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5 Reason your SAP Implementations can Fail
Introduction:
The promise of ERP to unleash a wave of efficiency by reducing manual processes and enhanced business reporting has made it an enterprise staple.
SAP, one of the world’s leading ERP solutions, has modules that can automate almost every aspect of an organization’s business processes – from the shop floor to the supply chain, from HR to Accounts, and everything else in between. Whether it is the ease of reporting, increased efficiency, reduced costs, enhanced data security, or scalability, SAP helps organizations become more agile and responsive in an increasingly complex and competitive global economy.
While ERP has significant advantages, implementation failures end up giving it a bad name.
To make sure that the implementation is seamless and successful, here are some of the common mistakes which cause failures of SAP implementations.
Treating SAP implementation as an IT project
Treating an SAP implementation as an IT project is one of the most common mistakes that lead to implementation failure. Given the scale at which an SAP implementation occurs and the business impact, treating an SAP implementation as an IT project is a recipe for disaster.
It is essential to understand that while SAP implementations cannot be led like an IT project by the IT department in a silo. Instead, they have to consider the business goals and organizational objectives, consider the impact of the process on the business to create an effective implementation roadmap that unifies the entire business seamlessly.
Lack of SAP Technology Expertise
While there are many ERP vendors, not all are equal in the SAP universe. Many times, SAP implementations fail due to the lack of SAP expertise especially when organizations are looking for customized SAP solutions.
SAP experts have exhaustive knowledge and skills, implementation experience, and the maturity to avoid technology complexity and associated challenges – especially as organizations transition from legacy ERP that has a different architecture.
SAP expertise is also essential as organizations can only get the real value out of SAP implementation when it is powered by newer features like analytics. With insights across the different operational, strategic, and financial areas, organizations can make better decisions, optimize their infrastructure, enhance automation avenues, and improve customer engagement. Experience to nail down and eliminate redundant data is also an essential part of SAP implementation. This removes data redundancy and enables smooth and timely data migration and powers the analytics engine. However, this can become a complex and inefficient process in the absence of SAP expertise.
SAP experts also can help organizations build the right customizations and make sure that the customizations do not impede the performance, scalability, and maintainability of the implementation. SAP experts ensure that they create a robust business blueprint that aligns business needs to the right SAP model correctly to deliver timely and tangible business results.
Poor Domain Knowledge
As mentioned, SAP implementation is a business project and not an IT project. As such, having robust domain expertise is imperative for a smooth implementation. Given the rising complexity across industries having a deep understanding of the domain helps in designing optimized implementation strategies.
It is essential to have a deep understanding of the business to make educated decisions on what to automate, which processes to eliminate, which processes to augment, and which ones to prioritize for their ROI impact.
SAP knowledge also has to be backed up with the understanding of multiple systems at play to create a robust integration blueprint and drive better decision-making. Domain expertise is of critical importance when building customizations as it helps in determining the kind of customizations the business needs, how much should be customized, and whether work can be conducted easily using existing functionalities without any customizations. The lack of the same thereof can lead to incorrect decisions and eventually SAP implementation failure.
In the FMCG sector, for example, it is important to have a clear understanding of both the enterprise side and the sourcing, production, distribution, and supply chain side to create the right workflows and to automate the right processes to deliver value. Given the complexity of finance and accounting in this industry, it is essential to have a clear understanding of the finance and accounting processes to correctly integrate technology capabilities to eliminate redundant work. Lack of domain knowledge of this industry can lead to poor choices that impact implementation efficiency.
Lack of integration with other systems
Organizations today are dependent on a multitude of business applications and processes. Managing these applications and processes in silos leads to more conflict and puts a drain on time and resources especially as the organization expands. Failure to integrate SAP with other systems then impacts business agility. Optimizing workflows and streamlining processes becomes challenging in the absence of a single version of the truth.
Lack of integration also leads to a greater reliance on time-consuming and error-prone manual processes that can lead to data inaccuracies, impact collaboration, and consequently, business revenue.
Thus, for SAP implementation to be successful, it is imperative to build meaningful connections between both SAP and non-SAP systems and applications. For this to happen, your SAP implementation partner needs a deep understanding of the SAP ecosystem, domain knowledge, and experience of large-scale SAP implementations.
Insufficient Focus on Support and Change Management
Migrating business processes to SAP is not a cakewalk. And even the best designed and the most seamless implementations can go wrong in the absence of the right support and change management strategies.
This is an important aspect to consider since businesses function in a fluid world today. The market is extremely dynamic and competition is fierce. As such, all SAP users have to be trained to adapt to the change brought about by the implementation.
Ensuring the organization receives the right go-live support to help businesses own and execute business processes is essential. SAP implementation also does not end after the go-live. It is essential for organizations to conduct a post-implementation audit to evaluate if the SAP implementation meets all the set goals and objectives. Thus, having a post-implementation business process and application audits become important activities. These activities evaluate the avenues for process optimization, identify competency gaps to suggest training and better process understanding, and optimize SAP system configuration using the right technologies to get the most out of the system.
It is also imperative to have a robust change management strategy in place to secure buy-in from all the users and help them adapt to the new system faster. Setting up effective communication channels and helping users understand the benefits of the implementation go a long way to foster adoption. It is also essential to make executive buy-in a part of the change management strategy to build a coalition of executive support to motivate the workforce.
Ensuring SAP Success
Relying on technology to solve a business problem is only a part of the solution. To get the best results in SAP implementation, it is imperative to have a robust project plan, a clear business blueprint, and a defined delivery and implementation strategy that accounts for all the moving parts of the complex business and organizational landscape.
Selecting the right SAP implementation partner thus assumes paramount importance for SAP success.
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