Skipping Business Process Mapping (BPM) before an ERP Implementation is unnecessarily risky!
Sure ERP and Enterprise Software come with “Best Practices” baked in…but they are not a silver bullet!
In fact, they may not be best practices at all, they are simply the way each particular system works, sometimes efficient and an improvement on how you currently operate but others may be inefficient (e.g. what takes a user raising a Purchase Order 5 key strokes on a single screen currently will need to be done over 3 screens and take twice as long in the new system) and clearly a step backwards.
Despite our best efforts, and the efforts of other consultants, over 60% of organisations in Australia and New Zealand do not have their business processes documented. This statistic could actually be much higher as the survey included many large organisations and in our experience mid size companies almost always do not have their processes documented.
Many leaders and decision makers have fallen for the misguided belief, often espoused by software vendors to help sell their products quickly, that they should just adopt whatever ‘best practice’ processes the new system they are implementing comes with as standard. Whilst this is a good guiding principal, enterprise solutions are flexible and have many different ways they can be set-up, requiring decisions to be made about the optimum way for your business. Obviously it is preferable to have done some thinking on how you’d like to operate in the future and gained consensus from your subject matter experts so you can bring this to the table and discuss with your implementation partner.
The other objective or guiding principal we hear at every client is that they want to ‘go vanilla’, which means no customisation at all. According to empirical research done by independent consultants in the US – Panorama Consulting – over 90% of organisations modify their ERP solutions to some degree, despite saying the same thing, when they realise that the processes they are adopting don’t match their business needs at the detailed level, especially for the areas of the business that differentiate them to competitors.
The Risks you take when you skip Business Process Mapping
1. Buying and implementing an Enterprise Software Solution or ERP that is not the best-fit for your needs
Many organisations assume, or hope, that the secret to solving their organisation’s problems is to implement a new ERP or Enterprise Software solution. Furthermore, vendors are renowned for exploiting this misconception when selling solutions to potential buyers.
The truth is not all business issues are a result of an out dated ERP or Enterprise Solution. In fact, the underlying reason behind many business issues are inefficient, inconsistent processes, which may or may not be as a result of the systems currently in place.
ERP and Enterprise Software implementations are a substantial financial investment (Read the real cost of ERP), so the risk of implementing a system when it isn’t needed can be quite a costly mistake. Especially when a simple re-design of some processes using your current system might be enough to get the same improvements (see out article about upgrading vs replacing your System).
The best way to avoid this – and to understand what it is that is causing the pain points in your organisation at the detailed level consulting a wide array of users and stakeholders and potential improvement opportunities – is to map and analyse your existing processes and define could-be ways of working prior to selecting and implementing a system.
We have often been asked to help organisations justify their system choice and have found in some instances that the best course of action may have best been to not implement a new system at all.
There are hundreds of solutions available on the market and not having a clear view of how you’d like to operate (i.e. Could-Be processes) and your requirements will mean that you won’t have an idea of which one would be best for you. Our article “Why do BPM before Selection” covers the key reasons why BPM can mitigate against selecting the wrong solution
If you do not do BPM there is a very real chance that you will select a solution based on software salesman’s flashy high level demonstrations over functionality and you may select a solution that undermines the competitive advantages that your existing processes have provided you. This could lead to loses not just from paying for the implementation of an ERP/Enterprise Solution but also from losing revenue and loyalty from your customers.
There have been times when we have been called by disillusioned CIO’s to assist implementation projects after they have already selected a solution to find that they had missed BPM and consequently the solution they choose did not have all the functionality that they needed and that it fundamentally changed processes that were once a competitive advantage voiding any benefits gained from the selected system.
2. Missing opportunities for improvement
We have found that more often than not, when an organisation jumps straight into selection or implementation without understanding why they do what they do and what could possibly be changed to improve it, the solutions implemented work as just a new skin to an old process. This is one of the biggest issues with system implementations, spending big to get a system that does exactly the same thing as your old system in the exact same way.
Conducting a BPM exercise prior to selection and implementation, allows the organisation to critically analyse their existing processes and to ask the hard questions such as why do we do things the way we do and if we change it will it result in better operations or not? Funny enough, lots of organisations will opt to do a half BPM exercise and map their current processes for the very purpose of identifying pain points but then not develop could be processes believing the solutions that they implement will do that for them. This leads to the many of the other issues below.
3. Implement unnecessary customisations & apps that add limited value to your organisation
Having no idea of what processes are most critical to your business can have vendors identify other low hanging fruit and pressure you into additional add on software or customisations for functionality that may not actually be of any real value to your organisation. Without a baseline process to compare against, you are left open to their hype. When BPM is used in conjunction with a PAS, the risk of having bad partners and unneeded customisations and add-ons is greatly reduced (Read more about Planning and Scoping here).
4. Prolong internal decisions on how things should be done
If you have no expectations of what the future state holds you will most likely revert to the old way of working when you become overwhelmed with all the different ways consultant shows you their system could handle a process. Trust us, we have seen this happen. In the heat of the design sessions when an implementer shows you 5 or 6 different ways to do something, many subject matter experts will just explain how they currently do things and ask the consultant to do it that way, not realising the very reason that the system is being implemented is to improve that process.
This misalignment of expectations can lead to lengthy process discussions during the design stage of the implementation or during the planning and scoping phase of the project that can inevitably prolong the process and push out the budget as time is taken to come to an agreed way of working, the difference is at the stage you have already contracted the solution consultants and are paying for their time too.
To make the matter worse if you try to rush a decision on misaligned processes during the planning, scoping and design just to push a head and reduce the consulting costs, then there is an increased risk of resistance if the people who are impacted by the process change are not engaged (see the complexity of change management risk below).
This is the most likely of the risks to eventuate when BPMI is not done before selection and implementation and is the cause of many other pain points in the process.
5. Increase the scope and cost of the Software Implementation
If requirements are missed or decisions on how a process should be done are only taking place after the selection of the system, then there is a very high probability that the scope of the implementation will change. This is because proposed solution may need additional customisations or tweaks to meet the needs that arise later into the project or you spend more time designing processes than you expected.
6. Make change management initiatives more difficult to tailor to individual’s need
An Enterprise Software Solution or ERP is useless if it isn’t used correctly by the end users. This is why change management is so important (Read our guide to Change Management here). Business Process mapping assists with mitigating against the risk of having resistant stakeholders in a couple of ways.
Firstly, the process of understanding why an organisation works the way it does and how it should in the future is a highly collaborative one. It engages key stakeholders in order to identify the pain points and improvement opportunities. This provides these individuals with a sense of ownership of the change process right from the onset. If missed there is a very high chance that users will feel that new ways of working are forced on them and will blame the system for this, reducing the use of the system and the adoption of the new process. In fact, we have witnessed that a lack of proper engagement in BPM can have people resist new processes to the point of finding work arounds because they do not have an understanding of why things are changing and how it impacts them.
Secondly, without mapping processes out the identification of key changes and impacted stakeholder groups is made increasingly difficult for the change management team. This is because BPM highlights the roles, activities and systems involved in changing processes and allows messages to be tailored to the end users. Not being able to identify the impacted groups and tailoring messages to them increases the risk of having inefficient change management initiatives and misaligned messages.
7. Missing required system integrations
It’s becoming increasingly rare to find organisations that operate on just one Enterprise Software or ERP solution, rather organisations tend to have multiple solutions linked and even if they do have a single system, it will likely still need to be linked to supplier systems or customer portals in one way or another. That is why the integration of new solutions with existing solutions is critical for the success of implementation projects. Unfortunately, there is a high risk of missing integration points if BPM is not conducted correctly.
We have heard of some instances where clients have missed critical integrations because they have not mapped out their processes end to end, to find that weeks before go live that the solution works perfectly in isolation but cannot work properly because the integration was missed.
8. Increased difficulty explaining processes for testing and training
Without mapping out “to-be” processes it becomes increasingly difficult to monitor and explain processes for testing, typically there are multiple ways in which a user can perform a task in a solution and you want to monitor that the most common processes work perfectly before flicking the go live switch.
Similarly, without having processes defined and mapped out explaining the accepted organisation standard process during training is impossible (see change management point above).
9. Not achieve a culture of continuous improvement after the ERP project
Finally, as stated in our BPM articles earlier this month, the number one benefit for BPM is consistent and efficient processes that can be monitored, baselined and continuously improved. Missing out BPM removes your ability to effectively implement a continuous improvement program post implementation. Look out for our next BPM article expanding on the need for continuous improvement in organisations.
The SM Approach to BPM – Let us Map out your way on the Road to ERP Success
This is why at Solution Minds our experienced Consultants follow a robust BPMI methodology and approach to map out and analyse your current processes to understand, document and agree upon issues and opportunities for improvement, provide recommendations for possible future state processes and advise on the next steps required for system selection.
Want to know more…
Director – Solution Minds
Mob: +61 400 729 559