Making Enterprise Systems Work

While transplant patients are carefully monitored and checked, huge investments of corporate time, energy and money regularly fail through neglect

Published: Jul 2, 2010 08:24:56 AM IST
Updated: Jul 21, 2010 12:38:16 PM IST
Making Enterprise Systems Work
Prof. Oswaldo Lorenzo

Transplants are one of the great medical success stories of the last century.  The first heart transplant was carried out in 1967.  Since then the operation has become a regular occurrence. There were 33 heart transplants in the last year in Spain alone.  More than 80 percent of patients are alive one year after the operation.  Yet, the chances of rejection are high.  Large doses of immunosuppressant drugs are given to lower the risks. Patients are closely monitored.  In the first, year they often have 10 or 12 biopsies of heart muscle. Then they have regular angiograms to check against rejection.  Any changes in their health can have implications for their transplanted heart long after the operation.

In the corporate world the equivalent of transplants are regularly carried out.  Large scale Enterprise Systems (ESs), such as SAP and Oracle, are introduced at huge expense – typically anything from $1 million to $5 million.  But, often little effort is made to ensure that the new systems are accepted by the organization.  While transplant patients are carefully monitored and checked, huge investments of corporate time, energy and money regularly fail through neglect.

The reality in too many cases is that ESs promise much, but are expensive, complex, and threaten long-established relationships in organizations. Implementation is frequently fraught with difficulties. Change management costs mount as old systems are discarded or modified, staff are trained, old processes are set aside and new procedures adopted. In the early years, few ES implementations lived up to expectations; now, many organizations still continue to struggle to achieve the results expected and desired from ESs.

So how can and should organizations manage ES projects to minimize the risk of rejection and maximize the likeliehood of creating a healtheir organization?

1. Think of a long conversation not a quick chat
ESs are a slow and diligent learning process; a long conversation rather than a quick chat. It can take up to six years from the adoption of an ES project to reach the point at which organizations report that they have fully mastered the technology and processes.  Organizations need to place less emphasis on the technical and temporal aspects of ES projects and to view them as being part of a long journey led by users. Instead of implementing and interpreting projects as interrupting business as usual, continuous implementation, internal diffusion and assimilation of ESs should be considered the business norm. Software is no longer added to a business, but rather it forms part of its day-to-day operations, its flux and its consciousness, from the start.

This emphasis on a long conversation is a departure from the traditional implementation approach for ESs based on project management techniques and tools. Under this perspective the implementation of an ES is organized as a large-scale project with a beginning and an end. The project scope is clearly defined and limited, there are formal definitions, milestones and deliverables, monitoring and tracking of schedules and budgets are seen as critical, and the management of the project is led by a project champion.

My research over the last ten years provides an alternative model based on the reality that the multidimensional reality of an ES is not suited to conventional project management techniques.  It is far better to view implementation as an emergent learning process rather than a finite project.  In this approach there is often no single project champion or leader. Instead, local or decentralized leaders (i.e. key users) take responsibility for mastering the ES. Although multiple projects are continuously implemented, the overall ES experience is not managed as a single well-planned project. The purpose becomes the development of employees’ capabilities for learning, building and sharing knowledge, identifying new opportunities or solving mismatches.

Of course, project management is still important, but best practice should combine both implementation approaches. The entire ES experience should be planned to support the business strategy, while allowing key users to run an emergent process based on learning and sharing knowledge. The multiple initiatives that emerge from the learning process should be prioritized and approved by top managers, and carefully planned and implemented based on project management techniques.  This is the best way to implement an ES, balancing both purposes creating a deep and long-term learning experience and meeting short-term deliverables and results.

2. Social learning beats traditional training
Typically in a traditional ES project, consultants train the company’s people on how the system works. This takes place shortly before or after the system is installed. Once the system is up and running, additional training may be required. Consultants may come to the company when this training is needed or some ES vendors may offer support to give users training on the system at their desks. In addition, some consultants train the trainers. These are typically key users who then train others with similar jobs.  Throughout, the focus is on transferring system information and experience from consultants and vendors to the company’s employees.

Training is very relevant at the beginning of the emergent process because it is the first formal contact with the system. But, training is not enough to ensure the learning process through the long conversation. Users need to employ the system in daily work activities in order to master it and utilize it effectively. As a result, companies must ensure users learn properly and knowledge is created and shared.  Training must be integrated among the learning elements required to master an ES, but not as the single, dominant learning element.

3. A new take on leadership
In the traditional implementation approach, CEOs and top managers are considered critical to success because of their supporting role in the clear definition of the project scope, the provision of resources, the communication of the reasons behind and consequences of the system, the involvement of users and decision making.

In the long conversation model, CEOs and top managers should lead and create the means to facilitate the emergent learning process and monitor and control the multiple initiatives and projects which emerge. CEOs are in the best position to balance the dilemmas and challenges related to both allowing experimentation and meeting results.

Local experimentation and learning should be based on social networks within the company. In one company studied this was developed by keeping the key user’s committee up and running after the system was working. The group was then given a new role of creating and sharing knowledge resulting from use of the system; integrating areas or business units; and implementing new projects.

The role of the CEO is to support the formalization of these social networks and make them part of the mechanisms that manage the ES experience. The CEO should also personally participate in the social networks to ensure the development of new patterns of behavior by both general and key users – such as using the system, coaching others, taking full advantage of the system’s functionality and thinking of how to improve processes and the system use.  CEOs must also ensure the conversion of learning into new initiatives and projects. Then, these initiatives should be prioritized according to the business strategy and needs. Key users should manage the implementation of their initiatives and they should share the knowledge created with the rest of the key users participating in the social network.

4. Mastery more than implementation
In the traditional implementation of an ES, key users may determine how the system will affect their processes and activities, may recommend system configuration details, serve as “typical” users during testing the system, and may train others end users before the system is up and running. Unfortunately, in many implementations, once the project ends, key users are sent back to their previous jobs.

In the long conversation model, once the system is up and running, the most important task starts for key users: that of mastering the ES and then creating, sharing, and spreading the ES knowledge.
The role of the ES team should be the development of a social network in which key-users exchange knowledge and influence one another towards the mastery of the ES and the creation of new patterns of behavior. This network should be composed of the top-management and key users.

ES implementation is a long conversation driven by a desire for mastery rather than implementation.  It is an animated conversation involving many players and perspectives. Organizations redraw the boundaries of their ES projects and pursue learning, team-building and quality circles. It takes time, a great deal of time, but there is no doubt that organizations should not merely learn to live with ESs, but also employ it to achieve goals beyond those they set out to achieve.

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[This research paper has been reproduced with permission of the authors, professors of IE Business School, Spain]

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