The #1 Mistake Public Sector Organizations Make When Implementing a New ERP System

Written by Guy Fowler, PMP

Replacing your financial, human resource, procurement or other mission-critical Enterprise Resource Planning (ERP) applications is a monumental undertaking, especially if you lead a public sector or education organization. According to GFOA and other industry experts you are much more likely to experience schedule delays and budget overruns than your counterparts in private sector. To achieve the benefits of moving to a Cloud-based ERP system, including streamlining your operational processes, generating more accurate and actionable data, and reducing costs, you need the support of a dedicated and experienced Project Manager. Without a project leader whose sole purpose is to ensure your success you risk your ERP project taking exponentially longer than planned, costing significantly more than budgeted, and at worst, failing and posing real risks to your employees, constituents and your career.

So why don’t all public sector business leaders acquire a proven Project Manager to lead their ERP implementations?

Below are some of the reasons given by decision makers to not select a professional Project Manager and why these assumptions are flawed:

  1. My assistant will manage the project.
    Often a business leader will choose a deputy or assistant to manage the project. While that person understands the organization, legacy application, and existing processes, they probably haven’t managed an ERP implementation before or been trained to use project management techniques. This inexperience often leads to missteps and delays and is one of the main reasons public sector ERP implementations fail. Additionally, the deputy who’s been given the new task of managing the project usually still has regular duties to perform. Almost always, either the critical ERP implementation project goes awry, or the assistant’s regular duties suffer.
  2. I’ll hire temporary staff to backfill my assistant so they can focus on managing the project.
    While hiring temporary staff to support your team during an ERP implementation project can help, they can never provide the leadership of an experienced Project Manager. Your most talented staff can add real value to the project by helping re-engineer your business processes, migrate data, test the new system and train other team members. However, staff must be directed. When and how to use subject matter experts is a skill Project Managers acquire through specific training and years of experience. Hiring temporary staff to back-fill key employees during this period, especially to perform tasks like data entry and data cleansing, will give them time to support this project. An experienced Project Manager will ensure the time they spend is not wasted.
  3. A project manager just adds another layer of bureaucracy
    Project Managers don’t add a layer of bureaucracy; in fact, just the opposite. A qualified Project Manager cuts through bureaucracy, holds people accountable, and acts as the single point of contact that team members and stakeholders need to knock down barriers. The sole purpose of a Project Manager is to bring the project to a successful conclusion by eliminating unnecessary processes that put it at risk or slow it down.
  4. An outside Project Manager won’t understand our systems, business, or processes.
    You hire a Project Manager to lead your organization in making significant system changes, not to manage legacy systems and processes. You want him or her to have experience implementing ERP systems, with background supporting financial or HR systems. Skills learned implementing modern ERP systems in other organizations are transferable to implementing your new ERP system. As you migrate from your legacy systems, your process will become more effective and efficient with the new system. A qualified Project Manager will learn what each of your staff or departments do and what organizational requirements there are for specific functions or transactions to ensure that these are carried over to the new system. Project Managers don’t need to be experts in legacy processes and systems that are going away.
  5. The vendor is managing the project.
    Vendors will provide project management functions for your ERP modernization effort. However, their ultimate allegiance is to the vendor, not to you. A vendor’s Project Manager has an inherent conflict of interest. Forced to choose between completing the project quickly and at minimal cost to the vendor, or doing the job right, the vendor’s Project Manager might choose the former. Hiring a Project Manager who reports to you, not the vendor, is the best way to prioritize your organization’s interests. Your Project Manager will ensure the vendor decides what’s best for your organization and lives up to promises made, including timelines and budgets. A Project Manager who works for you will challenge the vendor to maintain agreed upon timelines and budgets and allow you to gain maximum value from your new system.
  6. Project Management processes and principals are costly and unnecessary.
    When a business manager dismisses Project Management principles and techniques, the manager simply does not understand what Project Managers do. Just as your organization understands the necessity of hiring a trained and experienced accountant to manage your finances, business managers who’ve lived through successful technology modernization projects understand the value of a professional Project Manager. Using proven methodologies and rigorous processes to implement projects is the only way to ensure projects are completed on schedule and on budget while limiting risks and achieving the organization’s goals.

To understand what a professional Project Manager will do to support your ERP implementation, please see Part 2 of this article “8 Things Project Managers Do to Ensure Successful ERP Implementations”.

If you are a K-12, higher education or public sector organization embarking upon a critical IT modernization project, please consider partnering with Worldgate to provide you with an experienced Project Manager who is committed to your success.