Defining the Success of your ERP Project

Defining success for an IT project seems to be inherently more difficult than defining successful financial expectations, or manufacturing objectives. Yet without an articulated set of post go-live expectations, the success of an ERP implementation becomes a matter of opinion – and in the worst case, a matter of infinite opinions. If an organization is lazy, and adopts a default metric of how many people are complaining about the new ERP system, then almost all implementations would be deemed failures. It is essential for the focus of the implementation team, for the health of the organization, and for appropriate allocation of resources that a set of measurable criteria be put into place prior to go-live which are the final arbiters of ERP success.

Think "Achievable"

Unless your implementation is within the aerospace industry, your success definition does not need to be rocket science. The litmus test of a sufficient definition is one that, no matter what else additional happens or is said, you will feel the implementation was well done. For example, a simple success statement could be “Convert over to ERP”. But if you couldn’t ship anything the first two days, would you be disappointed? If so, how about “Convert to ERP with no significant business disruption”. That’s better. How about “Convert to ERP with no significant business disruption and no negative impacts on external customers.” That’s even more specific, and leads to discussion about whether the correct phrase is “no negative impacts” or “no ERP-related negative impacts”.

Further Reading: Six Steps to ERP Success White Paper

It is also perfectly acceptable if success criteria are time phased, and represent a sequentially higher bar over time. For instance, an end of week #1 objective might be to have no more late orders than the average over the past twelve weeks. (If you do not have success criteria which take history into account, then the historical 20% late that you have always had will suddenly become 20% late because of ERP). An end of week #2 objective might be to have a reduction in late orders, have received no customer complaints as a result of the ERP objective, and to be billing at historical weekly averages. An end of week #3 objective might be all of the week #2 objectives plus no raw material or intermediate shortages. An end of week #4 objective might be all of weeks one through three, plus initial distribution of daily business activity reports. And so on.

The critical point is, a successful organization will have consensus on what constitutes success. It is well documented that if you administer random shocks to lab animals, eventually the animals simply retreat to a corner, and do not move, awaiting the next random shock. If an ERP team is allowed to be randomly criticized for failing to achieve unarticulated objectives, they will end up retreating to a metaphorical corner. Tell the ERP team how to be successful, and then congratulate them when they are.

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Phil Marshall

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Phil Marshall