ERP implementations must happen gradually. Changing everything at once doesn’t work. Additionally, good follow-up in the form of project management and training of your employees is crucial. Dany De Budt has more than 41 years of experience with large data and technology companies. He explains his vision on ERP implementations, which pitfalls occur, and why a phased approach greatly increases the chances of success.
Enterprise Resource Planning (ERP) plays an important role in the digitalization of companies. Yet, almost half of all ERP implementations fail. According to Dany De Budt, Managing Director at Priority Software, this is due to several reasons.
He has his own vision on ERP that goes against that of the major ERP players. “Organizations are not ready to change everything. That’s why we adapt our ERP solutions to existing business processes, instead of the other way around.”
Phased Approach
Many companies still opt for a ‘Big Bang’ implementation, where the entire system is changed at once. This often leads to problems. “Gartner figures show that about 45 percent of global ERP implementations fail,” says De Budt. “This is because companies underestimate the impact of such a change.”
Priority Software therefore opts for a step-by-step approach. First, the system is aligned with existing processes, then further optimization is considered. “After six months to a year, customers see where improvements are possible and we can take the next steps together.”
This way of working prevents employees from being unable to cope with sudden changes. “Just last week I was with a client who wanted to change everything at once and now, twelve months later, he’s stuck,” says De Budt. “His organization wasn’t ready to change both the company and the processes and the implementation at the same time.”
Flexibility is Crucial
De Budt notes that companies often evaluate ERP solutions after six to twelve months. “In that initial period, customers discover what can be more efficient and what can be better automated. Then we move on to the next phase together.”
However, flexibility doesn’t mean that anything goes. “If a customer sees that everything is possible, there’s a risk that they’ll keep adding new wishes along the way, which can lead to delays and exceeding budgets,” warns De Budt. A strict delineation of requirements, clear priorities, and good project management are therefore crucial for a successful implementation.
The Role of Change Management
An ERP implementation means more than just new software. It’s a continuous change process. This means that companies not only look at the implementation itself, but also at the impact on employees. Training and guidance are needed to integrate that change into their daily work routine. “A successful ERP implementation stands or falls with how well employees accept and use the new way of working.”
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That’s why it’s best for organizations to involve employees in the process as early as possible. Clear communication helps to remove uncertainties and clarify the benefits of the new software. De Budt: “It’s often underestimated, but employees often feel threatened. They think: my task is being automated, what’s left for me?”
A phased implementation helps here too: employees can get used to the changes and have time to adapt. “It’s often better to provide a workable solution first, and expand it step by step.”
Future Vision
ERP systems have a lifespan of ten to fifteen years. This means that software suppliers not only need to respond to current needs, but also need to look to the future. “This is not short-term thinking, we always look ahead and long-term,” says De Budt.
AI plays an increasingly supportive role in this. “AI doesn’t replace anything, but adds efficiency. For example, our support teams use AI to identify and solve problems faster.”
In addition, De Budt sees a trend towards SaaS solutions. “Our releases are issued three times a year. This means that customers always have access to the latest improvements without massive updates.”
The Pitfalls of ERP Projects
De Budt often sees the same mistakes recurring in ERP implementations. One of the biggest pitfalls is the lack of a clear project leader. “Too often, the CFO is appointed as project manager, while they already have a full-time job. An ERP implementation requires someone who can fully focus on this.”
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Additionally, excessively high expectations or changing business circumstances, such as acquisitions, can delay or complicate projects. “That’s why we always opt for a flexible approach and work with the client to determine which adjustments can best be implemented and when.”
Conclusion
An ERP implementation requires a strategic approach. “By working in phases, being flexible, and involving your employees from the start, you increase the chances of success,” De Budt concludes. Change management is an essential part of a successful implementation, as is a full-time project leader. Everything must run smoothly at all times, otherwise things can quickly go wrong.
A flexible and future-oriented ERP system can help companies grow. “But only if it’s implemented correctly. An ERP is not a one-time investment; it’s a long-term collaboration.”