Five Key OCM Challenges with ERP Implementations
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1 Five Key OCM Challenges with ERP Implementations Hosted by: Eric Kimberling President, Panorama Consulting Group Cliff Simms Director, Organizational Change Management Copyright 2010 Panorama Consulting Group All Rights Reserved
2 Agenda Brief Introduction to Panorama Consulting Purpose of this Webinar ERP Implementation CSFs Five Common OCM Challenges OCM Tools to Mitigate the Challenges Questions and Answers
3 Introductions Eric Kimberling, President Founder of Panorama Consulting Former PricewaterhouseCoopers senior consultant 15+ years of ERP selection, implementation, and organizational change management expertise Cliff Simms, Director of ERP Organizational Change 30+ years in business process and systems consulting Deep expertise in manufacturing and distribution business Familiarity with high-growth businesses Former Partner and Regional Director at Andersen Consulting
4 About Panorama Consulting Niche consulting firm with critical mass in the ERP market Experience with 150+ ERP packages We Provide Three Primary Offerings: ERP Software Evaluation and Selection ERP Implementation Project Management ERP Organizational Change Management and Benefits Realization Depth in targeted industries, including manufacturing, distribution, supply chain, and high-growth companies ERP Vendor Independent and Neutral
5 Some of Our Clients
6 Broad and Deep ERP Expertise
7 Agenda Brief Introduction to Panorama Consulting Purpose of this Webinar ERP Implementation CSFs Five Common OCM Challenges OCM Tools to Mitigate the Challenges Questions and Answers
8 Purpose of This Webinar To compare the benchmarks from ERP projects that succeed vs. from those that fail To discuss ERP Implementation CSFs (Critical Success Factors), especially in OCM To discuss five common OCM challenges To recommend OCM tools and approaches to deal with these challenges
9 OCM Definition Organizational Change Management supports and compliments the project management team as they focus on the technical implementation of the ERP solution The OCM team assesses, plans and directs actions designed to ensure a successful human interface during and after the ERP project The human interface includes system users and non-users It includes both internal and external constituents It includes training, communications, evaluation, development, reporting and any other investment in human capital
10 Guiding Philosophy Software does not deliver benefits or performance improvements people do OCM is therefore not optional on an ERP project, it is an integral Critical Success Factor (CSF) The orientation of OCM is toward people The foundation principles for effective OCM are alignment and accountability
11 Agenda Brief Introduction to Panorama Consulting Purpose of this Webinar ERP Implementation CSFs Five Common OCM Challenges OCM Tools to Mitigate the Challenges Questions and Answers
12 Top Reasons for ERP Failures Lack of purpose for implementing ERP Not going into the project with eyes wide open Lack of executive and management buy-in Not leveraging the A-Team from the business Not choosing software that is aligned with the business and key requirements Misalignment between software configuration and business processes/workflows Lack of effective OCM and training Weak internal and external project management Underdeveloped business case to manage business benefits Items in blue are directly or indirectly mitigated by an effective ERP OCM methodology
13 Despite Benefits, ERP Can Be Challenging Three-year study of over 1,600 ERP implementations across the globe Full report available at:
14 Why the Need For ERP OCM ERP typically affects an entire organization, no matter how large or small the company As a result of ERP, end users are often overwhelmed with changes to their jobs, including: A new system to perform their day-to-day jobs New processes and way of doing business More exposure to and interaction with new business processes and data People cannot embrace what they don t understand. OCM addresses this through communication. Need to balance between the need for OCM and: Appropriate timing for messages (e.g. layoffs) Working within the constraints of budget, time/duration, people, etc.
15 Why the Need For ERP OCM Employees about to migrate to ERP need to be presented with information and knowledge to ease the transition More than just training them how to use ERP In addition to system training, employees also need to understand: Why the organization is switching to ERP How and when ERP will affect their jobs How ERP will improve their jobs (what s in it for me?) How ERP will make the overall company more effective
16 OCM CSFs Truth Full Disclosure Open Dissent Alignment Goal Alignment Action Coordination Accountability R&R Clarity Consequences Engagement Participation Priority Leadership In Fact and Appearance
17 Agenda Brief Introduction to Panorama Consulting Purpose of this Webinar ERP Implementation CSFs Five Common OCM Challenges OCM Tools to Mitigate the Challenges Questions and Answers
18 Five Common OCM Challenges 1. The Conspiracy of Silence 2. We Go-live When?!?! 3. Time to Process 4. Bottlenecks 5. Walking the Talk
19 Five Common OCM Challenges Challenges No open dissent The Conspiracy of Silence Hostile withholding of information Passive aggression or covert resistance Procrastination and/or continuous crisis as cultural norms Mitigation Strategies Look for the origin Create a safe place to share Identify the sources and try to turn them Confront resistance and deal with it Consequences for non-participation
20 Five Common OCM Challenges We Go-live When?!?! Challenges Limited time to accomplish essential OCM tasks Not enough time to do it right (plenty of time to do it over) Flexing scope rather than go-live date Mitigation Strategies Resolve competing priorities Do critical path planning Prepare and follow testing scripts Have a Plan B
21 Five Common OCM Challenges Time to Process Challenges Late, incomplete, inadequate communication with the organization No time to process No time to respond Loss of confidence and engagement Mitigation Strategies Communicate early and often Promote inbound communication; 1-on-1s, stand up/town hall meetings Respond to feedback LISTEN, LISTEN, LISTEN
22 Five Common OCM Challenges Bottlenecks Challenges Single group of multipurpose resources Pinch points in the process Consolidating power and control, losing quality and efficiency Mitigation Strategies Separate technical and OCM core teams Segregate and articulate responsibilities Position OCM in an integral, helping role
23 Five Common OCM Challenges Walking the Talk Challenges Communicating priorities and following through Sheltering core team resources Resolving competing priorities Mitigation Strategies Look for an excuse to reinforce the message Make the hard choices Remember that a picture is worth a thousand words, so is a decision
24 Agenda Brief Introduction to Panorama Consulting Purpose of this Webinar ERP Implementation CSFs Five Common OCM Challenges OCM Tools to Mitigate the Challenges Questions and Answers
25 OCM Tools The Conspiracy of Silence Organizational Readiness Assessments Online Surveys Focus Groups 1-on-1s We Go-live When?!?! Change Impact Assessment (CIA) Training Needs Analysis (TNA)
26 OCM Tools Time to Process Communication Plan OCM Charter Bottlenecks RACI Chart (Responsible, Accountable, Consulted, Informed) OCM Charter Walking the Talk Milestones & Metrics Charts
27 OCM Tools Diagnostic Tools Development Tools Organizational Readiness Assessments OCM Charter Change Impact Assessment Communication Plan Process Change Matrix Training Needs Analysis Proficiency Testing RACI Chart (Responsible, Accountable, Consult, Inform) Milestones & Metrics Chart
28
29 OCM Work Streams Marketing & Communications Change Impact / Organization Design Training Risk Assessment / Organizational Readiness Benefits Realization Knowledge Transfer
30 Work Stream Deliverables Marketing & Communication! Change Impact / Org. Design! Training! Risk Assessment / Org. Readiness! Benefits Realization! Knowledge Transfer!
31 Summary of Lessons Learned OCM can be the difference between success and failure on an ERP project OCM can deliver on-going benefits to organizations, both for ERP and creating culture change It is important to keep your eyes (and ears) wide open during the process Independent and external expertise can support the technical implementation and help avoid some of the common OCM pitfalls
32 Agenda Brief Introduction to Panorama Consulting Purpose of this Webinar ERP Implementation CSFs Five Common OCM Challenges OCM Tools to Mitigate the Challenges Questions and Answers
33 Questions? Our Next Webcast: Tips for Selecting the Right ERP Software For Your Organization Thursday, Sept. 30, :00 a.m. MDT
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