A poor ERP implementation can lead to financial losses and loss of credibility among company...
The Importance Of Change Management When Implementing ERP
Developing effective change management is one of the most significant challenges that businesses face when implementing an Enterprise Resource Planning (ERP) solution.
Managers often feel that staff members will happily adopt ERP software to optimize their time, but this is rarely the case. Leaders often fail to consider the impact this change will have on business processes and employee satisfaction.
The fact is, an ERP system will drastically affect the way many of the employees in your company work, almost invariably resulting in strong resistance. Here’s when the role of the change manager comes into play.
What Is Change Management?
The people, processes, and systems that make up modern businesses are highly interconnected, making it essential to take a high-level view when managing change. A holistic approach to this process is also useful for improving the system’s efficiency and effectiveness.
As a result, change management is a process for facilitating organizational transitions, particularly its human elements. According to inventory management services provider Clear Spider, it helps employees understand the reasons for investing in ERP and embrace the changes to their current working environment.
Why Do You Need It?
Digital business solutions provider Columbus puts it clearly: people generally won't accept what they don't understand.
Therefore, resistance to a new ERP system is common because employees will have many questions about optimizing resources and how the system will benefit them. A change of this nature will affect the entire company, regardless of its size. Also, an ERP system increases employees' exposure to new data and process. Finally, these changes to daily tasks will have a learning curve.
There lies the importance of using organizational change management when implementing an ERP solution.
What Does It Take?
First, naming a change manager. It is paramount that one person takes over this responsibility, rather than distributing the role among all the members of your ERP deployment team.
The key issues that your change manager needs to address during an ERP implementation process are:
- Training Strategy
- Employee engagement
- Management buy-in
A new ERP system requires the change manager to address the workforce’s transition by developing a training strategy for automating manual processes, including the selection of trainers and superusers. It should also account for differences in training due to location and testing before the ERP solution streamlines business processes.
According to Training Industry, effective training at all levels is critical for this type of change. End-user training must be ongoing and consist of various classes, practical sessions, and workshops. A change manager can achieve this goal by providing users with training in business process automation specific to your organization's industry. This modeling type generally views high-performance end-users due to knowledge, skills, and a constant state of readiness.
Communication is an essential management strategy for any organization, and it's vital for getting members to accept change. A change manager who can answer questions proactively will make the solution more attractive to employees who spend their time searching for data.
This benefit makes it necessary to develop a communication plan that will coach managers on delivering messages to their team members and providing updates as they become available. The users' culture, education, and language all significantly affect the most useful messaging.
An effective organizational response to an ERP solution should include cultural change. ERP projects can fail solely because of the employees' initial frustration. This resistance may also have an institutional basis, which often includes union shops.
Factors such as demographic profiles, education, and language all dramatically affect the understanding employees have regarding the ERP solution's objectives and risks. Change management in ERP implementation projects must consider these factors when developing their plans for creating the cultural change needed for saving money and time.
ERP implementation plans often fail to address the challenge of increasing employee satisfaction, but this step is crucial for ensuring that it captures all organizational issues and opportunities. This oversight is typically due to budget constraints, although its cost is justifiable in the long term. The right methodologies can create the employee engagement that an ERP successful implementation requires based on the project's stakeholders.
An ERP solution usually requires management buy-in across all the organization's departments. Employees are primarily loyal to their immediate leaders, so deployment will fail to improve productivity if the organization's entire leadership doesn't support it. These executives must have visibility in managing problems and setting goals for the project. They should also measure the implementation's success through a set of benchmarks for achievements.
5 Key Takeaways From This Blog
Resistance to change in an organization is natural, especially when it affects known systems, processes, and practices.
Change management helps leaders and workers understand the reasons behind the change.
Adopting an ERP solution changes workers’ daily life and tasks, so initial frustration is in order.
Successful change management will recognize the signs of resistance early in the ERP implementation process.
A change manager will present the new system's features and explain how it will benefit employees and leaders.