Enterprise resource planning (ERP) systems play a critical role in day-to-day business operations, from financial forecasting to supply chain management. However, shifting to a new system can be a significant undertaking for organisations, bringing with it high expectations of return on investment (ROI).

Integrating new software into existing operations often means staff must adapt quickly to new ways of working. However, without putting in place an effective change management strategy that prepares and supports staff through the process, businesses risk failing to achieve the productivity and growth they originally forecast.

At Nexer, we help clients implement Microsoft Dynamics 365 ERP solutions in a way that supports employees from customer service to C-suite. Here, we’ve explored five key consequences of not implementing a change management strategy throughout your ERP rollout – and why careful planning, monitoring, and tracking activities are critical.

1. Increased resistance to change

New ERP systems can affect the way that employees perform daily tasks. Without providing teams with time to understand the need for upcoming changes which will impact their work, or the necessary guidance to use the technology effectively, staff are less likely to welcome their introduction. From reluctance to use new systems to low morale and staff retention, these issues can significantly hinder progress or even cause the failure of a project. This can result in costly delays and wider business implications due to colleague apathy.

By providing thorough training, a supportive environment for employees to voice their concerns, and clear lines of communication throughout the transition, organisations can take staff along with the journey and support overall success.

2. Reduced productivity

One of the most immediate consequences of not utilising change management strategies is reduced productivity. Without the right education on new ERP systems, employees may continue to rely on more familiar, inefficient ways of working. Equally, a lack of knowledge is likely to increase the time it takes for staff to complete their tasks using new systems.

This reduced productivity can cause commercial damage, from lost opportunities to potential impacts on revenue. As such, change management strategies that teach employees to leverage the technology’s capabilities can help drive productivity and growth.

3. Increased errors

ERP systems have an important role to play in data management, financial reporting, and customer service. However, if sufficient training isn’t provided, employees are more likely to make mistakes due to misuse of new technology. These types of errors create the potential for data corruption and financial losses, resulting in implications from customer dissatisfaction to regulatory non-compliance and legal issues.

4. Reputational damage

If the ERP system that operations rely on fails, the organisation’s ability to deliver on its promises is likely to be called into question. This can damage trust among existing clients and partners, and even cause customers to project poor experiences externally. This can also make it difficult to attract new customers and partners.

A structured, forward-thinking change management framework can help businesses avoid reputational risks. Effective frameworks should clearly underline the plan of action, identify potential obstacles, and ensure that all stakeholders understand the project’s objectives. Businesses can then navigate the transition with agility.

5. Loss of employee confidence

The success of digital transformation heavily depends on the commitment and engagement of employees expected to use new ERP systems. Without an effective change management programme in place, employees may feel overwhelmed by new software and feel less confident in their abilities and the organisational governance. Failure to support employees through the process of ERP implementation can have long-lasting consequences that reach beyond the completion of the project. For example, without providing clear communication, training, and ongoing guidance to help staff navigate the transition, employees may become demotivated, less engaged, or even seek employment elsewhere. Loss of talent can severely disrupt the productivity of an organisation, particularly in sectors such as manufacturing and retail, while recruiting skilled employees can also come at a cost.

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Implementing a new ERP system comes with its risks but having the right technology to keep up with consumer demands and effectively manage operations is business critical.

While change management strategies differ between organisations, implementing a considered framework that helps to avoid costly consequences can support businesses to execute digital transformation successfully. Through Change365, we deliver a flexible approach that helps organisations create an environment that embraces the shift to Microsoft Dynamics 365 and makes the most of intelligent technology.

Find out more about Nexer Enterprise Application’s Change365 offer here:
https://nexergroup.com/uk/change365-engage-your-people-in-change/