Ignoring the warning signs of an ERP project about to spin out of control is costly.
COMMENTS
Enterprise Resource Planning (ERP) implementations are never easy. Many projects start with excitement and high levels of participation but quickly devolve into run-on projects with that are over budget and rife with change orders. Team members are deflated and often feel as if the project will be never-ending.
Recovering and bringing the project to completion often costs as much as the original budget and end users do everything to work around the new system. ROI is nowhere near what was originally promised, key stake holders lose their jobs and the system is universally hated.
There are three warning signs that an ERP project is starting to spin out of control. Addressing them quickly helps avoid going through a project recovery cycle. The warning signs include:
- Steering Committee Apathy
- Out of Date Project Plan
- Inconsistent Issue Tracking and Status Reporting
IT will have visibility to these signs long before key stakeholders become aware that a problem exists. IT needs to take responsibility to notify business partners and help make sure the weaknesses are addressed quickly and effectively.
Steering Committee Apathy
A Steering Committee that is comprised of key stakeholders with P&L responsibility provides a company-wide perspective when considering recommendations from project team members. The Committee needs to meet on a regular basis throughout the project to ensure the project stays on track.
The euphoria of creating a Steering Committee and kicking off a long-term ERP project is often replaced by indifference and apathy. Key stakeholders who were very active in the ERP selection and project kick off phases stop coming to meetings. Critical decisions made by the remaining attendees are second guessed. The Steering Committee no longer has power over the project and becomes ineffective.
Steering Committee dis-engagement is a clear sign the project is at risk. The project team members will do their best to make business decisions, often in a silo. As a result, change orders will be generated on a regular basis, processes will not be efficient and end users will not be eager to accept the resulting changes in how day-to-day activities will be performed.
Out of Date Project Plan
Good project managers create an overall plan and budget at the beginning of the project then parse out one or two week chunks of work to responsible team members. The plan and budget is updated and communicated throughout the project to ensure team members understand how tasks are interrelated and do no lose sight of the overall end-goal. Most importantly an updated plan and budget helps the team identify issues and road blocks early, preventing unnecessary surprises.
On many projects the overall plan and budget stop being updated on a regular basis as the manager starts focusing on managing day-to-day activities. Issues logs, team and company politics, status reporting, and integrator delivery problems take up the bulk of a project manager’s day, leaving little time to update the plan.
A lack of an updated project plan is a second sign the project will not be completed on time or on budget. Project team members will get lost focusing on tactical day-to-day activities that may not be necessary. Critical tasks are overlooked and the project seems to go on forever. Worse, third party participation never seems to end – the consultants just do not go home.
Inconsistent Issue Tracking and Status Reporting
Issue tracking and status reporting is a key tool for clear communications among all impacted by the ERP project. Steering Committee members are kept up to date on key issues requiring decisions. Team members understand where to focus efforts to keep the project on track. Roadblocks are tackled as a team and the project is kept on track. End users clearly understand when to participate in the project and plan accordingly to help minimize being overloaded.
Project issues logs and status reports can be tedious to create and can be easily overlooked when the Steering Committee loses interest in the project. Project managers expect issues to be resolved once identified and rely on ‘word of mouth’ to keep team members up to date. End users lose interest in the project.
Critical issues, configurations, enhancements and reports seem to get stuck at 80% and never get ‘complete’ when issues are no longer tracked. Project team members become frustrated because solving one problem creates another elsewhere. The systems integrators focus on completing simple configuration and development tasks, leaving critical project components incomplete.
Completing the ‘Never-Ending’ Project
The three warning signs need to be addressed by revamping the overall project governance model to ensure project success. The project manager should start by updating the project issues log while gathering the latest status for on-going tasks. This information is then used to update the project plan taking into consideration tasks that are behind schedule and the impact on project budget.
The team should use the updated information as a way to reengage the Steering Committee. The first sets of meetings should focus on confirming or redefining the meaning of success, obtaining approval to necessary changes to the project budget and schedule. Once the changes have been approved, the Committee members need agreement on continued participation through project completion. Most importantly, the Committee members need to agree on a protocol to hold each other accountable going forward.
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