Information technology plays a major responsibility in improving the aggressiveness of a company. Therefore, many business database computer program collections are available in the market. Enterprise resource planning(ERP) IS explained as a database software package that supports all of business processes and operations including marketing, financial, human resources among other fields. Alles et al. (2018). The main objective of the ERP is to have one consolidated system for the whole corporation. The ERP is highly advanced in its consolidation of all the database in the company and so the company is required to devote substantial expedient for planning, coaching and putting into practice of an ERP system. Secondly, ERP synchronizes reporting and automation. Rather than pressurizing workers to keep different database and programs that have physically integrated to produce reports. This allows workers to get the report from one system. ERP execution comes with high competitive business advantages yet it also has its problems and issues.
Challenges Facing the implementation of ERP system
The challenges facing the implementation of ERP system are grouped into six categories which include re-engineering (organization and infrastructure), head manager’s commitment, money, and expertise personnel according to Simmonds et al. (2018).
Reengineering is a core issue that has been encountered during the implementation of the ERP system. This is because putting into practice of an ERP system involves reconstruction instruction of the firms’ practices that have been there to the practices that will comply with the ERP system. For an organization to comply with the ERP model to ascertain smooth running and productivity it has to change its processes. The reason behind this is that ERP has no ability able to comply some company’s formation. Moreover, the cost to customize the ERP system to fit into the company is high. It has been explained that the more the customization, the greater the cost of implementation. Thus the companies are left with no alternative but changing its formation to suit the ERP package.
Secondly, top management commitment is another challenge identified facing successful ERP implementation. Imposing the ERP system is not just an issue of changing software system but a matter of shifting the company and modifying the business practices. As a result of vast effects on the competitive benefits of the company, the administration should be involved and working together until the end of the process. However, this is not the case, many ERP projects have been deserted by the board members arguing that a lot of money is used and less profit is recompensed. Thus there is no close supervision and devotion to ERP projects by the top administrators thus leading to it abandonment
Thirdly, funds are also a major issue facing ERP implementation. This is mostly encountered in its first phase of implementation. This has led to the division of members when called upon to help administer more money into the acquisition of recent technologies to obtain competitive benefits over the competitors. Others argue that a lot of money is used to a non-profitable project. Also, there are agreements that the IT department use a lot of funds in its project and zero or fewer profits are realized. Alles et al. (2018)
More so inadequate expertise personnel’s is also identified as a core problem to ERP execution. Despite the fact that it has been disclosed that companies planning to execute the ERP system should be ready to commit a number of their finest staff members to the project in order to have a prosperous implementation. Therefore, having a good understanding of the firm’s system and requirements, the internal employees are considered suite for the project. However, their major issue facing the organizations is inadequate understanding of ERP implementation amongst the staffs of a company. more so, some ERP trainers do not have all the required understanding of the ERP system and thus the inadequately coach the employees on the system. Thus effective functioning of the IT system is hindered. Also, the older workers in the organizational are so reluctant to change hence exhibiting lack of interest and readiness to learn about the system. This has led to enormous negative result on the functions of a company. Alles et al. (2018)
First Reengineering was a problem found during the implementation of the ERP system. It is the process of fixing the companies practices into the recently adopted ERP system to ensure effectiveness and positive output. To attain the aspiration competitive benefits, the company must be prepared to change its functions and comply with the ERP system. These amendments should be carried out throughout the firm’s administration approach so as to attain the wished competitive benefits
Similarly, top management was another issue identified by the group members. The head administrator has contributed to the rejection of the ERP system as they are the top role models of the employees. Therefore, employers follow the same steps and choose to abandon the existence of the ERP system project. The victory of ERP system entirely depends on the commitment of the whole organization as from the top manager. This is because the amount of dedication by the head administrators determines the accomplishment of the ERP system implementation. Therefore, their arrangements on the project have an enormous impact in the deserting or accomplishment of the system as stated by Simmonds et al. (2018).
More so, lack of expertise personnel was also discussed. This was due to insufficient training, the unwillingness of personnel to allow change and less skilled staff members. Therefore, coaching and bringing up to date staff members on the ERP system is significant. It is usually hard for trainers to pass knowledge to the employee in a short span of time since the whole process is comprehensive. Therefore, constant continuous training is needed to meet the changing requirements of the staff members and the firm.
Alles, M., Brennan, G., Kogan, A., & Vasarhelyi, M. A. (2018). Continuous monitoring of business process controls A pilot implementation of a continuous auditing system at Siemens. In Continuous Auditing: Theory and Application (pp. 219-246). Emerald Publishing Limited.
Simmonds, D., Tadesse, A., & Murthy, U. (2018). ERP System Implementation and Sustainability Performance Rating and Reputation.