InformationWeek
Defining The Business Value Of Technology
August 2, 1999
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Companies aren't just trying to keep applications simpler, based on their experiences with ERP. They're also avoiding the big-bang approach to enterprise software: an all-at-once implementation meant to instantly transform the business.
Such an approach, typical in ERP projects, has kept IT departments wrapped up in implementations for years, as they waited for each application piece to fall in place before launching the whole thing. Savvy companies now approach an enterprise software implementation as a series of steps in a modular process; this not only makes it less daunting and more manageable, but also lets the business derive immediate benefit from high-return applications such as procurement packages.
Southworth Products recently wrapped up an all-at-once implementation of Cymex International's ERP software, because the company felt that its 17-year-old legacy systems wouldn't work with the ERP package. But Southworth plans to phase in its implementation of Pivotal's Relationship CRM package. "There's already enough change occurring as a result of this," says IS manager Hitchcox. "Do we really want our users to go cold turkey on everything?" The phased approach will let a small group of users become familiar with the Pivotal product before it's extended to the rest of the business.
Step By Step
The gradual successes helped win support for the rest of the project. As a result, General Instrument will implement its supply-chain and front-office initiatives gradually, too--working first on a forecasting piece, then phasing in E-commerce links with supply partners and global capacity planning. "Anything we do in the future, we'll bite off small chunks and deliver incremental value," says McCarthy.
The difficulty of implementing ERP software has led some businesses to more closely examine the technology issues involved with the applications they purchase. Hash of CCC Information Services says that when his company purchased Lawson's ERP software, it focused primarily on the business processes the suite offered and missed the complexity of the platform and integration issues. So when it selected Vantive for its CRM software, he says, "we were looking at the products below the promise." The company wanted a software program that could be relatively easily to implement and customize.
Some businesses say ERP has taught them to scale back their dependence on consultants, a mainstay of ERP implementations. Itron Inc., a Spokane, Wash., maker of meter-reading devices for the utilities industry, says it depended on consultants when it implemented the first financial modules of its J.D. Edwards application suite.
The consultants did a good job with the project, says CIO Tony Praza, but when it was over, Itron had few people on staff who knew enough about the software to do upgrades or add new applications. "Utilizing consultants is a good idea, but having them do all the work is bad," Praza says. "All of the knowledge leaves." For its current CRM implementation--J.D. Edwards' call-center application--Itron used only one consultant; the bulk of the work is being done in-house.
That's a dangerous rationalization, argues Cambridge's Sherman, who feels companies often exaggerate how unique their customer processes actually are. "Folks believe the way they sell is different from the way other people sell," Sherman says. "But there's enough similarity across the way people sell that businesses ought to leave [the software] alone."
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A phased implementation also can generate good will with business executives and users who might otherwise fail to see the benefit of an enterprise application suite. General Instrument experimented with a phased approach in its most recent ERP implementation, building four or five prototypes of various parts of the system. The company implemented financials and manufacturing first, then went on to order entry.
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