Just a few weeks ago, we were consulting to clients and writing about self-actualization and optimization digital strategies we recommend for ERP and HCM implementations in the 2020s. In light of current events that have transpired since then, many of those strategies are already becoming obsolete.
What a difference just a few weeks can make.
While the fundamentals of ERP implementation best practices have not changed, the prioritization and the way they are applied are completely different today. This is forcing us to think about new ways of leading and managing digital transformation, HCM, and ERP implementations in general.
In some cases, technology has nothing to do with the new approaches. Instead, our needs for the future are more about business operations – and more importantly, people. We outline these and other keys to navigating this post-COVID-19 world in this recent video:
Below are some recommendations that you should keep in mind as you navigate this new reality that we are facing.
How every organization in the world is being forced into a business or digital transformation
We expect to see more companies and teams that are expected to work smarter (and harder too, by the way), while also being selective with limited resources. This is because most organizations tend to fall into one or more of three categories:
- Those that are severely disrupted by employee health concerns, remote workforces, lost productivity, and employee personal issues spilling into the workplace
- Those that are forced to shed human capital due to an economic downturn and decreased customer demand
- Those that are experiencing unprecedented surges in customer demand due to the industries they are in, such as food, grocery, consumer staples, healthcare, government, defense, and others
Nearly every organization falls into category #1, but there is a great divide between the companies that fall into either categories #2 and #3. Those that fall into category #2 are being forced to redesign their organizations, increase customer demand, find new sources of growth, and fight for their overall survival. Those in category #3 are being forced to rebuild their organizations, technologies, and processes to keep up with unprecedented customer demands and overall change.
In many ways, each and every organization in the world is being forced into a business or digital transformation of some sort – whether they like it or not. Many will require new technologies to support this evolution. Others will focus on lower hanging fruit such as organizational and human capital improvements or business process management and optimization. No matter what the right solution, most will undergo a people, process, and/or technology transformation of some sort in the coming months and years.
It is important to be smart about your ERP implementation plan, cost, and risk
More than ever, companies are being forced to be smarter about their ERP implementation plans and costs. We are already seeing a dramatic shift in the risk tolerances of organizations that are either about to begin a transformation or are already in the midst of one.
Having lived through the great recessions of 2001 and 2008, I remember that both led to much smarter spending than when organizations were facing good times. More recently in 2019, organizations were riding a high and were feeling overconfident while carelessly managing their transformations, which was already leading to an increasing number of ERP failures. Now, companies will have no choice but to be smarter with their investments and priorities.
Given the increasing intolerance for risk, organizations are demanding better project management and quality assurance than in days of past. They are going to be implementing tighter governance and controls. They are going to have less tolerance for lack of value or accountability. They will no longer keep an open checkbook for their big ERP systems integrators.
In some cases, companies will scale back their technology investments. They will be less likely to sign on the dotted line for a big, fat, cloud ERP software contract that locks them into higher operating costs in the future. They will focus more on improving their operations and organization and less on half-baked technologies that have questionable business value.
Instead, they will view technology as simply an enabler. Those that are experiencing surges in demand will focus only on technologies that help them better manage that problem. Those with severe workforce disruptions may focus more on HCM systems to help better handle the workloads. Those with declining consumer demand may focus more on technologies that help drive top-line technology growth. But the companies willing to go all-in on one big ERP implementation or digital transformation will be fewer and further between.
If there is a silver lining in the world in which we are living, it is that it is forcing companies to be smarter about how they manage their transformations. I would argue that companies should have been doing this all along, so perhaps this is a good reminder of how important this best practice really is.
The human capital and organizational change paradigm has shifted
I have always been a proponent of organizational change management. I began my career as a big 5 SAP change consultant for ERP implementations at large companies, so it is something that is near and dear to my heart. You could say that if I have one bias, it is that I lean heavily into change management as a highly effective transformation strategy.
In current times, I suspect that most will find the need to double-down on the value of organizational change management (but the effective kind rather than the traditional kind that fails). People’s personal and work lives are being disrupted in ways that most of us have never seen, which means that strong leadership, communications, alignment, empathy, and guidance are going to be more important than ever.
It also means that organizations are going to have to manage their human capital better than they have in the past. This is partially because people are dealing with a lot of stuff right now. It is likely going to test the limits of HR departments, employees, and processes. But it is also because companies are either dealing with reorganizations, layoffs, and/or surges in hiring demand.
Never has human capital and organizational change management been as important as it is right now.
Key takeaway: the times they are-a-changing
We are entering unchartered territory. I have yet to meet a single person who has seen anything like this in their lives. But I have confidence in organizations and their leaders to navigate the storm and lead their organizations to safety and opportunity.
The key is to drop our old ways of thinking and embrace this new reality.
Please feel free to contact me if you are unsure of how to navigate these realities. I am happy to be an informal sounding board as you determine your best path forward based on where you are at the moment!