Comments are closed. Previous Article Next Article It all began back in the early 1990s when the large consultancies startedoffering industrial giants the promise of huge efficiency savings. Their proposal was ‘business process re-engineering’. Hoards of consultantswere deployed across operating units armed with benchmarked statistics on ‘leadingcompanies’ and those dreaded ratios – 1:100 finance/employee, 1:150HR/employees, etc. To deliver these benchmark savings, corporations had to invest millions, notonly in consultancy and change management fees, but in complex IT – EnterpriseResource Planning (ERP) systems. The prize was set, the business case writtenand the figures delighted the chief finance officer. Back came the consultantsin their droves to help the implementation. But why did ERPs fail? First, not many organisations had the necessary skills to implement suchlarge-scale change programmes, they used costly external resources frommanagement consultancies and IT vendors. Knowledge transfer was non-existentleading to two major problems, a solution based on an IT product and a lack ofskills to fully sustain the change. Second, with the scale of investment in technology, it was normal to see asenior IT manager leading the project. Again this lead to an IT based solution.And finally, there was a lack of buy-in by middle management, fuelled bycultural resistance to common processes and organisational change. So where did that leave the hundreds of organisations that tried to deliverefficiencies through ERP? The business case often anticipated a significant reduction in headcount,but a lack of fundamental process and organisational change across manybusinesses meant they weren’t delivered. Millions were wasted on consultancy fees and complex IT systems, withover-functionality driving projects over budget. And organisations were seducedinto allowing the development of a highly customised IT solution, creating acontinuous over-reliance on expensive IT support, maintenance and upgrades. So why have so many of us followed this trend over the years? Is it peerpressure, have we been led by finance or do we just follow the trends? In the current climate, this level of IT spend without measurable resultscannot be sustained. Also, the internal customer wants far more from HR thanthese ERPs can deliver. Don’t let ERP stand for Eat Revenue & Profit. You have to get theimplementation right if you are going to achieve sustainable results. HR must start with a clear understanding of what services internal customersrequire; it needs to streamline the processes across the organisation to ensurea common approach; it needs to re-organise the HR teams utilising a sharedservices approach; and it needs to implement appropriate technology as anenabler to the service provision. In the right hands this will deliver far morethan just e-HR. By Alan Bailey, Head of HR business process outsourcing XChanging IT needs to be sensibly managed to be usefulOn 11 Mar 2003 in Personnel Today Related posts:No related photos.