PA’s Peter Lumley, an enterprise resource planning (ERP) expert, is quoted in an article in the Financial Times. Peter gives his view on the potential hazards of ERP system implementations.
Peter points out that the cost and complexity of ERP systems provided by SAP, Oracle and Microsoft make them more suitable for large multinationals.
Peter also points out that their flexibility is part of the problem: “People think ‘we’ll just spend a little money and have this adapted’, but the successful ERPs are those that are as simple as possible.”
Another problem is that ERP originated in a manufacturing environment, and is less suited to other commercial applications. Predicting requirements is also difficult. Peter compares this to designing your own car from scratch, in which case you would almost certainly make mistakes. “Far better to buy an imperfect vehicle and use it, making gradual enhancements as you go.”
Clients often struggle to articulate their processes, and across a multinational organisation there can be millions of parameters that need to be set, so there are many opportunities to get it wrong. The strength of an ERP is that it is massively connected, says Peter. “But if implementers make wrong connections and wire back into the switch they are going to get a jolt.”
Peter goes on to talk about the importance of strong leadership. The unhappy customers are the ones who see ERP as putting in technology, says Peter. "The happy ones are those who see it as a way to change the business leading from the top.”
You can read the article in full here.
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