With the whole world investing in digital right now, there will be a myriad of success stories and unfortunately, quite a few failures. And so, ensuring a project has the right blend of skills and talent, has never been so important to the future of each organisation and their critical projects. Here we look at some of the pitfalls organisations should consider when implementing an ERP system, specifically looking at how and when to build an internal function that you can rely on.
Balance is key
Achieving the right balance of internal vs partner or system integrator (SI) resource is paramount to delivering a successful ERP implementation. Indeed, how a team is composed will dictate how the organisation intends to operate and maintain the system over its lifecycle. It is also crucial for the successful uptake of the system internally. By building a strong internal capability at the right time, organisations will benefit, from:
•Internal knowledge that stays inside the business
•Transition + support is simpler
•Continued service for enhancements
•Cost - often a blended team, rather than over-reliance on a partner only, can significantly reduce costs
Getting this right is essential for many organisations; aside from the cost of consultancy resource, motivations for candidates working directly for the end-user differ and they tend to be much more invested in the success of a project. However, relying solely on internal resource too early can be detrimental if there is not sufficient experience or technical knowledge, and this is where organisations tend to fail; it is essential to plan ahead and begin building internal resource as soon as possible.
According to Adrian Smythe, a project manager with over 20yrs experience on both with SI and internal teams, “The internal team should start the project-prep work way ahead of a partner even stepping foot in the door. This includes strategy, business analysis, and an appropriate level of planning. It’s vital for a successful project to have a strong core team.”
Here are his 4 top insights for a successful project delivery:
The customer is accountable for the success or failure of the project; and you cannot delegate accountability!
You can delegate responsibility, to a partner perhaps, but the partner can only accept responsibility if they have everything they need; including data, resources, and even trust. Achieving this is a collaboration.
As the experienced ‘professionals’ the partner should guide the customer through important areas of the project. Requirement gathering workshops should be led by sufficiently skilled resources from the partner, and then ‘sanity checked’ by the customer before signing off.
Led by an executive level sponsor, the core internal team needs to be trusted by the business. As such, they should be tenured, with experience and gravitas.
So, what is right for you, and when do you need to decide?
Naturally, over time the composition of the team will change. Typically, the initial phases will have a higher concentration of partner resource and specialist contractors, but as the project matures and knowledge transfer occurs, the balance shifts towards enhancing the internal team, with a reduction in the partner and contractor resource. See example below.
For global implementations we recommend building internal capabilities to take over on the 2nd or 3rd role out. This way you have a strong template in place that’s been defined by the experts which can be replicated by an internal function, as the pitfalls and potential areas for failure already have been identified, and hopefully, addressed. However, there are always challenges in any global rollout where different countries have different priorities and cultural influences, not to mention massively varied finance and tax implications. So, the need for localised input and support is often key.
Building a Centre of Excellence
Another way to address the challenges faced in a global implementation is to build a Centre of Excellence (CoE); if done correctly, it will work as a central function that can break down geographic and organizational silos in order to bring together like minded people with similar business goals, whilst at the same time providing standards, consistency, and governance to the organization.
A Centre of Excellence is a team of dedicated individuals managed from a common central point, often acting separately from the main practice or organization, to avoid bias or influence. To be successful, the CoE should have a set of clearly defined standards and expectations to drive its initiative and refine its focus. Understanding what these are, should help to identify which individuals need to be involved.
Consider the following areas as a starting point: leveraging expertise or subject matter experts, those with influence or strong collaboration skills, consider the necessity of alignment of technologies, or the need for knowledge transfer – especially, if relying on external resource.
In our experience helping organisations to build CoE’s, we have found the following roles to be essential within an ERP programme:
Whereas, larger or more complex projects may look like, this:
Data Migration Developer(s)
All project implementations are different and the timing or necessity for building internal capabilities will depend on the strength of talent already in the organization, and how well it is setup to support the transformation journey. However, it should not be overlooked and can often be integral to the success of the project, saving organisations time and playing to the strengths of having internal sponsors to align new technologies. Paying a partner then sitting back to watch your plan come together, isn’t an option!
Building a centre of excellence is a fantastic way to deliver consistency and standards and is key to driving a global implementation, but remember, it doesn’t have to be one or the other; permanent resource can be supplemented by specialist contractors at any time. Bringing in highly specialised skilled individuals with the intention of knowledge transfer to an internal team, can work very effectively. The key is to ensure that the roles and responsibilities of all parties are clearly defined with outcomes well documented and, of course, sufficient budget to do so.
Start building a strong internal capability today
If you are looking for some advice on how and when to start building internal capabilities, or you are interested in finding out how a centre of excellence could be beneficial to you, get in touch. We would be happy to have a conversation about what this could look like for you.