ERP replacement is not just an IT project

Who runs an ERP project Business Transformation

ERP replacement is not just an IT project

ERP replacement is often considered to be an IT project. This makes sense. After all, it’s the IT department that must handle and resolve the challenges caused by an outdated system. They know the daily toll it takes firsthand- both on the workforce and on the company itself.

Once the need for a new ERP system has been identified, who in the company should be expected to manage the project itself? Many argue that it is an IT project, and therefore IT should run it.

There is just one problem with that perspective: an ERP replacement or modernization is never just an IT project.

ERP projects touch every facet of your company. No department is left unaffected, and technology requirements are only one factor. Your business processes and how your people work must be taken into consideration from day one if you are going to successfully identify and modernize your company now and for the future. If these pieces aren’t in place at the beginning, there will be some hard realizations farther into the project as key considerations come out that were not previously identified. This will impact the cost, timeline, and even the success of your replacement.

The only path to success is through working with this fact, not against it. Turning your ERP replacement over to your IT department is a recipe for failure. This is not because they aren’t highly capable professionals. I would venture that, as with most IT departments, you have highly talented and skilled individuals. They need to be able to focus on their strengths and continue bringing value to the company. ERP replacement is a very specialized and intensive undertaking. While the IT director and their department need to be actively involved throughout the project, ERP projects take a different skill set than the regular demands of the IT department. It is unfair and unrealistic to expect them to become an expert overnight in something that requires years of knowledge and experience to master.

An ERP project will require hands-on involvement from the leadership team, the IT department, and other key stakeholders. Managing this project overall, from its inception, to developing a business case with the right goals and strategy, to the right roadmap, and then on to selection, negotiations, and implementation takes specialized knowledge. It also takes deep and wide experience and a lot of time. No one really has the time to stop everything else to become a specialist in the ERP industry. Even if they did, it would take years to get there.

One other point to consider: If you put your IT director in the position of running the project, they lose their ability to be a member of the team needed to analyze the process. It will be difficult to gain consensus in this role if the team feels like the IT department is pushing their own agenda. When the IT director is a member of the team, they can serve as a voice to offer valuable input.

This is why consulting firms can bring value to an ERP project. A good consultant will bring that deep and wide experience to ensure you are taking the right things into consideration, involving the right people and departments when needed, and allowing your employees to focus on their primary jobs the rest of the time. Consultants will work with your IT department and other key people to help the project succeed. A good consultant will get your project completed successfully with significantly more value and significantly less wasted time.

Overall, the IT director and their department is clearly vital to the success of your ERP. But help them be successful by supplementing their deep insight into your company with professionals who have deep insight into the industry.

David Warford
David Warford
Co-Founder, Managing Partner , KnowledgePath Consulting, Inc.
As co-Founder and Managing Partner at KnowledgePath Consulting, Inc. David applies his 30+ years of experience in the technology industry, exceptional leadership skills, and his commitment to honesty and transparency to ensuring client success. He drives customer relationships that span the globe in numerous industries and product categories.