How to Manage Your First Digital Transformation or ERP Implementation Project

Written By: Eric Kimberling
Date: July 31, 2023

Working on a digital transformation team for the first time requires a lot of effort and can be overwhelming if it's your first experience. In this discussion, I will cover essential aspects that you should be aware of during your initial digital transformation journey.

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One of the common and intriguing observations we make with our clients is that many digital transformation leaders and project team members lack prior experience in transformations. They may only encounter such projects once every 10 or 20 years, if at all. The overwhelming majority of individuals we work with have never been through a transformation before. Therefore, today, I aim to share the essential information you need to know to effectively embark on a digital transformation journey.

Manage Internal Expectations

The first and arguably most important aspect to consider as a new digital transformation team member is learning to manage internal expectations. Often, external third-party forces may present visions that are unrealistic, and organizations may not fully grasp the challenges of digital transformations. When evaluating proposals from software vendors, assessing potential technologies, or defining implementation strategies, it is crucial to approach everything with a critical mindset and ask tough questions. Understanding what it will take to make the project successful for the organization and adding a dose of reality to the overall tech strategy is essential.

While this is easier said than done, especially for those new to digital transformations, seeking guidance from third-party independent benchmarks and resources can be beneficial. These sources can help develop a realistic plan and strategy for the organization, preventing disappointments among stakeholders. By managing expectations and educating stakeholders, we can avoid setting unrealistic goals.

Establish Program Management

When undergoing a digital transformation, it is extremely important to establish your own internal program management function for the project. In other words, you should not assume that the software vendor or technical implementer will handle the project management for you. Instead, it is crucial to set up the program and project management within your organization. After all, it is your internal team and organization that must take ownership and live with the outcome of the digital transformation or software implementation.

One of the first pieces of advice I can offer is that if you have a team or are part of one, you should not merely act as a support mechanism for an outside third party. Instead, you should create an internal Project Management Office (PMO) to manage these external parties. The reason this is so important is that it is the only way to ensure that your project remains on track and aligned with your organization's goals and objectives. It's essential to note that your organization and third-party software vendors and technical consultants often have conflicting priorities. Therefore, having a dedicated program management function will help align all parties involved in the project effectively.

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Focus on Change Management

Another crucial aspect to address during your first digital transformation is organizational change management—the human component of transformation. While I won't delve into all the details of establishing a change strategy and plan here, I have numerous videos on my YouTube channel that can guide you through the process. You can find a playlist dedicated to organizational change management, providing best practices to kickstart your change management journey.

The significance of change management lies in the fact that, as a project team member, one of the most critical contributions you can make to project success is addressing the human side of change. While technology plays an essential role, it is not as vital as the change management aspect. Ensure that you develop a clear change strategy and a comprehensive change management plan to tackle this crucial workstream within your digital transformation.

A significant cause of failure in digital transformations is a lack of internal alignment. In other words, headwinds arise when the internal organization is not on the same page regarding their transformation goals. Regardless of how well you manage the implementation, the lack of alignment can jeopardize the overall success of the transformation. Therefore, as a first-time digital transformation project team member, it is essential to facilitate internal alignment. Take your time to achieve this alignment before delving too deeply into the implementation process.

Often, organizations become overly excited about new technology and rush into the implementation without proper alignment. However, this approach may lead to long-term problems. Taking a step back, slowing down, and focusing on alignment will save time in the long run. It ensures everyone is on the same page and provides a clear sense of purpose, ultimately speeding up the process later on and saving exponentially more time than the effort put into achieving alignment.

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Listen to the Business

Finally, one of the most critical steps to ensure the success of your first digital transformation is actively listening to and understanding the business. It is essential to comprehend the business's operational needs and the current state of affairs, not just the future vision. Understanding how things work presently, why they operate that way, identifying pain points, and recognizing opportunities for improvement during the implementation process are vital.

You must also be aware of sources of resistance within the organization and be attentive to concerns and pushbacks. Maintaining a pulse on the organization and understanding its business and operational needs is essential. By doing so, you avoid the pitfall of simply deploying new technologies without considering the organization's context.

Technology and business must come together seamlessly, and this can only be achieved by actively listening to and understanding the business's requirements. This approach will help you bridge the gap between technology and business objectives effectively.

I hope this guidance provides you with valuable insights and ideas to focus on as you embark on your first digital transformation journey.

I would enjoy brainstorming ideas with you if you are looking to strategize an upcoming transformation or are looking at selecting an ERP system, so please feel free to contact me at eric.kimberling@thirdstage-consulting.com. I am happy to be a sounding board as you continue your digital transformation journey.

Be sure to download the newly released 2023 Digital Transformation Report to garner additional industry insight and project best practices.

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Eric Kimberling

Eric is known globally as a thought leader in the ERP consulting space. He has helped hundreds of high-profile enterprises worldwide with their technology initiatives, including Nucor Steel, Fisher and Paykel Healthcare, Kodak, Coors, Boeing, and Duke Energy. He has helped manage ERP implementations and reengineer global supply chains across the world.

Author:
Eric Kimberling
Eric is known globally as a thought leader in the ERP consulting space. He has helped hundreds of high-profile enterprises worldwide with their technology initiatives, including Nucor Steel, Fisher and Paykel Healthcare, Kodak, Coors, Boeing, and Duke Energy. He has helped manage ERP implementations and reengineer global supply chains across the world.
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