.ɪt/ | động cơ tên lửa, tên lửa |
| darkness danh từ | /ˈdɑɹk.nɪs/ | bóng tối |
| chaos danh từ | /ˈkeɪˌɑs/ | hỗn loạn |
Cụm động từ bạn sẽ nghe
| Từ | Nghĩa |
|---|---|
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Ngữ pháp trong video
Những cấu trúc người nói dùng nhiều nhất, kèm đúng cụm từ trong video:
| Cấu trúc | Trong video |
|---|---|
| Thì hiện tại hoàn thành have/has + quá khứ phân từ — việc đã xảy ra nhưng còn liên quan đến hiện tại | hasn't really changed · has changed · have compressed |
| Câu bị động be + quá khứ phân từ — nhấn vào việc xảy ra, không phải người làm | is committed · are convinced · should be focused |
Phát âm cần chú ý
Người nói dùng 50 dạng rút gọn, ví dụ don't, you're, we're. Hãy nói theo dạng ngắn đúng như bạn nghe.
- Âm “th”: gather /ˈɡæðɚ/, throttle /ˈθɹɔ.tl̩/
- Âm “sh” và “zh”: implementation /ˌɪmplɪmənˈteɪʃən/, organizational /ˌɔː(ɹ)ɡənɪˈzeɪʃənəl/, transformation /ˌtɹæns.fɔɹˈmeɪ.ʃən/, expectation /ˌɛk.spɛkˈteɪ.ʃən/, rush /ɹʌʃ/
- Từ dài — đặt trọng âm cho đúng: implementation /ˌɪmplɪmənˈteɪʃən/, organizational /ˌɔː(ɹ)ɡənɪˈzeɪʃənəl/, transformation /ˌtɹæns.fɔɹˈmeɪ.ʃən/, expectation /ˌɛk.spɛkˈteɪ.ʃən/, articulate /ɑːɹˈtɪk.jə.leɪt/
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