Executive Summaries on Enterprise Apps© Number 3: The Executive’s Three Roles in Successful ERP Implementation

June 15, 2015
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As I’ve said before, an ERP implementation is a complex undertaking. One of the most critical success factors is an engaged and committed executive sponsor. While an engaged and committed executive sponsor won’t guarantee success, the lack of one will guarantee failure. Based on my experience over many, many ERP implementations, I’ve come to see that the executive sponsor has at least three critical roles:

  1. Defines the vision and provides active sponsorship
  2. Selects and supports the team
  3. Endorses the team’s decisions and makes timely decisions, when needed

 

Critical Role 1. Defines the vision and provides active sponsorship

An ERP implementation starts with top management recognizing that something fundamental in the company has to change. In Executive Summary number 2, “Three Reasons to Implement a New ERP System,” I define three categories of fundamental change that drive the need for a new ERP system.

               Improvements to profitability and/or cash flow,

               Solving problems with existing systems or lack of systems, and

               Improvements to on-going operations.

Whatever the decision driving the implementation of a new system, the executive sponsor has to define the vision the ERP system is undertaken to achieve.  The vision usually includes basic elements like:

The business strategy (the what)

The business case (the why)

The budget

The possibility of changes to organization structures, culture, and top level metrics.

The second part of this critical role, Active Sponsorship, is shown when the executive sponsor communicates the vision to the rest of the leadership team and then to the company at large. He or she must clearly state that this is important to the company. Active sponsorship is not approving the project, writing the check, and then walking away. It requires the executive sponsor to be visible in championing the project.

The executive sponsor starts the project on the road to success by clearly defining the vision and making sure the company knows the vision is important. That done, now the sponsor has to put the team in place that will implement that vision.

 

Critical Role 2. Selects and supports the team

After defining and communicating the vision, the next most important thing the executive sponsor can do is to  select the team leader. The choice of the team leader is an important signal to the company that the ERP implementation is important. The team leader should be a known and respected leader that the executive has full confidence in. The ERP team leader must be committed full time to the project and be fully empowered by executive leadership.

The ERP team leader defines who they need on the team, then documents each team member’s roles and responsibilities. The executive sponsor supports the team by approving the list of team members and helping to secure their release from normal duties for the duration of the project. The executive sponsor further supports the team by providing whatever training and team development is required to get the team started.

As the project moves through its various phases, the executive sponsor supports the team by being available to them. Often that availability is demonstrated by attendance at regular project status and issues meetings, or by ensuring that the ERP team leader can schedule time on the executive’s calendar when needed. Few things will delay a project more than lack of access to the executive sponsor.

 

Critical Role 3. Endorse the team’s decisions and makes timely decisions, when needed

During the course of any ERP implementation many conflicts and issues will arise, many decisions will have to be made, and many positions will be staked out. There will be differences of opinion on topics like what functionality to implement, what organization changes are required, and who should perform which business processes. The executive sponsor must help the ERP team by endorsing or declining to endorse decisions the team recommends. The executive sponsor should help the ERP team in their decision making by insisting on processes that ensures:

Decisions are made based on facts and data, not opinion and passion

Decisions are made in a timely manner and seldom changed

Decisions are documented  and communicated.

If the ERP team is unable to come to consensus on a decision or to get key stakeholder concurrence, the executive sponsor must be willing to make timely decisions to ensure the ultimate  success of the implementation.

Like I said in the beginning, an engaged and committed executive sponsor won’t guarantee success, but the lack of one will guarantee failure. ERP implementations are not quick, easy, or cheap. To have any chance of success the executive sponsor must continually refresh and reinforce the vision, visibly support the team as they work through issues, and ensure good quality and timely decisions.

To learn more details about how to ensure your ERP implementation project is successful, contact Doug Howardell at DH@theACAgroup.com or 626-836-9261

 

“Image courtesy of Stuart Miles/ FreeDigitalPhotos.net”

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