Q&A: How to Ensure Your ERP Project Goes Smoothly

  • by David Hannon, Contributing Editor
  • August 16, 2011
Management
Find out which areas of an ERP implementation are the biggest roadblocks to an on-time and on-budget project and get tips on how to best structure your own project.

With many companies loosening the IT purse strings, enterprise IT projects are on the rise. According to the latest forecast from analyst firm Gartner Inc., spending on enterprise software worldwide is expected to increase by almost $20 billion this year to $255 billion. Even more pronounced is the increase in spending on IT services, expected to top out at $824 billion.

Every company that sets off on a new enterprise deployment wants its project to go off without a hitch — but that doesn’t always happen. To find out what aspects of an ERP project bring the most risk for sending a project off track, we recently talked with Pat Phelan, a research vice president at Gartner Inc. with expertise in ERP implementations and project risk management. Following are the highlights of that conversation.

Do you see ERP projects increasing in 2011?

Yes, we’re seeing a lot of interest in ERP projects right now. The budget seems to be there, and we’re seeing some fairly substantial projects, both globally as well as in the US. I wouldn’t call it a renewed interest, because I don’t think the interest ever really waned, but we’re definitely seeing more budget being allocated to ERP projects.

In which areas of ERP implementations do companies most often shortcut their due diligence?

There are several areas I’d point to. First is the amount of time and budget the companies dedicate to implementation services. Companies spend a significant amount for the software itself, and then go on to spend from three to 10 times that amount on implementation services. But often they don’t spend enough time selecting the right systems integrator or don’t budget properly for the services involved. Even if you have the best software in the world, if you have the wrong team put together to implement what you bought, or underestimate how much the implementation process may cost, the project will suffer.


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