Implementing An Erp System Is Not Easy

825 Words4 Pages
a. Risk Factors Implementing an ERP system is not easy and can be very challenging. Managers should be able to recognize and implement strategies to minimize risk, if they recognize the nature and magnitude of the risks they face in the implementation process, they are able to minimize the risks by employing project management and control strategies to address the challenges they face. There are some risks involved with ERP implementation, which involve technology, organization, people, and project size. The technology risks depend on how consistent the new technology is with the current organization and operating system. When an organization introduces technology that is inconsistent with the current database, operating system, and network management environments, the risk is greater. Companies are at a higher risk of failure when the system implementation will require major changes in their current infrastructure. The next area of risk is organization factors. When business processes are redesigned to fit the purchased software package, the risk of excessive time and cost investments decreases. In addition, customization poses the risk of extra, if not excessive project costs. The third area of risk deals with people resources. If the IT employees are familiar with the application-specific modules of the ERP system, then the likelihood of implementing the system effectively will be enhanced. Although, if the current skill mixes of the IT employees do not
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