The fact of the matter is that change is hard, and the difficulty of change involved in any ERP or HCM implementation takes time. Forget about cloud solutions, easy-to-use user interfaces, “no training” software, and other industry clichés – ERP and HCM software is the relatively easy part of a transformation. The change itself is difficult.
Why ERP and HCM implementations take longer than planned
So why is this such a challenge? It comes down to industry dynamics, biases and incentives. ERP vendors and systems integrators have a lot to lose by having a slow or unfavorable decision that doesn’t allow them to close the sale. But you and your team are the ones that have to live with those decisions for years to come – long after the vendor sales reps and system integrator consultants are gone.
- ERP and HCM software reps and their systems integrators are incentivized to sell rather than properly manage expectations.
- Their perfect world assumptions rarely materialize as planned.
- They typically lack the experience to know how long your implementation will really take.
- They typically don’t account for critical and time-consuming activities outside of their purview of expertise, such as organizational change management and data migration – two activities that are common culprits of time overruns.
- When in doubt, they will typically err on the side of overly-optimistic assumptions that won’t jeopardize the sale or kicking off the project sooner rather than later.
In addition, people often assume that change resistance won’t be particularly difficult. One of my recent YouTube videos discusses this fallacy and how to mitigate this common blind spot:
How to properly estimate ERP and HCM implementation time
In order to properly and more accurately estimate our implementation time, we need to run ERP vendor proposals through a sort of sanity filter. We need to account for the missing components, fix faulty assumptions, and tailor their boilerplate sales materials to fit who we are as an organization.
To start, our 2020 ERP and HCM Report reveals that the average implementation duration is roughly 18 months. The problem is that most of us are not average. Some of us are bigger, more complex, less sophisticated, or less willing to change than others. Each fiber of our DNA somehow contributes to how long our transformation will really take.
For example, a vendor or systems integrator may assume that you have a certain minimum level of internal maturity and sophistication. But perhaps your people have been on the same green-screen system and spreadsheets for 30 years. In this case, your implementation will likely and inherently take much longer than a company that is using a slightly more modern ERP system from 10 years ago.
Or perhaps your internal operations are a mess. You have grown rapidly through acquisitions over the years and are operating as a bunch of siloed and different entities. If your goal is to standardize operations, your transformation will undoubtedly take longer than a company that has already standardized its operations and is treating this implementation as more of an IT upgrade instead of a true business transformation.
Common factors that contribute to ERP and HCM implementation time and duration
In addition to the two examples mentioned above, there are a number of factors that need to be clearly defined as critical inputs into your ERP and HCM implementation plan and timeline. Most ERP vendors and systems integrators treat all companies equally or otherwise fail to consider these important variables, which vary from company to company. There are no one-size-fits all answers.
For example, here are some of the things that companies need to consider when developing their implementation plans and timelines:
- Magnitude of change. The bigger the change this project will mean for your company, the longer it will take.
- Number of locations. A higher number of locations requires more time to accommodate different operations.
- Number of countries. A higher number of countries in scope requires more time to accommodate different cultures.
- Complexity of your operations. The more complex and unique your operations, the longer it will take you to implement.
- Your internal competencies. The less implementation experience and capabilities your internal team has, the longer the project will likely take.
- Number of internal project resources. The less project resources you commit to the project, the longer it will generally take.
- Level of internal alignment. The less executive steering committee alignment as a group and with the digital transformation team, the more time will be required.
Each of these variables represent a continuum of options, with no one right answer. The key is to define where you are today, where you want to be in the future, and ensure that your internal team understands where you fall on the continuum. Then (and only then) can you use these as inputs to define a more accurate implementation timeline.
My recent YouTube video outlines how these and other variables should contribute to and help formulate your overall ERP and HCM implementation plan and duration:
The bottom line
The bottom line? ERP vendors and systems integrators have a lot to gain by encouraging a quick decision to buy and start deploying software. Reality gets lost in the shuffle and biases corrupt internal expectations. That’s how so many organizations begin with implementation strategies, plans, and timelines that were never realistic to begin with.
The key is to augment your vendors’ proposed plans with missing activities and translate their estimates into reality. Your reality, that is. Each company is different, so it is important that the plan and timeline be tailored to fit some of the unique aspects of your organization.
I am curious to hear your thoughts and questions regarding your development of an ERP or HCM implementation or timeline. Please contact me if you are looking for unbiased ways to improve your digital transformation, ERP or HCM implementation strategy and planning. I am happy to be a sounding board for you as you continue your journey!