Top reasons why finance system implementations fail
Anytime change happens, people get emotional. The world seems consumed in chaos. This is particularly true when it comes to IT implementations. Many don't go smoothly and some of them just flat out fail. That’s millions of rand and work hours down the drain!
IT projects often fail because of bad planning and miscommunication, despite the risks that come with new implementations.
Let's look at the major reasons why financial systems fail
1. Bad planning
If you will make system changes, you need to have a compelling idea of why you are making the change. You also need to scope the project to know exactly how much you can handle at any given time.
What specific problems and pain points do you currently have that need to be solved. This must lead to a clear problem statement, and future state that you are aiming for.
2. Miscommunication about the Change Management
The most important thing is to properly train and support users, even though this topic is complicated. Initial training is important, but ongoing support is even more crucial. Initial training is important. However, ongoing support is even more crucial. The support phase can last up to 3 months. Its aim is to help users effectively utilize the system. This support phase helps users solve their specific issues in their own environment.
3. Competence and ability to deal with change
The finance team | member running the finance function often don’t have the skills or time to manage and implement change. The best way is to treat any system change, regardless of its size, as a project. It should have a start and end date. Also, it's important to find a reliable vendor with a successful track record in implementing projects.
Best practices for accounting software installations
Here are tips companies can use when implementing enterprise resource planning (ERP) and financial systems.
Getting ready
- Clearly define why you are implementing the ERP/financial system. What are the objectives? What will you be able to do better?
- Communicate to the entire user community so there are no surprises.
- Make sure the whole team can see the vision and advantages the implementation will bring. Keep that enthusiasm alive.
- Document and communicate the scope — and try to stick to it. Defer extras to a second phase.
- Do a thorough selection exercise to ensure that the product actually does what you need.
Setting out
- Hire an experienced implementation team that knows the product well, has business expertise, and fits with your culture.
- Stay in the same boat. Make sure the senior sponsors and users all agree with the objectives and the timeline.
- Avoid a "big bang"; identify phases with clear deliverables and tangible results.
- Create a clear and visible task plan — and be prepared to flex it.
- Assign a respected internal senior person to be the responsible focal point.
- Make sure there is a budget contingency to ensure you can cover the cost of extending the test environment usage if there are unforeseen overruns.
- Allocate time for dedicated training; otherwise, this may cause you problems further down the line.
Staying on track
- Give it attention — make sure that the in-house experts, especially the business process leaders, have enough time to participate. Backfill the resource if you have to.
- Formally review progress every week without fail.
- On day 1, start analysing the data that will be transferred; it is not too soon.
- Recognise that your existing data will have many errors and a big cleanup is inevitable.
- A new ERP/finance system is a great opportunity to review your chart of accounts and financial segments; make the most of it to get business information that adds value.
- Don't go overboard loading historical data; summaries and period-end balances will normally be adequate.
- Encourage your in-house team to dive under the hood — start to learn the details about how the new system works.
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