Why you should start your ERP journey with a strong coffee and OCM.

A whole lotta changin’ going on

If you’re about to start an ERP software implementation, you’ve already done the hard yards to establish the right application and vendor, and to understand the business benefits you can expect, and the upcoming journey to go-live day. So, we’re not going to talk about that.  

What we are going to discuss is the importance of making sure that the changes you’re about to make by adopting new, transformative technology are going to be palatable to your users. That chaos and user resistance won’t undermine all of the hard work and investment that goes into a major ERP implementation project, and that the business will realise an ROI sooner than later. 

Once upon a time (way back in 2015), you could reasonably expect 70% of all transformation initiatives to fail. But since then, that well-known McKinsey & Company statistic has been downgraded by Gartner to around 50%. While that’s a considerable improvement, success is still not a ‘sure thing’, with only 34% of change initiatives being defined by organisations as a clear success, and 16% sitting on the fence - unable or unwilling to classify their project as an obvious failure or success.  

The cost of failure is high. As an initiative to change drags on, the cost to your organisation grows. When the finish line is a moving goalpost, it takes more time, effort, and resources to achieve a clear ‘win’. And as the project go-live date fails to materialise, users become impatient (and exhausted) and will inevitably find workarounds – basically defeating the purpose of improving technology.  

By comparison, the cost of success is considerably more cheering. A 2018 report by Hubspot says that 95% of businesses that adopt an ERP record improved performance with their processes. And a 2019 study shows that 82% of enterprises who move to an ERP will achieve a positive ROI on schedule (which, on average, is within 2.5 years). 

So, the payoff for ERP implementation success is well worth the effort. But what is the critical lynchpin of success?

You can’t fake success

You’re probably more than familiar with the proverb: You can lead a horse to water, but you can’t make it drink. And likewise, if your users fail to adopt your new ERP application, it’s hard to turn the tide of rejection post-implementation, and even more challenging to realise a positive ROI within an expected timeframe.  

So, how do you make change palatable and possible? Answer: OCM (Organisational Change Management).  

While that all sounds great, what matters more is the proof behind the rhetoric. So, here goes: 

If we look to Prosci, a globally acclaimed leader in change management, and their ‘An Introduction to Change Management’ paper, they say that initiatives with excellent change management are six times more likely to meet objectives than those with poor change management. Further to that, they report that 79% of the executives and senior leaders they surveyed recognise the value of change management in their organisations.  

If you’d like more stats, Prosci also reports that with OCM, your organisations will be: 

• 6x more likely to achieve your project objectives 
• 5x more likely to stay on or ahead of your schedule 
• 2x more likely to stay on or under your budget 

All of which is pretty compelling evidence that OCM makes a critical contribution to the success of an ERP implementation. The three main areas that affect user adoption effectiveness are: 

1. Learner readiness 
2. Design 
3. Organisational alignment 

And when all three areas of learning transfer are addressed, user adoption training effectiveness can be enhanced by as much as 186%.

Tricks of the ERP trade:

While OCM is the logical way to improve ERP implementation success, it comes with some caveats and recommendations. So, here’s what NOT to do.

• Underselling the implementation sizzle. Announcing a change initiative without a compelling backstory is never advisable. If users feel they’ve been blindsided, and can’t see any ‘what’s in it for me’ outcomes, they’re unlikely to buy into the whole project. But by establishing the shortcomings of your current system, and generating excitement about the benefits of change (eliminating manual data entry, discarding spreadsheets, at a touch reporting, real-time data, anywhere-anytime access on the go, in-built workflows, and more), you’ll generate far greater levels of user acceptance and enthusiasm.  
• Not getting stakeholder buy-in. Diving into a major change initiative without first considering the impact on your stakeholders can be a costly mistake. Even the best-laid plans can be undermined if those executing it simply don’t understand or appreciate the benefits of change. Good leadership traditionally comes from the top and motivates everyone involved to come along on the journey.   
• Taking a shortsighted view of training and resources. Embedding a change initiative without the adequate training and resources pre- and post-go-live places unrealistic expectations on your users. Not only do they need to navigate the shock of change, but they also need time to understand and learn (and work through their fear of the unknown) at their own pace and style. Appreciating the need for a range of training initiatives will improve your chances of the transformation being embraced and enjoyed by everyone. A good rule of thumb is to have 90% of your people adequately trained pre-go-live. 

Change management goes well beyond helping your people adopt a new set of behaviours in line with your change initiative. It includes preparing your people for imminent and ongoing changes, helping them deal with ambiguity, and openly embracing the opportunity for growth. 

5 top tips for a successful change initiative

Having suggested what you should never do, it’s only fair that we now share our top five tips for ERP implementation success using OCM.  

1. Understand your starting point. Start with a health check to establish where your people are now (at the beginning), as well as identifying what’s needed to bring them along on the business’s change journey.  
2. Appoint your champions of change! While a top-down buy-in is always effective, a bottom-up approach to change can be just as effective.  
3. Draw up a communications plan. Take a human-centred design (HCD) approach to compiling a matrix for who you need to communicate with, how you need to talk to them, and how often.
4. Be prepared to tweak your change plan. Change is constant and often unpredictable. So, understand your change model and be ready to adjust your communications for each stage along the change journey for key stakeholder segments. 
5. Bring in the experts. OCM is a formal discipline honed by real-life experience. So, unless you have someone that meets that criterion internally, don’t ask for a show of hands. Sadly, willingness doesn’t equate to ability. Instead, engage with an experienced OCM partner who understands that your people learn in diverse ways and at different paces, can help you avoid unnecessary anxiety, increase the speed and rate of uptake, and ensure your employees aren’t seeking alternative workarounds. 

But don’t take our word for it, here’s a testimonial from a recent case study on how the AFL utilised our OCM practice to their advantage. 

"Fusion5’s OCM support and guidance throughout the project was invaluable. They ensured that our change management piece was well planned and thought through from the outset. And it gave me the support of an experienced change manager to complement my skills, learn from, bounce ideas off, and validate strategies with.” 

– AFL Change Manager