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Why ERP is still so hard

Why ERP is still so hard

After nearly four decades, billions of dollars and some spectacular failures, big ERP has become the software that business can't live without--and the software that still causes the most angst. In Part I of CIO.com's analysis of the ERP market, we look at where ERP has been, where it's at today, and why it's still so hard to do these mission-critical projects well.

Steve Berg knows what intense pain feels like: The man has been Tasered, in fact-not because he ran afoul of the law, but as VP of IT at Taser International he's partaken in a corporate rite of passage. "It's the worst five seconds of your life," he says. "You cannot move."

Like other IT execs, he also knows pain and suffering as it relates to ERP-from vendor selection and licensing negotiations, to implementation and change management, followed by upgrades and integration. And as he and many other IT leaders have come to know, ERP-induced pain can last much, much longer than a mere five seconds.

Taser's attempt to wrap an ERP package around its corporate processes sounds eerily similar to most companies' experiences. The "before" picture: A mélange of disparate systems that didn't talk to each other and a good deal of "paper pushing" between the systems, Berg says. "When you don't have a centrally managed technology environment," he says, "things can get overly complicated very quickly."

Executives had sought a unified system so that Taser "could do a complete workflow throughout the company without having to run redundant systems that don't communicate," he says. That was 2004. Microsoft's Dynamics AX was eventually selected. And again, like many companies, Taser decided to customize its chosen ERP package to meet the business processes that it already followed. "So rather than take an ERP system-which supposedly out-of-the-box has, say, an accounts receivable [process], with best practices that are inherent to the system, we decided...to modify AX to work like this other application because users were comfortable with it," he says, "and they didn't want to change."

But a funny thing happened on the next upgrade: Naturally, all of those customizations done to the initial AX rollout-which were "plentiful," Berg says-were going to have to be upgraded in 2009. Taser decided it didn't want to go down that road again. This time, Taser ERP users would change, demonstrating that vendor-purported "flexibility" has been both ERP's blessing and its curse.

"We're going to get rid of these customizations and go back to what the [Microsoft] AX best practices and recommendations out of the box," Berg says. "If we're going to be able to grow the company-we're at $100 million now and if we want to be a half-billion company in four years' time-the current processes are not allowing us to get to that point."

The upgrade took longer than expected: Testing and training issues, as well as certain customizations that were unavoidable, complicated progress along the way, Berg reports. Executive sponsorship and interest never waivered, though. "It seemed like all eyes were on this upgrade and all eyes were on IT to make sure nothing could go wrong," he says. "Everybody understood the long-term benefits, but there will always be some teething pain at the beginning. We went live in May [2009] and now we're in July, and things are running smoothly. But May and June were pretty tough."

Taser's tale probably seems commonplace to IT vets. But the fact that Taser's story is so common, so expected, so universal, after nearly 40 years of all things ERP, makes it all the more significant.

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