Every enterprise resource planning (ERP) implementation I've been aware of starts with a mantra that ‘we are going to implement vanilla.' However, months down the track and millions spent, some vivid flavours of vanilla emerge - some very successful, some less so. So how do you make the decisions on where vanilla is right, and how do you make those decisions stick?
The lure and economics of utilising ERP Products (SAP, Oracle etc.) to replace legacy complex estates have long been understood and adopted widely across most sectors. And it is perfectly true that over the last ten years and more there have been many highly successful ERP implementations, from medium-sized single-site companies up to major government departments and indeed global rollouts at some of the world's largest multinationals.
Yet we continue to see very much less successful ERP projects - ones that deliver disappointing (sometimes even disastrous) results - despite huge amounts of time, expertise and money spent on them. Why is this? The reasons can be varied and complex, but in many cases they reflect one or more basic errors in the implementation plan. However they are all related to that key, vital concept of ‘vanilla' ERP. That is, using the out-of-the-box ERP product without the excessive customisation that is always difficult, time-consuming and expensive - and usually unnecessary when one balances the high configurability of all today's ERP offerings against the real information needs of any given business.
Having understood and accepted the extreme desirability of vanilla ERP, why do so many CIOs find it so hard to achieve? In my view there are three basic mistakes that are made time and again.
First, there is the important issue of leadership. For successful change management you must engage with the people whose activities you want to change. With vanilla ERP you are immediately limiting the amount of choice you have in shaping the solution, so the challenge is more difficult. In these circumstances user engagement needs a strong leader - one who can articulate how simplicity and standardisation support and enhance business value. It also takes strong leadership to drive decisions that optimise the whole when some out-of-the-box processes contain noticeable but not material compromises.
Second, people fail to distinguish between those business processes and information that are core to their business model and those that, when analysed objectively, are essentially of an essentially ‘standard' nature. For the former, you may have no option but to pursue a degree of customisation, as they are the things that distinguish you from your competitors or support your fundamental policy objectives. But for the latter, it is well worth changing your business processes to match the vanilla version of your chosen ERP product, not vice versa. And that will usually mean overcoming resistance from those who wish to continue using the old processes simply because they are familiar with them.
Third, people underestimate the sheer scope of an ERP programme. They see it as a technology implementation that only needs a partner with technical knowledge, and fail to appreciate that it is essentially a business transformation requiring strong change management skills. Such a partner is fine for businesses that have such skills in-house, but many don't. And the record shows expertise in business change within the programme team is important for any successful ERP implementation, and indispensable for a vanilla implementation. Such expertise can come by co-opting existing staff onto the ERP team, or by hiring new people, or by working with external implementation partners - ones with both change management and technology skills.
Whichever route is chosen, the ERP team must be able to but a business face on ‘vanilla ERP best practice' to get past resistance from those mid-level business staff who have difficulty separating what they do today from true business requirements.
The good news is that all three problems I have outlined are eminently soluble. Indeed the solutions are obvious - provided you are aware of them. But for those who do understand the need for strong leadership, the difference between core and non-core processes, and the fact that ERP means business change not just technology change, the benefits and rewards can be huge. A vanilla ERP solution is something with a powerful positive impact at bottom-line level. But its deployment must be properly conceived and implemented, using the best practices that have become clear from the hundreds of successful projects now on record in all economic sectors and all parts of the world.