The coronavirus pandemic of 2020 is wreaking havoc on ERP and HCM implementations across the globe. Some companies continue to be opportunistic and strategic in their transformation initiatives, but most are experiencing changes to their planned approach.
The world has experienced a tectonic shift in terms of health, the economy, societal norms, and other aspects of life. These changes will inevitably upend ERP and HCM transformations across the globe. At the time I write this, our team and I have had conversations with over 40 client organizations in the weeks since the worldwide pandemic shutdown, and the impacts to transformation teams are starting to come into focus.
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Why do we need to restructure our ERP or HCM implementation project?
Some organizations have slowed down their projects to redirect resources to accommodate surges in demand, while others have slowed down due to revenue shortfalls, budget cuts, and general uncertainty. Regardless of the reason, most organizations are facing a massive transformation – whether they planned to change or not.
As the dust settles and the economic impacts become more apparent, many project teams will find the need to reorganize their ERP or HCM implementation projects. This will be a necessary step to survival, recovery, and adaptation in the new realities of the 2020. Project teams are experiencing unprecedented change, which requires new ways of thinking and approaching transformation.
We recently offered 10 recommendations for ERP and HCM implementation teams in a post-coronavirus world. Taking this one step further, there are a number of things that you should be doing to restructure your transformation project in a way that is conditioned for the realities of the 2020s. Below are the highest-priority things you can be doing now to start down that path.
Restructure your future state business process improvements
One of the highest-priority first steps is to restructure your business process management. There is a high likelihood that your business processes may have very well been built for 2019, but not for the 2020s.
For example, a supply chain management transformation might be necessary to fix procurement and logistics issues exposed during the pandemic. Or, your human capital management processes might be highly inefficient and ineffective for dealing with the health and talent attrition issues of the 2020s. Whatever the case, you will want to restructure how your businesses should be improved to condition for our new realities.
Restructure your ERP and HCM software investments and commitments
Our clients and prospective clients we have spoken with recently tend to fall into one of three categories:
- Those that have paused or scaled back their ERP or HCM implementations due to uncertainty,
- Those that are realizing that the weaknesses of their operating models have been exposed during today’s rapid pace of change, or
- Those that have healthy balance sheets and/or private equity funding and are reinvesting idle capacity and dollars into a new ERP or HCM implementation.
If you fit into any one of these categories – especially #1 or #2 – it is important that we not take a “transformation as usual” approach. Those outdated ways of investing in big-dollar technologies and systems integrators were leading to too many ERP failures to begin with. These changing times are a great reason to start questioning, prioritizing, and restructuring where you invest in new technologies, and just as importantly, where you shouldn’t.
Now is a once-in-a-lifetime event (hopefully) that requires “force majeure” type thinking. If you have overspent on software or systems integration services, now is the time to renegotiate your way out of it. If you are about to invest in new ERP or HCM software, be sure to recognize that you have more leverage now than you probably ever will. I don’t recall another time in my career where enterprise software buyers have been so clearly in the driver’s seat.
More than anything, now is the time to recognize that technology may help you out of this current situation. However, simpler and less expensive business process improvements, new strategies, and organizational changes could potentially deliver more value without the cost and risk. Don’t forget that technology is just one of the many levers you have in your arsenal as you navigate these turbulent waters.
Rethink your organizational change management strategy and plan
Every single one of us is dealing with change at a breakneck speed. It wasn’t that long ago that most of us were healthy and moving and working freely. Now, we have quickly adjusted to a world where commerce, social activity, and general movement can be brought to a grinding halt within a matter of days.
In addition, we now face a professional work environment with unprecedented change, fear, and uncertainty. In addition to worrying about health in the workplace, employees need to consider new processes, the fact that their business models have changed, or that it is highly likely that they or their peers may be without jobs during this global economic recession.
With that in mind, your change strategy and plan is likely outdated and needs to be revisited. I recently wrote about how organizational change management is dead, but old-school ways of change management are even more a relic of the past. We will need to go well beyond PROSCI certification to manage change in the future.
Implement a strong implementation quality assurance framework
Risk mitigation is one of the most valuable currencies for organizations and their ERP or HCM implementation teams. Technology will remain important to transformations, but more focus and resources will need to shift to risk mitigation to ensure that transformation efforts don’t get out of control.
If the fox is guarding the henhouse – or in other words, your big ERP systems integrator is managing everything on your project – you are likely overpaying and exposing your company to too much risk. In order to be successful, restructure your project governance to enable a third-party and independent ERP and HCM consulting firm to oversee the project and enable quality assurance.
With limited resources and smaller margins of error, organizations need to stop handing blank checks to their systems integrator. This recent article about SAP S/4HANA project quality assurance can be applied to other types of ERP and HCM implementations as well. This sort of project quality assurance should be a key component as you restructure your transformation project.
Redefine your ERP and HCM implementation strategy and plan
Just as the world has changed around us, so has our ERP or HCM implementation requirements. After you have considered the above restructuring strategies, it is time to rebuild a plan that is built for the 2020s.
Throw “best practices” and other cookie-cutter approaches out the window. This is a new era, so generic and ineffective strategies of the past are even more irrelevant today. It is more important to define a new implementation plan that reflects where you are and where you are headed as an organization.
Feel free to contact me if you would like to brainstorm ideas on how to navigate your ERP or HCM implementation. Creative, independent, and unbiased thinking is what we all need right now, so I am happy to be an informal sounding board as you define next steps on your transformation journey!
