ERP CULTURAL IMPLEMENTATION ISSUES:-

Implementing an ERP causes massive change that needs to be carefully managed to reap the benefits of an ERP solution. Critical issues that must be carefully considered to ensure successful implementation include fundamental issues, organizational change process, people, and implementation cost and time and employee morale. The pertinent issues are:

Fundamental Issues

Implementation of an ERP system can be long, costly, and labor-intensive and can affect an organization's bottom line if done incorrectly. To ensure the success of any ERP implementation project, a project team consisting of an ERP consultant, internal auditing, and IT staff familiar with the company's business operations should be established and their role must be defined.

(a) Role of Manager

Managers must consider the fundamental issues of system integration by analyzing the organization’s vision and corporate objectives.

●      Does management fully understand its current business processes, and can it make implementation decisions in a timely manner?

●      Is management ready to undertake drastic business process reengineering efforts to yield dramatic outcomes?

●      Is management ready to make any changes in the structure, operations, and cultural environment to accommodate the options configured in the ERP system?

●      Is the organization financially and economically prepared to invest heavily in an ERP implementation?

(b) Role of an Auditor

Auditors play a proactive role in helping the organization laying the foundation for an initiative's success with their knowledge of internal control practices, compliance requirements, and business processes. In particular, internal auditors can:

●      Document abbreviations and their function.

●      Identify documents used in the organization's daily operations.

●      Compile a list of the organization's master data sets.

●      List the internal controls that are applied and adopted during each business process stage.

●      Create a list of currently used and recently generated management information reports.

(c) Top Management Commitment

Management needs to exploit future communication and computing technology issues in order to integrate the ERP system with e-business applications in their organization to decide on the key related implementation and business issues. Due to enormous impact on the competitive advantage of the company, top management must consider the strategic implications of implementing an ERP solution keeping in mind the size of the company and the modules installed. Management must ask several questions before embarking on project.

●      Does the ERP system strengthen the company's competitive position? How might it erode the company's competitive position?

●      How does ERP affect the organizational structure and the culture? What is the scope of the ERP implementation -- only a few functional units or the entire organization?

●      Are there any alternatives that meet the company's needs better than an ERP system?

●      If it is a multinational corporation, the management should be concerned about whether it would be better to roll the system out globally or restrict it to certain regional units?