Thursday, May 28, 2009

Business Process Re-Engineering and ERP Implementation

Thursday, May 28, 2009
Much has been written about the failure of Enterprise Resource Planning system implementation. Companies spending a fortune on ERP software implementation, only to find that the business performance has not improved at all. These large investment and negative ROIs have created a whirlpool of controversies; rampant company policies and even a number of lawsuits. For some, these have created a fear about making a big ERP mistake.
Most of the time ERP software vendors are the targets for blame when the anticipated results do not materialize.
While some companies see that the successful implementation of the system is quickly met, why others struggle with incomplete implementations and tenuous results? Is the ERP software or the software vendors the real culprits for the lack of business performance improvement? Let’s explore;
An ERP solution, successfully implemented, positively alerts the way company manages its back office, enabling it to enhance planning, execution, management, and control over a wide range of critical processes. However, it also depends on how much the system is accepted within the organization and how effectively the migration from old systems to new system is managed.
Certainly, it can often be argued that ERP system logic is sometimes illogical, functionality is missing, functions perform poorly and so on. But the accountability for the success lies to varying degree with the implementation of the new system and the business process re-engineering that goes with it; which is unquestionably a complex undertaking.
What we need is a new system” is the suggestion that comes up very often while discussing about the operational problems. At first glance, an ERP system will potentially solve many issues a company may have. However, upon careful analysis, if a company has significant process issues, a new system alone may not solve any of its problems. It may simply represent a new or different way to do exactly what was done before.

So often the systems are both blamed and suggested as the remedy for the ills of simply bad business process. As the famous quote, “a combination of old organization and a new system results only in an expensive old organization”


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