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Change management’s crucial role in ERP implementation

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Change is a constant in the business world, and nowhere is this truer than in the implementation of Enterprise Resource Planning (ERP) systems. ERP implementations represent a significant shift for organisations, touching the very core of their operations. From altering daily workflows to reshaping established processes, its impact is extensive.

As epic ERP MD, Stuart Scanlon, says, “Implementing an ERP system is like performing open-heart surgery on a patient who is walking around and interacting with his/her environment. You simply cannot shut an entire company down in order to implement it. The company has to remain operational with as little disruption as possible.”

Effective change management is, therefore, key for success.

ERP implementations activate a torrent of change within an organisation, which often leaves employees feeling uneasy. To address the challenges and fears surrounding these changes, you need to adopt a well-defined approach to change management. It is crucial that top management provide ongoing support and adopt a proactive stance toward change to avoid ERP implementation failures.

Change is a process, not an event. Firms must adopt a structured framework when implementing change in their organisations. Drawing from Dr John Kotter’s Eight Stages of Change Management theory (1995), we have put together a comprehensive approach to help guide organisations through the often-disruptive process of ERP transformation.

Kotter’s eight stages of change management

1. Create a sense of urgency

  • Conduct ROI analysis to underscore the tangible benefits. (See our previous article “Unlocking the ROI of an ERP system”.)
  • Identify opportunities, including non-traditional benefits through structural changes and Key Performance Indicator (KPI) reporting.

2. Form a powerful guiding coalition

  • Establish a leadership coalition capable of steering the change.
  • Drive the implementation by maintaining focus on the urgency and opportunities that form part of the transformation.

3. Create a vision

  • Develop a compelling vision of the future state, highlighting the benefits of the change.
  • Formulate strategies to realise the envisioned change.

4. Communicate the vision

  • Tailor communication methods to the organisational culture.
  • Set behaviour standards through effective messaging, shaping the organisation’s attitude toward the project.

5. Empower others to act on the vision

  • Identify and eliminate barriers to change.
  • Encourage inputs and critiques on the future vision.

6. Plan for and create short-term wins

  • Align employee rewards with the change process.
  • Celebrate small achievements as steps toward larger change goals.

7. Consolidate improvements and produce more change

  • Boldly adjust systems, structures and policies as the partnership gains support.
  • Hire and promote individuals who can actively contribute to implementing the vision.
  • Introduce new projects supporting the future vision.

8. Institutionalise new approaches

  • Integrate change into the organisational culture.
  • Establish leadership succession that upholds the future vision and embodies the change culture.

Change management stands as a cornerstone in the success of ERP implementations. A clear strategy and vision, communicated effectively from the executive team to every employee, form the foundation for success. Linking remuneration to change efforts provides a tangible incentive for employees resistant to change.

Beyond the realm of ERP projects, fostering a culture of change positions an organisation to adapt swiftly to external shifts, creating a more resilient and agile entity in our ever-evolving world. Over and above our software offering, epic ERP can help you across your business with all the change management aspects associated with your ERP implementation. Contact us today to find out how.

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