What Is Change Management and Why Is It Important for ERP Implementation? Part 1

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ERP (Enterprise Resource Planning) implementation is a big project for any company. It will affect your company now and for years to come. You can't afford to get it wrong. Successful ERP implementation is not an accident; it takes careful planning and well-proven methods. When ERP implementations go wrong, it represents a considerable waste of time and resources, and it's usually a failure of change management.

Change management is a collective term for all approaches used to prepare, support, and help individuals, teams, and organizations make organizational changes. Changes may be necessary because of business growth and expansion or the ongoing evolution of technology.

How can you ensure successful change management during an ERP implementation and reap a successful solution that will add value to your business?

Symptoms of faulty change management

Managing significant changes in your business environment is an art as well as a skill. Looking at the reasons why technology implementations fail, we notice some common contributing factors:

  • Employees are asked to change too much, too rapidly, and they become overwhelmed.
  • Decisions are handed down without consultation and feedback from the people who will be using the new technology every day.
  • Management assumes that communication is the same as engagement – it isn't.
  • Managers focus on changing processes and systems but fail to consider the way employees work, what they believe about the technology, and how it will affect their jobs.
  • Insufficient information is provided as the project progresses. Stakeholders may not understand timelines, expectations, and what participation will be required of them.
  • The IT department may believe that they own the project and fail to account for and support the day-to-day challenges that arise after going live.
  • Siloed work efforts are still in place because there was no confirming agreement across departments.

Poor change management is to blame for all of these difficulties. Improve your change management, and you will increase your chances for a successful implementation.  Effective change management watches for any "red-flag" issues and nips them in the bud. It guards against scope and time creep and keeps an eye on quality issues. Risk is reduced when players have a deep knowledge of the business, the right staff is involved, and surprises are kept to a minimum.

The problems come when change management is overlooked. It is against our instincts as humans to change because change is typically uncomfortable, so it is imperative to have a solid plan in place for effective change management and, ultimately, a successful implementation.

Change can be uncomfortable yet beneficial

Yes, change can be uncomfortable; it's against our instincts. But it's essential to remind yourself and your team that when change is done right, for the right reasons, it can be a game-changer for your entire organization. Help everyone in the company understand how the proposed changes can benefit them personally.  Your management team has the responsibility to mitigate resistance to change. Without complete adoption or employee buy-in, you will fail to maximize the potential of your new technology.  ​

On the other hand, resistance to change is not all bad.   A little pushback can be healthy for your management team as it forces them to choose their battles carefully. They'll have to consider the changes they are introducing and be ready to back up their decisions. That encourages good planning, communication, and awareness of the needs of the entire organization.

Now that we've established the importance of effective change management, let's talk about some strategies for achieving it. In part 2 of this topic, we'll present eight tips for effective change management.

Meanwhile, if you're getting ready to implement a Microsoft Dynamics 365 Business Central ERP system, learn more about business process analysis, then contact the change management experts at ArcherPoint for help on how to get started on the right foot.

By ArcherPoint, archerpoint.com



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