As we continue our series on the ERP implementation success and pitfalls and how to avoid them, we would today like to explore one danger: Shiny Object Syndrome.
ERP Failure: Shiny Object Syndrome
While you may not consider an ERP implementation project to be the most exciting proposition, you also know very well that it is a major, difficult change on the horizon. With many moving parts and processes, it’s very easy to lose track of your needs and buy into an ERP system with dazzling new features.
Sadly, your business doesn’t always need certain features, functionality, or customizations.
If you’ve ever bought a new car, you know the feeling. You start with relatively straightforward needs and a budget. However, once you start looking at cars or speaking with salespeople, you begin to hear about an exciting feature that you didn’t know existed. You’re convinced to add the feature and you end up paying more than you intended. The same goes for your ERP decision—on a much larger scale.
While many features of an ERP system are “must have” additions, there are many others which you may or may not need, ultimately costing you more money without delivering added value. These are the projects that end up over time and over budget, resulting in longer-than-expected payback periods and lower ROI.
However, if you take a tempered, disciplined, and well-documented approach to ERP selection, you can reduce the risk that you get sucked in by a feature or add-on.
Solution: Disciplined Decisions and Well-Documented Needs
Throughout your ERP planning process, you will be faced with a variety of decisions, exposed to many different value propositions, and hear a lot of input from your staff regarding “must have” functionality. However, not all of this functionality is truly must have—at least for the price.
With the average ERP software serving a company for 5-10 years, you need to find an appropriate balance between what you need now, what you need then, and eliminate the pieces that don’t benefit you. In their guide, 5 Steps to Navigating the ERP Decision-Making Process, Acumatica delivers necessary advice for companies: Prioritize Your Needs.
Plan for the Business You Intend to Have
In this, you need to start by picturing where your business is today and where it will be in the future using a “current state” and “future state” model. Take into consideration concepts like inventory levels, accuracy, production levels, completion, and lead time, customer service levels, and more. Picture where you are now and what you will need when you grow.
Now, sit down with your end users. As we said in our blog on building your team, the input from your end users can make or break your project, and it’s vital to demonstrate that you value their opinions. Listen to your end users’ needs—they are the ones who have to deal with a solution. Determine how important each feature is for a user or department, taking into consideration how valuable a feature may be.
Prioritize Needs: Four Categories to Watch
In evaluating functionality needs from each department, it’s important to know how important each feature is. In addition to asking employees to rank the importance of a certain feature, look at functionality through the following four lenses:
Absolute Requirements (Now and in the Future): These will be your deal breakers, functions that a solution must provide.
Highly Desirable Functions: Important to your business but not vital, solutions that offer benefits for your business and play an important role in narrowing down your selections.
Future Needs: Functionality that you don’t immediately need, but will be useful sometime in the future.
Nice to Haves: The features that are possibly helpful, but may or may not be necessary for your business. These could be added at a later date.
Take Control of Your Decision: Acumatica ERP from Milestone
If you can, note how much effort it will take to have a successful with any non-essential functionality so you can make an informed decision about including it in your project. For example, advanced planning takes considerable discipline and careful attention to supporting data (bills and routings, up-to-date activity reporting). Be sure not to let “nice-to-have” functions distract you from the main goals of getting a new ERP up and running. You can always plan a follow-on project for those advanced functions.
As you gain a better understanding of what has to be done, you can continue to add details and refinements to your project plan and schedule.