ERP Consultants: The Go-It-Alone Scare Tactic
Let’s face it. ERP is a multi-billion dollar industry dominated by software vendors and consulting firms. This is not going to change anytime soon since software is the necessity of any ERP implementation. But, for an employee within a company responsible for a project and an organization that must “live” with the outcomes, the question is: Who solely has your best interest in mind? I can say only one thing: The deck is clearly stacked against you.
This is why smart organizations are taking on more project responsibility by developing or acquiring the ERP and software knowledge previously provided by outside consultants. Like anything else, this approach is not for everyone. However, many organizations are now performing more than just their traditional project roles, and for good reasons.
Often, these same companies once bought into the paternalistic consultants will take care of us mindset, were burned, and vowed never to do it the same way again. Other companies have heard the ERP horror stories, such as the company down the street that just went 100% over budget and had little to show for it (even when using the “cure all” oversight of an independent consultant).
Many companies have realized that doing more of the work internally, along with a solid plan to do it, breeds more ownership and involvement from all levels within the organizations. This not only reduces implementation costs, but just as important, enables better business solutions (with fewer outside consultants). Finally, it puts companies in a position to sustain the business changes and support the new system after go-live (once the consultants walk out the door).
Rest assured. The best employees within your company understand the business processes and issues better than anyone does. After all, they perform the processes and deal with the issues every day. Collectively, they usually have many very good ideas of how to improve the processes. The key is, you need to listen to them and tab into this vast knowledge base!
Of course, no one is predicting or advocating that consultants drop off the face of the earth. But who would argue with the fact that an engaged organization (that is ready and willing to do more, and has more knowledge of the software) has a much greater chance for success? The problem is most vendors have no real interest in explaining to their clients how to take more ownership or have no comprehensive plan to actually make it happen.
Overcome the Fear Mongering
On the other hand, there is always the argument that most organizations simply do not have enough resources or the right skills to staff the project. The premise is the implementation will not be done incorrectly, will take longer, and benefits will never materialize. While agreed there are exceptions, but repeated here are key points discussed in greater detail in my book.
- Most organizations actually have enough internal resources (if they look),
- Most organizations already have many of the right internal skills-sets and/or the foundational skills to develop (if they try),
- Many organizations can hire new employees with the software skills (this approach to project staffing is more easily cost justified than most people think).
My experience has been it is normally not a question of how far an organization can take this approach, but how far they want to take it. In most organizations, when sr. management wants something to happen, they find ways to free-up or acquire the right employees for the job. In fact, this is the first sign of management commitment to anything!
Does Anyone Really “Go It Alone”?
In the meantime, mostly for self-serving purposes, ERP vendors and implementation service providers continue to speak from both sides of their mouth when it comes to the client ownership question.
For example, after a project goes down the tubes, vendors often cite “lack of client ownership” as reason behind it. Yet, at the same time, when a client has a desire to do more of the project work internally, from the very beginning most vendors discourage the idea, calling it the go-it-alone mentality, casting ominous doubt and fear.
However, in this case, rarely does any organization truly go it alone. Instead, the company uses outside consultants a lot less and closely manages those they do use. And why not? Managing expensive resources effectively, no matter where come from, only makes good business sense.
It is a “Do-It-Yourself Project”
CIO Magazine published the first mainstream article I read acknowledging this approach back in 2002. Written by Christopher Koch (now the Editorial Director at SAP), the title is: “CIOs Take Back Control of Enterprise Projects from Consultants”.
In this article, on CIO.com, Mr. Koch points out that many CIOs have decided to do most of the ERP project work internally because, given the nature of the ERP consulting industry, they believe they have no other choice (if they want to be successful).
Actually, the concept of putting ownership in the right place has been around from the very beginning, but somehow has been lost in the ERP industry hype. Thomas F. Wallace, an earlier pioneer of MRPII/ERP, said it best in his book, ERP: Making It Happen:
It’s a do-it-yourself project. Successful implementations are done internally. In other words, virtually all of the work involved must be done by the company’s own people. The responsibility can’t be turned over to outsiders, such as consultants or software suppliers. That’s been tried repeatedly, and hasn’t worked well at all.
Consultants can have a real role in providing expertise but only company people know the company well enough and have the authority to change how things are done.
When implementation responsibility is de-coupled from operational responsibility, who can be legitimately accountable for results? If results aren’t forthcoming, the implementers can claim the users aren’t operating it properly, while the users can say that it wasn’t implemented correctly.
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Steven Phillips is an ERP professional with over 27 years of implementation experience. He is the author of the book “Control Your ERP Destiny”, one of the best-selling ERP titles. The book is available at Amazon, Google Play, Apple iBooks, Barnes & Noble, Kobo and through many other international booksellers.