Digital transformation is a daunting task for any organization, and it can seem impossible to get things rolling without a solid strategy. You can also invest a tremendous amount of time, money, and energy, only to end up with a digital transformation failure. From digital transformations on small scale, like website upgrades and eCommerce deployments, to large-scale digital transformations that include an ERP implementation, your success hinges on maintaining a solid digital strategy from beginning to end.
As some of the most complex digital transformations, here are the five steps every organization can follow in order to give their ERP implementations the best chance of success.
When building a strategy for your digital transformation, executive alignment needs to be your first consideration. All too often, the C-suite thinks they’re all on the same page when in reality each executive could have varying priorities in what needs should take precedent in the transformation. A lack of a well-defined vision of transformation success leads the CIO to focus on optimizing cross-departmental communications and the COO to prioritize reducing labor costs. The CFO in this circumstance may have a different view of the impact of each on the bottom line. They all think they are doing what is necessary to drive success and they believe they are aligned in the end goal of a project, but even this slight misalignment can be enough to grind an ERP implementation to a halt.
Executive alignment should touch every office, employee, process, and end goal. It’s also important to bring the CEO into the decision-making process rather than letting the CIO spearhead digital strategy independently to ensure a cohesive and unified approach before diving into a transformation. By aligning the executives with a clear and specific digital strategy, you can set the bar high and give your implementation the best odds for success.
No one knows your business better than you. Once you have your strategy in place and executives in alignment, the next step is to consider your business needs. At this point, it’s important to know what problems need solving and which obstacles are preventing you from achieving your goals. By examining your current and future business needs and using them to drive your strategy, you avoid the common pitfall of thinking the ERP software itself will solve everything.
Consider software as a tool. It alone is not going to cut your costs, increase revenue, or ensure healthy profit margins. You must leverage the power of software to help you do those very things. Once you understand exactly what you need to do to achieve your goals and recognize software as a tool, not a crutch, you’re well on your way to success.
Research is a necessary evil when it comes to software selection. The number of choices available is staggering, and yet, the market keeps growing. These days, it’s not necessarily the wisest choice to select a software vendor based on name recognition or market share alone. Instead, it’s better to narrow down a pool of candidates and create a shortlist of vendors that can accommodate the needs of your organization — one whose offerings fit your specific goals and business needs the best.
This is a massive undertaking, but don’t panic. It’s easiest if you break it down into three phases:
Digital transformation is like a boxing match — everyone has a plan until they get punched in the mouth. ERP implementation happens in the real world, where things go wrong. The best way to build toward a successful implementation is to have a contingency plan. By predicting the risks you are most likely to encounter, you will be all the more prepared when things go sideways.
One risk in particular that likes to hide in organizations’ blind spots is organizational change management. Many companies spend tremendous time, money, and energy going through all the steps above, yet they don’t fully consider how things will operate when new software is live. Behavior is one of the hardest things to change. Unless your organization as a whole accepts the new strategy, technology, and processes actively and with open arms, the new ERP system that you just purchased is essentially good for nothing. The success of a digital transformation lies in the people that use the new technologies every day, and it’s important to account for the expected resistance that comes with any type of organizational change.
As the Director of Strategy and Transformation at Third Stage Consulting Group, I’m here to talk all things planning, research, and software. If you’re ready to talk shop about the best digital strategies and transformation tactics, please reach out to me directly. I’m always happy to start a discussion or brainstorm new ideas.