Although hundreds, or even thousands of people can eventually be included in a major ERP implementation project (if we count employees who must be trained on the new system), let’s get the three major categories of the parties clear in our mind before we get too deep into the steps and phases of the project. Let’s list them in the preferred order of appearance in the project: the Company, the Project Manager and the Vendor.
If you’re the intended audience for this website—the executive who is tasked with learning more about the upcoming implementation project your organization is contemplating—your organization is the Company. To us, you’re the client, because you’re the one who hires us, the independent consulting Project Manager. To everyone else involved in the project, you’re the Company. The Company includes the business entity, the Board of Directors, the Executive Steering Committee, the C-Level executives (CEO, CFO, CIO, COO, etc.), the Executives, the Managers, the Department Heads and the employees, all the way down to the non-paid interns. The Company can also consist of various people or contractors hired by the Company to assist on its side of the implementation project.
The Project Manager
This is an independent consulting PM (individual or firm) who has no allegiance to any of the other parties in our Who’s Who list. The PM is entirely agnostic about the project and its components and players, and comes to the table free of any preconceived notions. The PM should be brought in at the first hint of a major ERP implementation project, to help the Company assess what is needed, and prepare a highly detailed Project Plan. The PM you select will be crucial to the project’s success or failure, so be careful to select a detail-oriented, highly experienced person or firm that is a straight-shooter and has a proven track record in this arena. Some PMs have a knack for assessing a project and spotting and handling potential problem areas, while others struggle clumsily through a succession of barely adequate completions. The right PM will fully assess your project, provide you with a detailed Project Plan and budget, and tell you to add 30 percent to cover the inevitable costs that will arise during the project. There can be other PMs involved in the project, e.g., one supplied by the Vendor or System Integrator on the project, or one on the staff of the Company. I highly recommend you utilize the professional services of an independent consulting PM with a great track record, and not rely solely on a PM with a personal stake in the project. [ask about engaging us]
The Software Vendor / System Integrator
Value Added Reseller (VAR) is yet another term for this category. These three terms are generally used interchangeably for the same entity—the firm or team that actually integrates the software and new hardware into your business systems. If the Company makes separate arrangements for its own System Integrator, let’s say it plans to rely on its own internal team to integrate the new ERP software, then this would be the exception where the Software Vendor / System Integrator are not the same entity. Generally, software providers like Microsoft, Oracle and NetSuite have their approved vendor lists, and they highly recommend each of those vendors, based more on the vendor’s ability to sell the software in question than any actual track record of successful ERP implementations. For the purposes of this discussion, we will refer to this entity as the Vendor, because at its heart, the Vendor’s focus is centered in selling the software and its own services as an integrator of the software.
With that understanding, the Company (you) must be wary of the representations made by the Vendor’s sales team. The answer to every pre-sale question is, “Yes, it will do that.” The software package being recommended by the Vendor is the answer to every problem the Company needs to solve. Don’t forget, that most vendors sell a single software package (or a limited number), and will always tell you that this particular software is best for your application—whether it is or not.
The Vendor will also parade a lineup of the industry’s top-rated tech and implementation specialists before the Company’s decision makers, and will promise the sun, the moon and the stars—all for a price that seems to be in line with what other vendors are proffering. No, there will be no need for an independent PM, because the Vendor graciously and generously provides a PM on its implementation team (what we term the fox in the hen house). There is little need for a detailed Project Plan, because the Vendor has been through this process so many times and ‘instinctively’ knows what to do. You see where this is going. As the project begins, the stellar cast of characters morphs into a troupe of recent graduates who are getting on-the-job training on your project, and the many “Yes” replies turn out to be, “Sure, to a limited extent. But if you want full functionality on that, we need to write up a change order”—often increasing the project cost by tens, if not hundreds of percentage points.
On the other hand, the Company will often try to beat the hell out of the Vendor, demanding Champaign on a beer budget, forcing freebies and considerations. This ‘unreasonable expectations’ approach is equally foolhardy, because lack of an adequate budget imperils the project as much as poor planning or incompetence. All of these acts of posturing and trying to get ahead of the other party leads to project failure. If you can imagine watching a horrific train wreck in super slow motion, taking months to end in catastrophe—that’s what all of this uninformed posturing leads to.
Selecting the correct Vendor for your ERP implementation is critical to its success. Unless you are a leading expert in large project implementation we highly recommend that you select your independent consulting PM at the outset, before any other decisions are made, and that you empower your PM to make informed recommendations about the Software, Vendor and other matters, giving significant deference to those recommendations.