Critical evaluation of the issues and challenges during implementing ERP
The major issues and challenges faced while implementing ERP in industries need to be properly identified. Ranjan, Jha and Pal (2016) stated that the issues and challenges can be categorized into six major themes such as reengineering, commitment of top management, funds, skilled manpower and implementation time as well as data fill-in.
Reengineering: One of the main issues is the requirement of reengineering the organization in order to process smooth fill-in of enterprise resource planning. It can be concluded that deploying ERP system engages restructuring the existing procedure of business to the best business procedure standard, which will accommodate ERP. The organization includes alternatives for reengineering as well as restructuring the process (Conteh and Akhtar 2015). The findings can collaborate arguments that reengineering is one of the procedures of fixing the process of an organization into newly installed ERP system for ensuring efficiency as well as productivity. In order to achieve the desire of gaining competitive advantages, the organization needs to be willing to restructure of doing the business in order to accommodate the process of innovation provided by the system. The changes need to be done within overall business process management methodology.
Top management: The success of a project depends on strong, sustainable commitment of management of the organization. It has been pointed out that commitment of top management is considered as less important compared to other factors. However, the role of top management cannot be avoided (Babaei et al. 2015). In addition, overall commitment of an organization is visible, well defined as well as felt as a sure way in order to ensure successful implementation of projects.
Funds: Funding is one of the major issues of a project. Facing ERP implementation in early phase need to be considered properly. There is a difference between commitment of top management commitment as well as implementation of the project. However, as the top management as well as finding required amending, it is important to improve the process.
Lack of skilled manpower: Lack of skilled manpower is identified as one of the key issues as well as challenges for ERP implementation. However, it has been revealed that the organization having intension of implementing ERP system needs to dedicate some best staffs for the projects. Zamre and Ismail (2015) mentioned that iinternal staffs on the particular project will exhibit specific ability in order to comprehend the overall requirements of the organization. Apart from these, some of ERP constants have lack of sound knowledge for implementing ERP.
Implementation time: The issue of timing is identified as critical ERP implementation. ERP systems usually come in modular fashion as well as cannot be implemented in the system. Organizations need to follow phase-in approach in which a module can be implemented at a time. The issues with ERP package need to be configured properly to a specific type of a business (Nordin and Adegoke 2015). Hence, more customization required in this process that will take to roll software out and keep it up-to-date. Thus, implementation time is an important factor for determining success of ERP implementation.
Data fill–in: Along with the other challenges stated above, data fill-in is one of the major challenges faced by the organizations in implementing ERP. The safe as well as comprehensive transfer of data from old systems to ERP is generally rigorous as well as delicates. The share volume of data transferred is greater than normal transaction load, which will be carried out by the system. Thus, in order to process the system successfully, the data needs to be kept in a stable state as well as transfer in a safe way.
In addition, in this competitive environment, it is required to select perfect product, which is essential for achieving productivity gains. There are more than 500 applications available in the market. Thus, selection of perfect ERP application for business, it is required to understand the previous projects of vendor, industry vertical as well as experience (Sun et al. 2015). On the other hand, as senior management of an organization has an important role to be played for ERP implementation. It is important for involving top management in ERP implementation process. Any form of ignorance may also cause ineffective decisions as well as delayed operations.
Many organizations do not realize time consumption of ERP implementation process. An ERP system is deployed systematically as it is standard and requires to be designed for a specific business. In addition, it is required to handle the procedure according to the demands of the organizations. Moreover, many of the organization wants implementing ERP system require assigning for the best employees for implementing the system successfully. The organizations appoint external assistance (Ali and Miller 2017). However, internal employees are more preferred. It is also observed that despite of training, several employees leave the company after implanting the ERP system. It can affect the rate of development of the organization immensely.
Testing of ERP system does not mean if it is working smoothly or not. However, performance of the system needs to fulfil requirement of the user. Hence, insufficient testing of the particular system may lead to costly process. Moreover, an ERP system has high maintenance cost. Thus, if is managed casually, it includes power to fracture the organization. Investment in internal hardware is also one of the major aspects in implementing ERP. Working on a slow system is very unproductive as well as frustrating. Applications of ERP need adequate storage as well as high work performance (Bakunzibake et al. 2016). Low investment in internal hardware may have outcome in several issues of software. ERP has obtained recognition for having competitive factors.
Setting goals for ERP software implementation is a goals as well as objections for ERP implementation. Without proper goals, it is required to define outset of the project. The goals are required to define at the outset of the project. Designated to the process of implementation team is the beginning of the process and each of the team members along with the departmental requirements (Kulkarni et al. 2015). Flexibility challenges of ERP software may force an adopted for changing business process in order to fit with ERP system model. It requires reengineering of the steps required to complete business tasks as well as training of the employees and business partners. Hence, it is important to be aware of ERP business process and understand the types of changes for the organization.
Executive summary and critical reflections on industry talk
The respondents in the industry provided insight into the difficulties experienced at the time of implementing ERP. One of the respondents in the industry said that major advantage of ERP usually comes from reengineering the existing business. On the other hand, all the procedure in an organization needs to conform to ERP model in order to ensure smooth running along with productivity stated by one of the respondents in the industry. Moreover, it is also mentioned that an organization needs to change its procedure in order to conform to ERP package (Chofreh et al. 2016). In addition, it helps to customize software in order to meet its requirements. As the process of implementation reduces costs of customization as well as future maintenance and upgrading expanse costs of customization, the organization has only alternatives for reengineering and restructures process for suiting ERP in order to save cost on customizing ERP.
The respondents also identified that commitment of top management as a part of the issues as well as challenges facing successful ERP implementation. In addition, implementation of ERP system is not considered as a matter of changing system of software. However, due to massive impact on the competitive benefits, it is important for the organization to involve and make cooperation in each of the steps of ERP implementation as very important. It has been pointed out by one of the respondents that during implementation of ERP, an organization goes through major transformation (Saadé et al. 2017). In this perspective, the management needs to be careful in strategic planning as well as meticulously deployed. Several parts of a business utilizing to work in silos need to be tightly integrated for ERP in order to work efficiently.
However, it was argued by one of the respondents that several ERP projects are abandoned for the fact that several board members are of the view that information technology engulfs huge fund with little to compensate for it. In this case, lack of close monitoring along with commitment to ERP projects by top members of the management are the part of the factors for abandonment (Katerattanakul et al. 2014). Thus, the success of a major project such as ERP implementation completely depends on strong and sustainable commitment of the top management. However, commitment of an overall organization is visible, well defined as well as felt in a sure way in order to ensure successful implementation of ERP.
The respondents have identified fund as one of the major issue as well as challenge facing while implementing ERP in early phase. It has also been mentioned by one of the respondents that ERP package is complicated and vast, making several ringgits for rolling out. The concern generally divides management where some are calling for the requirement in order to inject more fund into the process of procurement of new technologies in order to obtain competitive benefits over competitors (Katerattanakul et al. 2014). It has also been argued that new technologies can engulf huge fund with little for compensating for it. One of the respondents reported that IT department is the only part of the enterprise that does not help to bring revenue. However, several funds for the operations are engulfed by it. Hence, ERP implementation management determines extensive preparation for deflecting wastefulness.
On the other hand, finding contradicts arguments that fund is considered as one of the main functions of top management commitment. The concerns regarding the process of investing funds lead to extra value of the business quickly, whereas profitability is one of the greatest worries. Lack of skilled manpower was also addressed as one of the key issue as well as a challenge to ERP implementation (Abu-Shanab et al. 2015). However, it was revealed that organization having intension for implementation of ERP system need to be dedicated for the best employees to the project. It has been suggested that internal staffs need to be allowed to head the team of implementation as they pose good knowledge regarding structure as well as requirement of the organization.
It was also observed that some of ERP consultants have lack of in-depth knowledge regarding ERP implementation that is required for adequate support the organization. It was also observed that the consultants were not able to train the employee of the organization sufficiently on the system. The particular factor hinders the smooth process of running IT department. A respondent in the industry has mentioned that there is lack of competent consultants with ERP market while the competent organization is very expensive in order to involve by SMEs.
Report on the industry visit comprising brief introduction of the organization and executive summary of critical reflections and observation
After visiting the organizations regarding the issues of ERP implementation, it has been found that implementation of ERP comes with massive competitive benefits for business. However, there are difficulties as well as challenges associated with its implementation process. ERP has provided important enhancements in efficiency. However, the system could be a curse and drag the system into spiralling inefficiency along with wastefulness. Thus, planning for ERP systems and implantation needs an integrated systematic approach in order to meet with the demands of different functional concerns (Slabbert et al. 2016). Consequently, many employees in the industry has argued that currently on the requirement for making further strengthen the existing framework of ERP system. It is required creating less complexity as well as complications for improving smooth and successful implementation.
However, it has been pointed out that abandonment of ERO occurs in SMEs as several consultants and project managers have tendency in adopting the implementation framework designed for large organizations. Thus, it is called for further investigation of the issues that leads to abandonment of ERP in the industry. On the other hand, it has been argued that complication as well as complexity of ERP implementation has lack of detailed explanatory as well as comprehension of Critical Success Factors (Slabbert et al. 2016). The researches pointed out that there is requirement for stepwise detailed strategies for ERP implementation.
In order to combat with the challenges faced while implementing strategies for implementing ERP in the organization, the employees incorporate risks as well as management plans in the change management plan. Moreover, breakdown the project into several natural phases or the subsystems for modular planning as well as development of cross-functional communication plans for change management will be helpful to mitigate the issues (Mitra and Mishra 2016). Using proper planning styles for multiple tasks and detailed task plan for tangible tasks along with personal communication plans for change management is helpful. Apart from this, it is required to prepare plans for recruitment; selection as well as training of the essential personnel for the project would be helpful.
Apart from this, formulation of a network in order to collect user requirements as well as user feedback and setting up process for monitoring along with feedback network to collect control information at every stage of the implementation process is useful for implementing ERP system. One of the respondents in the industry that post implementation strategies have also a significant role for accepting ERP systems also mentions it (Slabbert et al. 2016). The requirement of an IT system as well as structures have tendency to make changes on the completion of the project. It is required to understand the objectives of the ERP system fully along with the structures tending to change after completing the project.
It has been mentioned that cost estimates against actual reason is varied. On the other hand, it is important to evaluate any possible enhancement to the system. The degree of staff consultation need to be evaluated as well as enhancement suggested. Evaluation of post-implementation can be helpful to suggest enhanced process in avoiding failure in similar projects in the enterprise. Hence, it can be stated that ERP implementation brings many advantages and obtains to the enterprise. However, challenges and difficulties are associated with it. The issues and challenges are detected as reengineering, commitment of top management, funds, data fill-in, skilled manpower and time of implementation.
The findings from industry visits revealed that the critical factors are important to be considered while implementing ERP in the industry. It is viral that implementation is achieved in proper stages. Trying to deploy will be helpful to lead several confusion as well as chaos. In addition, adequate training is necessary during as well as after the process of implementation. B However, lack of appropriate skills is necessary in order to lead to non-availability of specific e functionalities (Katerattanakul et al. 2014). In addition, it is also mentioned that lack of support from senior management. Compatibility issues with ERP modules can lead to the difficulties in integrating the modules. The organization is attached with several vendors in order to implement distinctive modules based on competency.
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