ERP implementation throughcritical success factors’

managementOlivier Francoise

INEUM Consulting, Paris, France, and

Mario Bourgault and Robert PellerinDepartment of Mathematics and Industrial Engineering, Ecole Polytechnique,

Montreal, Canada

Abstract

Purpose – The purpose of this paper is to identify practical activities that are essential for managingenterprise resource planning (ERP) implementation projects and that answer to the expectations of thewidely recognized critical success factors (CSFs).

Design/methodology/approach – This work is based on an extensive literature review on CSF,which has been followed by a Delphi survey with a panel of ERP experts. For each CSF, it obtained arange, validated by experts, of practical actions to perform, supported by the resolution of theproblems usually encountered in these areas.

Findings – The work carried out has a practical scope: the principles of the proposed method directlyaffect all actors in ERP projects and gives them practical results that they can apply immediately.When applied in the framework of the methodology the paper suggests, these actions will result inbetter oversight over the requirements of each area of expertise. In this way, overall grasp of theproject is facilitated, reducing the inherent uncertainties.

Research limitations/implications – Findings may be limited by the small number ofrespondents, but each one had participated in several implementations. Moreover, no industrysector was specifically targeted; thus, the results apply a priori to most implementations.

Originality/value – This research helps to draw the academic and professional domains together byproposing, for the first time, a way for theoretical findings to be translated into practical actions. Theseresults will allow all actors in an ERP implementation to understand the project imperatives faster andmore accurately.

Keywords Project management, Critical success factors, Information systems,Manufacturing resource planning

Paper type Research paper

IntroductionFor a number of years, enterprise resource planning (ERP) systems have beenacknowledged to be the technological solution that is best adapted to meet businesses’needs for efficiency and effectiveness when it comes to information management.These software packages are known for their ability to integrate all of a company’sinformation needs within a single computer system (Koch et al., 1999; Ehie andMadsen, 2005); in return, this gives management a better overview of all of thecompany’s operating and managing activities.

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Business Process ManagementJournal

Vol. 15 No. 3, 2009pp. 371-394

q Emerald Group Publishing Limited1463-7154

DOI 10.1108/14637150910960620

ERP systems are generally designed and programmed by independentorganizations outside the client companies. They are structured around a finitenumber of organizational models resulting from best practices identified in differentareas of activity. During an implementation, it is therefore necessary to put complexprocesses in place to enable the organization to adapt and the system to be configuredand optimized. The scope of an ERP project is huge and involves as much uncertaintyas there are benefits expected from these systems.

From the point of view of project management, ERP implementation constitutes amajor challenge. Budgets are often expressed in millions of dollars and schedulesstretch out over several months, or even years. It has become common to observe a gapbetween results and the initial objectives. The study by Wang et al. (2005), for example,noted that costs average 178 percent over budget and implementation periods 2.5 timeslonger than anticipated.

One of the probable reasons for these mediocre results is the large number of areasof expertise that must be managed during the implementation. Project managers mustgrasp technical issues such as system development and process reengineering. Butthey must also master the human and organizational domains such as changemanagement and end-user involvement. These areas of expertise have now beenidentified by practitioners and researchers: they are known as critical success factors(CSFs). They have been extensively studied and each area is covered by a vast body ofthe literature. Nevertheless, there still seems to be a gap between this series of genericfactors and operational project management. In other words, the connection that wouldmake these factors “actionable” by practitioners still appears to be missing.

This study proposes to identify practical activities that are essential for managingERP implementation projects and that answer to the expectations of the widelyrecognized CSFs. More specifically, the objectives of this study are to:

. draw up a list as complete as possible of management activities that areindispensable to implementing an ERP system and associated with success factors;

. contribute to decreasing the uncertainties related to ERP implementations; and

. help all project actors to better control the various areas of expertise required.

The proposed approach is based on the abundant literature on this topic, as well as theempirical data collected with a Delphi survey of professionals. The result is aninnovative approach that enables project managers to proactively handle the potentialexpertise areas related to implementation.

Literature reviewSince they were introduced in the early 1990s, ERP systems and their complicatedimplementations have given rise to numerous publications. Many initiatives, comingfrom both the academic and professional communities, have suggested a range ofsolutions to improve performance in managing implementations. Overall, we candivide the literature on ERPs into four groups of approaches.

The study of the implementation process constitutes the first approach. Thus,strenuous efforts have been made to identify and propose a number of possiblestrategies (Parr and Shanks, 2000). The processes to be put in place in order to succeedat the first attempt have been identified (Donovan, 1999), and the main features of thecrucial activities have been proposed (Al-Mudimigh et al., 2001). More specific studies

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have also been conducted to analyze, for example, the border between optimization andadaptation (Luo and Strong, 2004) or propose project assessment tools (Esteves andPastor, 2002a). By determining the common points between companies that succeedand those that fail, possible avenues for best practices have also been explored (Mabertet al., 2003).

The analysis of the organizational problems created is the second approach. Duringan ERP implementation, the entire structure of a company is turned upside down.From the hierarchy to user involvement, the points of view are different, sometimes inopposition, and must be properly managed (Amoako-Gyampah, 2004). If a company isphysically dispersed (mono- or multi-site), then certain choices must be made (Markuset al., 2000), since cultural problems can arise (Davison, 2002). The very way in which aproject is managed has been reconsidered, in particular by the study of Goal directedproject management (Metaxiotis et al., 2005) and Agile management (Alleman, 2002).Finally, the company’s size will naturally raise a number of questions, since a small ormedium-sized enterprise will not approach implementation in the same way as amultinational (Muscatello et al., 2003).

Risk management represents a third approach, since ERP implementations arecharacterized by a high level of uncertainty. The risks associated with these projectshave been discussed by numerous authors (Bernard et al., 2002; Huang et al., 2004), andidentification techniques differ from one study to another. Tools have also been createdto allow managers to identify the risks that are most relevant to their projects(Zafiropoulos et al., 2005).

The study of CSFs constitutes the fourth and last main approach and accounts for asignificant amount of the literature. These factors are defined as being the limitednumber of areas which, if their objectives are met, will guarantee success for theorganization (Rockart, 1979). The question of how to identify them has been addressedin numerous publications (Cantu, 1999; Holland and Light, 1999; Nah et al., 2001;Gargeya and Brady, 2005), and it is easy to draw up a fairly comprehensive list of suchfactors. By studying the literature, including the works of the above-mentioned authorsplus a number of others related to knowledge management (Kanjanasanpetch and Igel,2003; Chang, 2004; Sun et al., 2005) and end-user involvement (Esteves et al., 2002;Bradford and Florin, 2003; Huang et al., 2004), we have developed a list of 13 criticalfactors, as shown in Table I.

This list of critical factors covers a series of areas of expertise, the management ofwhich is particularly crucial for project success. It affects both processes, such as thereengineering or software development phases, and organizational problems such asthe involvement of management and end-users. In addition, it is intended to apply to amajority of implementations and organizations.

The project teamwork and composition is extremely important, since these actorsare at the core of critical activities throughout the project (Nah et al., 2001). Manyauthors insist on the need for a multidisciplinary team that can understand and takeinto account the needs of different departments and the interactions among them(Kumar et al., 2003; Sarker and Lee, 2003). Kumar et al. (2003) indicate that the keyactors are the representatives of different departments plus information systemsexperts. Zafiropoulos et al. (2005) insist upon the need for a transfer of autonomy to theteam in order to allow for speedy decision-making and the efficient running of theproject. Nevertheless, Sarker and Lee (2003) note that a balanced team that is invested

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with appropriate authority is not enough for the project to succeed; it is also necessaryto achieve group cohesion (Wang et al., 2006). In addition, the team must be supportedby a leader and/or by management (Sarker and Lee, 2003; Wang et al., 2005). Finally,the people who make up the team must be freed up as much as possible from their otherobligations within the company (Sarker and Lee, 2003).

The implementation of good change management practices is absolutely crucial,since an ERP necessarily leads to changes in how things are done and therefore toreluctance on the part of end-users. This aspect of the management of ERPimplementation is one of the most difficult ones for managers to deal with and fewauthors indicate what steps should be taken. Every company has a culture, which mayor may not be strong and enduring, and which may be reflected in either openness tochange or the opposite. Change must be recognized as an integral part of businessprocess development, especially by the people with the most seniority. Finally, userinvolvement and training will help to maximize the acceptance of changes (Kumar et al.,2003).

Top-management support is one of the most important critical factors (Ang et al.,2002). Members at various levels of the hierarchy will need to be involved throughoutthe project (Jarrar et al., 2000; Nah et al., 2001). Nah et al. (2001) and Jarrar et al. (2000)remind us that it is essential that top management allocate the necessary resources andtime for the project to be executed properly. Management must define new objectives inorder to give employees a clear vision of the orientation the company is taking, throughthe new system to be implemented. It must also approve and support all the decisionsthat are made and take part in resolving any conflicts that may arise.

The definition of a business plan reflecting a long-term vision is also seen as crucialsince the implementation of an ERP generally constitutes a repositioning of thecompany and its business plan (Bingi et al., 1999). Management must give carefulconsideration to the objectives of the implementation and establish their origins.Boudreau and Robey (1999) propose a vision of the ERP as a teleological change (aproject positioned within a strategy), given that a business plan and a long-termstrategy are necessary as soon as the project starts up and will be referred toconstantly until it is completed (Nah et al., 2001). This vision, which is defined at thestart of the project, must specify how the ERP and the organization will relate to each

1. Project teamwork and composition2. Organizational culture and change management3. Top management support4. Business plan and long-term vision5. BPR and customization6. Effective communication7. Project management8. Software development, testing and troubleshooting9. Monitoring and evaluation of performance

10. Project champion11. Organizational structure12. End-user involvement13. Knowledge management

Note: List of factors derived from a literature review

Table I.Critical factors inimplementing ERPsystems

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other (Abdinnour-Helm et al., 2003). Finally, Amoako-Gyampah (2004) indicates thatthis vision must also be shared by and common to all of the people engaged in andconcerned by the project, in order to avoid lags.

Business process reengineering (BPR) and customization are crucial project phases.According to Rajagopal (2002), ERP projects push organizations to revisit theirbusiness processes and explore new ways of doing things relatively to the bestpractices embedded in the system. Throughout the BPR, business processes must bereviewed, using appropriate tools. The more in-depth this review is, the better theoutcome of the BPR will be. According to Kumar et al. (2003), BPR often leads to delaysin ERP implementation. Although Gargeya and Brady (2005) note that someoptimization is always necessary to meet individual needs, the minimization of codeoptimization is a common point shared by all the organizations under study thatfinished on time (Mabert et al., 2003). Finally, there are a certain number of techniquesand tools that can be used to support the various stages of BPR.

The need for effective communication is permanent and affects all the criticalfactors studied above. Communication within the team goes beyond informationtransmission and affects areas such as conflict resolution and the definition ofobjectives and roles. The PMI (2004) advises teams to define a clear “communicationcharter” at the outset that all players are familiar with and that can be reviewed duringthe course of the project: the communications management plan. This plan mustclearly define who needs what information, who is supposed to provided it, when itshould be transmitted and by what medium. Thus, from the start of the project, everyteam member will be aware of how most information exchanges will take place duringthe project. This factor is even more important if the project is going to bring togethermany people from different departments, and different cultures, which will require thecreation of a common language (Gillard, 2005).

Project management consists of the establishment of a cycle of activities that willmake it possible to ensure that the implementation proceeds as planned (Esteves andPastor, 2002a; Zhang et al., 2005). Since this type of project calls on numerous differentgroups to take part and presents a high level of uncertainty, it depends on solid projectmanagement knowledge (Akkermans and Van Helden, 2002). Zhao (2004) recommendsthat the whole project team possess good project management know-how. The presenceof skills related to planning, organization, follow-up, and control over the project phasesis vital. The project manager must be able to head up the project and recognize andovercome difficulties. Thus, Kumar et al. (2003) indicate that the manager’s projectmanagement capacities are the number one criterion for selecting this person, even morethan experience, role in the organization or initiation of the project.

Software development, testing and troubleshooting is a critical step that kicks inonce BPR has started, since the software must be configured and sometimes modified.Then, before it is transferred to the new platform, it must be tested and strategies forsolving problems or bugs must be put in place. Several operations need to be carriedout such as parameterization and transfer of data from old databases to new ones. Thework to be done during this phase varies according to the reengineering performed, theease of modifying the software and the company’s programming skills. Kim et al.(2005) and Gargeya and Brady (2005) also point out that the system testing phase hasproven to be a key success factor for certain companies and a direct cause of failure forothers.

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It is necessary to monitor and evaluate project performance since anything thatcannot be measured cannot be managed (Jarrar et al., 2000). Based on the planning,control plan, progress reports, and change requests, the manager updates the planning,informs team members of approved changes, and puts in place the necessary correctiveactions. Although monitoring and follow-up are key activities that are mentioned inmost publications, very few of them specify exactly what tasks must be carried out.For example, Berchet and Habchi (2005) insist on the importance of developingeffective, measurable indicators to ensure good project follow-up, but does not suggestwhat these factors might be. Esteves et al. (2002) note that research in the area of ERPproject follow-up and monitoring is not very advanced. The expectations of differentgroups must be translated into measurable deliverables (Cicmil, 1997). The entire teammust participate in following up and monitoring tasks in this type of project, given thatthe uncertainty level is very high: from management (Jarrar et al., 2000; Ang et al.,2002) to the champion (Esteves et al., 2002), all actors must be involved.

The project champion is essential to the implementation. Through his or herinvestment and persuasion, the champion facilitates team motivation and helps tocreate enthusiasm and convergence on common goals. But it is not always clear how tobring everyone together around the champion, given how big such projects tend to be(Sicotte and Langley, 2000). In general, the more uncertain a project is, the moreimportant the champion’s role will be. Somers and Nelson (2001) indicate that thechampion must be aware of the project’s technological and strategic issues. In additionto leading the project and giving it a vision and an aim, the leader must also remainopen and understand team members’ problems (Wang et al., 2006). This process will beeasier if the champion is accepted by the workers (Ashbrook and Houts, 2002). Finally,in addition to promoting the project on the organization’s shop floor, the championmust take part in the follow-up activities and monitor the project’s progress (Estevesand Pastor, 2002b) and get involved in executing the whole project.

Organizational structure is a determining factor for project success. The betteradapted the structure is to the ERP system, the more likely it is that theimplementation will be successful (Hong and Kim, 2002). Nevertheless, an ERP systemis designed to be suitable for the greatest possible number of companies, and thus itsexact functioning is defined by the parameterization during the course of the project(Soffer et al., 2005). Many organizations have been known to underestimate the lack ofalignment between the ERP and their organizational structure, and thus the amount ofwork required during the implementation.

End-users must be involved in the project, from start to finish; this is just as crucialas the involvement of top management in an ERP project (Ghosh, 2002). Userinvolvement and participation is one of the most frequently cited CSFs (Esteves et al.,2003). In addition, this ensures that users’ requirements will be better respected andthus the system will be of better quality, easier to use and less likely to stir upresistance (Esteves et al., 2003). Users must perceive the system as being important andnecessary to their work (Barki and Hartwick, 1991), since user involvement in thedecision-making process results in greater attachment to the success of the project(Esteves et al., 2003). By helping to develop realistic expectations, allowing betterconflict resolution during design activities and improving mastery of the system(Esteves et al., 2003). Finally, the problem of training end-users must be addressed. Thebest system in the world will not improve a company’s performance if the employees

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do not know how to use it. Training costs are often underestimated but training iscritical in an ERP project (Jarrar et al., 2000; Kumar et al., 2003; Tinham, 2006).

Knowledge management during ERP implementation projects is a central factor.First, it is crucial to exchange knowledge and problems within the organization.Employees possess a base of knowledge that is indispensable to the company and thatmust not be forgotten during reengineering. Thus, a knowledge management processmust be put in place within the organization itself. In addition, to facilitate projectmanagement, it is important to ensure that information will be correctly exchangedwithin the project team. Finally, the organization must put processes in place that willenable it to acquire a maximum amount of knowledge from consultants so that it willbe able to use the system autonomously.

The list of 13 CSFs presented above provides some important tracks that can guideproject managers in identifying areas in which intervention is needed. However, thesefactors are still generic and rarely make it possible to identify practical actions that areclose to the manager’s work on the ground. In this sense, one can say that the CSFapproach remains incomplete if it does not lead to specific practical guidelines foractors in an implementation project. This is exactly the connection that the presentstudy focuses on.

MethodologyThis section presents the method that was used to carry out the empirical study of theconnection between CSFs and project operating activities. This method, which isillustrated schematically in Figure 1, proposes that knowledge of the difficultiesgenerally encountered during these projects constitutes a basis for the execution ofpractical actions that will make it possible to prevent these difficulties and master thecritical areas. The identification of the actions that result from critical factors relies on

Figure 1.Structure of the ACSF

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the difficulties experienced during projects, this kind of information being often theeasiest for practitioners on the ground to obtain. Briefly, although the goal of the studywas to propose a list of practical actions, this list endeavors to solve the difficultiesrelated to the areas of intervention (success factors) identified during a preparatorystudy.

The process consisted of three major steps:

(1) In the academic and professional literature, identify the main difficultiesexperienced by teams and managers during ERP implementation projects.

(2) In the literature, identify actions that have proven to be indispensable in projectmanagement, as related to these difficulties.

(3) Conduct a Delphi study of professional managers to assess the relevance ofthese actions and supplement the initial list.

This research framework (Figure 1) also constitutes a project approach that is relevantto implementation managers. The identification of difficulties and actions, and theirclassification according to their relationship with success factors, constitutes aninnovative approach, which we call actions-critical success factors (ACSF); it can easilybe juxtaposed with the classical project management approaches. This method ispresented as a guide to structure the management of actions and difficulties; itsuggests that project managers be proactive. When the typical difficulties that ariseduring ERP projects are identified, it becomes easier to create an alert piloting teamthat is able to rapidly identify problems and even to be proactive in attempting toprevent them.

During a project, the ACSF method proposes the following approach:. learning actions from the start of the project;. planning of actions’ execution in conformity to objectives and available resources;. execution and monitoring of actions;. communication supported by actions throughout the project duration; and. vigilance in the face of difficulties.

The ACSF method favors awareness, from the launch of an implementation, ofthe actions that must be taken to maximize the chances of success. Next, after studyingthe required and available resources, the execution of actions must be planned for theentire implementation. As the project is being carried out, the CSFs have to be followedup and monitored. Finally, in parallel to these activities, and throughout the entireduration of the project, the project actors must continue a dialogue enhanced by thesefactors and the related actions, in order to foster a common understanding of problems.

The rest of this section presents how the principal elements of the model –difficulties and actions – were determined.

Difficulties affecting ERP implementationDuring the course of a project, a number of obstacles may arise, slowing down themanager’s work. Without engaging in an in-depth risk management process, whetheror not the manager decides to initiate one, it is necessary to be aware of these typicaldifficulties in order to detect them easily and react more quickly.

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The papers by Chang (2004) and Kim et al. (2005) stand apart from the classical CSFapproaches. These authors spotlight the problems identified in a range of case studies,with a hands-on approach. Their procedure involved assigning the difficultiesidentified to different classes related to the critical areas. We propose to reclassify theseobstacles, while eliminating duplicates, according to CSFs (Table I) and thus to create alink between the CSF areas and the difficulties that may be encountered whileexecuting an ERP project. As presented in Appendix, we therefore drew up a list,adapted from Chang (2004) and Kim et al. (2005), of the difficulties related to ERPprojects that may result from neglect of the critical factors.

In the end, we classified 107 difficulties on the basis of CSFs. This list is notexhaustive, but it will enable users to become aware of the typical traps that ariseduring implementations and thus to avoid them more easily.

ActionsActions are indispensable activities that the project manager must carry out in order tocontrol the various critical areas, and thus the project as a whole. They weredetermined by a procedure that started with an analysis of the literature, which wasthen complemented and validated by a survey of professionals. This empiricalvalidation was essential in order to rank a long list of actions.

Identification of actions in the literatureThe list of practical actions proposed in the literature comes from two main sources.The first is directly or indirectly related to ERP systems: scientific and professionalpublications in the areas of information systems management, project managementand business management, for example. These papers are very useful and represent anindispensable first step in identifying the actions. For certain sections of Table I, andespecially for performance monitoring and assessment, there is an obvious scarcity ofresearch. The second source consists of papers about project management in general.By abstracting away from the topic under study, one can identify, on one hand, certainbasic and indispensable practices and, on the other hand, innovative solutions fromrelated fields of study.

The literature review constitutes the first step in the construction of the mostexhaustive possible list of actions to be taken. This review culminated in the analysisof close to 100 papers and enabled us to identify 73 activities. Thus, the initial listpresents points that stand out as being indispensable from the academic perspective.

Validation of actions by a Delphi surveyOnce the list of actions had been decided on, our objective was to validate its relevancewith a group of professionals, on the basis of their experience on the ground.Ultimately, we wanted to obtain a short list that had been ranked by the experts. Wechose to consult with the professionals by means of a Delphi survey in two rounds,with questionnaires distributed either in person or by e-mail. This type of studyallowed us to control the panel we questioned and interact with them withoutintroducing psychological biases.

The Delphi method was created in the 1950s as the fruit of a study commissioned bythe US Air Force from the Rand Corporation. In general, it structures and facilitatescommunication within a group concerning a complex problem so that a consensus can

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be reached after several iterations (Loo, 2002). Unlike classical questionnaires, theDelphi method aims to establish a consensus of opinions, judgments or choices (Keeneyet al., 2001). It must be able to exploit the advantages of group work without beingaffected by the inconveniences, in particular dominance and psychological influence(Rowe and Wright, 1999). The information is gathered from a panel of carefully chosenexperts, who represent a wide spectrum of opinions concerning the topic (Loo, 2002;Windle, 2004). The process starts with a first “idea-generating” round. After theseinitial results are analyzed, they structure the rest of the survey. Then, as furtherrounds take place, the experts receive feedback to their responses and those of the otherparticipants so that they can discuss everything and move towards a consensus(Keeney et al., 2001).

Since one of the goals of our study was to propose a list of actions anchored in thereality of ERP implementation project management, the panel of experts was made upexclusively of experienced professionals. Although all 12 project managers who tookpart in the study have similar titles on their business cards, their profiles are quitedifferent. Most of these managers were consultants, although some came fromindustry. In the end, the panel comprised people with 2-20 years of experience, who hadworked on implementations with budgets ranging from $50,000 to $15 million. Manydifferent software packages had been implemented: from SAP through Baan and JDEto Oracle. The number of respondents was small, but their experience covered asignificant number of kinds of implementations; moreover, we did not want to studyany particular industry sector. Thus, a priori, the results we obtained should beapplicable to a majority of ERP implementation projects.

Each round of the study had a very specific objective. In the first round, themanagers assessed the actions identified in the first part of the study: the literaturereview of each factor. For each area, after a brief definition, each action was judged on ascale of 0-3 (secondary to indispensable). Then, for each area, respondents were invitedto suggest actions on the basis of their own experience, which resulted in 78 newactions for the list.

The second round took place four weeks after the start of the first one; it is shown inFigure 2. All respondents received a short report on the results of the first round. Thepanel’s opinion was initially presented in the form of a mean. After viewing this andtheir first evaluations, all respondents could choose to modify the first evaluation orleave it as is. Then, for each area, all the suggested actions were presented and theexperts were asked to assess them.

In the end, we had 151 actions that had been weighted by a panel of projectmanagers. Our initiative had therefore enabled us to draw up an almost exhaustive listby identifying actions that are deemed to be indispensable in the literature and thosethat our experts considered to be crucial. The next section will discuss the results of thesecond round.

ResultsWe obtained a vast amount of data in this procedure. Thus, it is not possible to presentall of it in this paper. Only the actions that the experts considered to be important willbe presented. In the remainder of this section, following a brief discussion of eachfactor, the actions retained will be presented in order of decreasing weight.

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Project teamwork and compositionThe composition of the project team aroused a good deal of interest, given that thisis the factor for which the professionals suggested the most new actions. At the headof the team, the project manager must have adequate authority and become involvedas soon as possible, as must the company’s management. If additional compensation isnot possible, the actors must be freed up from their other duties as much as possible. Itis indispensable to recruit from different sectors of the company in order to create amultidisciplinary team.

The study found that the actions contributing to the composition and work of theimplementation team factor were as follows:

. Get management directly involved in supporting the team and transferringauthority and responsibility.

. Make up a multidisciplinary team, selecting representative elements from all ofthe company’s departments.

. Ensure that the team leader possesses authority that is recognized throughoutthe company.

Figure 2.Sample second-roundquestionnaire for the

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5. Regularly measure the quality of information transmitted with the people concerned. 1.7

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. Free up members from constraints unrelated to the project (for example,obligations related to their usual positions).

. Integrate experienced consultants.

. Set up a simple, central communication system (calendar, tasks, decisions, etc.).

. Select members who are influential in the organization.

. Encourage members to get involved and learn during the project.

. Organize documents efficiently on the company’s computer system.

. Formally document all members’ roles, authorities, responsibilities andcompetencies.

. Ensure that the team has adequate decision-making power.

. Set up a clear personnel policy regarding changes.

Organizational culture and change managementChange management, which must start as soon as possible, needs to get under way byobtaining the support of mid-level managers (who are too often neglected) and opinionleaders. Although this factor is deemed critical for a successful go-live, paradoxically itdoes not require a full-time manager, but it does demand a major human effort andstrong management involvement.

The actions supporting the organizational culture and change management factor are:. Formally obtain support from opinion leaders.. Ensure that executives accept the new system.. Right from the outset of the project, assess the organization’s capacity to accept

change.. Ensure that the training provided for the whole organization is complete.. Identify the risks and define mitigation plans.. Formally evaluate the scope of the change in order to control its impacts and

risks.. Circulate information on the benefits and changes that an ERP system will

produce.. Manage expectations concerning the system’s functionalities.. Do not start the transition prematurely, before the whole organization is ready.. Begin efforts to reduce resistance to change at the very start of the

implementation.. Consolidate employees’ motivation throughout the project (regular information

sessions, for example).. Set up conference room pilots during the project: meetings during which the

people affected by the project can learn about the new system.. Specifically, train the project leader to handle change management problems.

Top management supportAs an indispensable condition for the project launch, involvement by managementshould first identify the officers concerned, and then communicate the desired level of

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involvement. These people must then be trained regarding the project processes andissues. Next, it is important to ensure that initial intentions are adequately expressed indaily operations. For example, it is advisable to get management involved in thedecision-making process when necessary.

At the end of the study, the actions presented for the top management supportfactor are:

. Inform selected members of top management of the details of the processes to beundertaken and the project’s impacts on the organization.

. Identify the top management members concerned by the project.

. Make the managers of each business sector accountable for the success of theproject to ensure that they will be motivated and will support it.

. Set up a management committee.

. Plan for monthly or twice-monthly meetings with management.

. Get top management directly involved in choosing the type of involvement.

. Get top management directly involved in the project follow-up activities.

. Stimulate management’s interest in the new system.

. Have top management intervene from time to time in the ongoingdecision-making process.

. Ensure that initial intentions of support are adequately reflected by actionsduring the project.

Business plan and long-term visionThe company’s business plan and long-term vision will make it possible to link theERP project to organizational strategy, and determine the goals to be met and theirfeasibility. Although no departmental targets should be set, the project must remain apriority and should not become mired in conflicts over resources or capital. The ERPmust be correctly positioned and it is important to be aware that the decisions madewill have consequences over the long-term.

The actions supporting the business plan and long-term vision factor are:. Identify and formally communicate the link between the ERP and the company’s

strategy.. Identify the goals of the ERP implementation and assess its financial, technical,

and organizational feasibility.. Re-evaluate the achievement of goals throughout the project.. Achieve consensus in advance from the whole management team regarding the

goals of the implementation.. Define the ERP implementation as the organization’s most important project.. Make executives accountable for the achievement of organizational goals.

Business process reengineering (BPR) and customizationBPR continues to be a controversial field, as some people consider it to beindispensable while others feel it is undesirable. Although the creation of adedicated team cannot be a majority-rule decision, the formalization of the extent

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of reengineering and the minimum customization of the system are critical. BPRactivities must be recorded in the plan. The target processes designed must bevalidated by management. In addition, it must be remembered that if their performanceis to be measured, the existing system must be audited first.

The actions related to the BPR and code modification factor are:. Formally identify the limits of reengineering and customization of the

application before starting the configuration activities.. Opt for minimal customization of the application.. Validate the new processes with management.. Record specific reengineering activities in the project plan.

Effective communicationCommunication is a key factor in any project. Depending on the organization, it maytake different forms. Nevertheless, it must always start with the creation of acommunication plan, which formalizes direct and regular exchanges. The languageused must be easy for everyone to understand. Conflicts can become a major drag onthe project and must be correctly managed, both formally and informally.

Further to the study, the actions that favor effective communication are:. At the start of the project, create a communication plan.. Use language that members of all departments can understand.. Make the team formally aware, right from the start, of the need for open and

ongoing communication.. Set up a formal and informal conflict and resistance resolution process.. Centralize information for a common understanding of decisions.

Project managementThere is no question that effective project management must start with the definitionof the requirements for the project leader position. His or her first task must then be todefine the perimeter of the project, and to monitor it attentively as the project advances.Risk management plays an essential role, which may or may not be reflected in anin-depth study, depending on the corporate culture.

Project management is based on the following actions:. Continuously monitor the project to make sure that it does not overflow the

defined scope.. Formally define the scope of the implementation as soon as the project starts.. Define the requirements for the project manager position.. Formally evaluate the project manager’s competencies before the project is

launched.. Obtain management’s agreement with any change in project scope.. Ensure that material, human and financial resources will be available.. Assign a full-time project manager.. Confirm the project scope with the manager (schedule, risks, resources, etc.).

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. Set up a system for managing and monitoring critical factors identified duringthe initial planning.

. Set up a formal risk management process.

Software development, testing, and troubleshootingParadoxically, the most important point related to software development is the creationof a competent technical support team that is able to react quickly after the go-live.This point is essential inasmuch as it is often untenable to continue testing as long aserrors remain. Of course, one must also ensure that the development team possessesthe appropriate knowledge, and the related activities must be detailed in the projectplan.

The list of actions on which the software development and testing factor is basedare:

. Set up a competent technical support team before the go-live.

. Be able to react quickly to any problems after the go-live.

. Integrate development activities into the work plan.

. Set up a development team that has the necessary knowledge of ERP systems.

. Define a development and testing plan.

. Carry out specific activities to follow up on development activities.

. At the start of the project, formally identify all the development requirementsregarding the other project areas.

. Document all custom developments.

. Carry out all testing activities with future users.

. Do real load tests on all the modules installed, using real data.

. Define and document use profiles.

. Perform technical tests, particularly on peripherals.

. Predefine the test sets to be validated before the development or integration of athird-party product.

. Use a development and test methodology.

Monitoring and evaluation of performanceIn order to be able to pilot the project, one must put indicators in place that will allowfor adequate visibility. In that sense, it is essential to define a monitoring plan from theoutset. Each objective must be reflected in one or more indicators that are updatedregularly and are associated with an adequate correction of disparities. Such anapproach must be supported by the use of monitoring tools that everyone can use.These processes will facilitate communication with management and allow truetransparency.

Further to this study, the actions to be performed in relation to the performancemonitoring and assessment factor are:

. Be transparent with top management.

. Define a monitoring plan at the start of the project, specifying the monitoringmethodology, reports, modifications and validation, among other things.

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. Establish performance review and gap correction processes.

. For each objective, define an indicator that will make it possible to measureprogress.

. Put in place tools and quick updating practices for the register of tasks to beperformed.

. Favor project monitoring tools that all participants can understand.

Project championThe champion plays a key role in the project. Ideally there should be only onechampion, who may be accompanied by one or more other sponsors in very largejobsites. This person must obligatorily be a member of top management, which willallow him or her to give the project appropriate support.

The project champion factor is based on the following actions:. Involve the champion(s) in conflict resolution.. Appoint a champion(s).. Ensure that the champion(s) is a (are) member(s) of top management.. Ensure that the champion(s) is available.. Formally define the champion’s (or champions’) level of authority.. Involve the champion(s) in every stage of the project.. Train the champion(s) beforehand on the impacts and objectives of the

implementation.. Ensure that the champion(s) will promote the project throughout the

organization.

Organizational structureThe audit of the organization structure should play a more important role, especially inthe earliest days of the implementation, but this phase is often neglected. Managerstend to consider that an ERP must be capable of adapting to any structure. However, itwill definitely be necessary for the main project’s stakeholders to initiate a thoroughreflection about the changes the system may require and/or bring about from anorganizational perspective.

The only action to be retained for the organizational structure factor is: ensure thatthe structural constraints of the implementation and the business’s strategicorganizational plan are aligned.

End-user involvementMany ways in which end-users should become involved were proposed, as eachrespondent had specific suggestions. It should be recalled that one preliminary actionis crucial: a training plan must be defined, bearing in mind the users’ know-how, theirneeds, technology, etc. Beyond training, it is important to get users involved during thedevelopment of the system and to make use of their knowledge in areas where the teamlacks expertise. It is necessary to be transparent with them concerning the realcontributions the system will make. Finally, training must start at a time that will

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enable it to end when the project goes live; snowballing training provided by key usersis appropriate in this case.

At the end of the study, the actions supporting the end-user involvement factor are:. Define a training plan that takes account of users’ knowledge and their needs, the

technology to be implemented, the trainers’ experience, the chosen strategy, etc.. Dispense training in two steps: overview early on in the project and detailed as

the go-live approaches.. Identify ways of getting users involved during the development of the system. Collect and integrate users’ requirements.. Ensure that users are properly involved in processes where the project team does

not possess all the necessary expertise.. Ensure that trainers or the training team have a good knowledge of the software

and operations.. Carry out formal information activities for users concerning the contributions the

new system will make.. Plan training so that it will end before the application is launched, apart from

small upgrading sessions.. Set up activities so that users will be involved in BPR.. Choose the most experienced trainers available.

Knowledge managementThe last factor, knowledge management, will find a place for itself in a climate thatfavors the exchange of information within the team and the company. As many peopleas possible should be trained by the consultants so the company can becomeautonomous in using the software package.

At the end of the study, the knowledge management factor is characterized by thefollowing actions:

. Create a climate propitious to the exchange of information within the projectteam.

. Have as many people as possible trained on the new system by the consultants inorder to gain sufficient autonomy.

. Promote interpersonal exchanges throughout the organization.

. Define a support program with the consulting firm.

. Collect as much of the organization’s undocumented knowledge as possible(especially from the workers).

ConclusionERP implementations have always been extremely complex projects that are verydifficult to control. Despite an abundant body of literature, one cannot alwaysguarantee that an implementation will be commissioned on time, on budget and withthe quality level that was initially envisaged. Critical factors soon stood out as apromising approach that can apply to all ERP projects. Nevertheless, it was impossibleto easily distinguish how they should manifest themselves in a project manager’s

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everyday practice. This is the particular problem set to which we have made acontribution, filling gaps of the CSF approach identified in some publications (Finneyand Corbett, 2007) to be filled.

In order to integrate CSF management into project execution, we propose the ACSFmethod. It favors the learning of actions, planning, execution and monitoring ofactions, communication supported by actions, and vigilance for the difficulties, withthe goal of strengthening project mastery. This method is based on the translation ofthe CSFs for ERP implementations into a series of actions that are indispensable inorder to maximize the project’s chances of success, presented for the first time here; theother basis is the difficulties encountered during these projects.

What are the indispensable activities, which we call actions, that a project managermust perform in order to maximize an ERP implementation’s chances of success? Weproposed to answer this question in two steps. First, a wide-ranging literature reviewcovering each area of expertise was carried out. Then, we submitted our initial resultsto the judgment of a panel of experienced ERP project managers. This validation bythe professionals made it clear that certain imperatives, which they had encountered,were not covered in most, or any, of the literature.

The approach that we used has its limitations. The list of actions was validated by asmall number of professionals. A study with more participants would have allowed usto obtain more accurate results and more usable weightings. However, the majority ofthe respondents come from the consulting sector and most of them had experienced aconsiderable number of implementations. In addition, since no particular sector wastargeted, the results are, a priori, applicable to most ERP implementation projects.

This study makes a theoretical contribution. By proposing a new approach, whichcomplements the information contained in the literature with a study carried out withprofessionals, the study of CSFs was enriched. The work carried out also has apractical scope: the principles of the ACSF method directly affect all actors in ERPprojects and gives them practical results that they can apply immediately.

Finally, the actions and difficulties identified, as well as the CSFs themselves, applyto ERP implementation projects. It is possible to find similar approaches in other areasof project management research, since some CSFs are recurrent. The ACSF methodcould therefore be adapted to these different sectors. Since project life cycles areaccelerating, implementation periods become more and more decisive, making itcrucial to manage CSFs appropriately, and to do so right from the start.

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Appendix

Factors Difficulties

1. Project teamwork andcomposition

Lack of staff members with experience of previous implementationsDifficulties building and retaining a team that possesses ERPknowledge, given the labor marketDifficulties mastering expertise from outside the businessLack of encouragement, transfer of power or feedback to the projectteamComposition of the team does not represent the various departmentsStagnation in roles and lack of training

2. Organizational cultureand change management

Difficulties moving towards a structure appropriate for the ERP Lack ofexpertise in change managementInflexible organizational structure, processes and personnelUser resistance to the new systemOrganization that is incapable of adapting or refuses to make thenecessary changes

3. Top management support Lack of management participationLack of accountabilityExecutives not involved in achieving objectivesInappropriate management of decision-making policyInadequate problem-solving processesFailure to use the software to improve organizational performance

4. Business plan andlong-term vision

Lack of understanding of the previous system’s capacities andlimitationsVision of the ERP as a simple software application

5. BPR and customization Excessive reengineering efforts resulting in an overly burdensomereconfigurationDecrease in the system’s contributions to optimization and reengineeringeffortsFailure to construct and communicate appropriate business casesFailure to exploit the software’s capacities in reengineeringDifficulties integrating the ERP into the other systemsDifficulties modifying the software to suit the organization’s needsLack of functionalities in the software

6. Effective communication Conflicts of interest among the different departmentsLack of communication among the departmentsLack of communication among the different project teams withindepartmentsLack of communication among teams and usersRefusal of changes requested by other departmentsFailure to understand the side-effects of the integrationIncrease in organizational conflictsPoor communication among the different sitesLack of communication between team members and consultants

7. Project management Lack of planning or clear strategy for the implementation and changesFrequent changes in requirementsFeelings that sacrifices are being made in order to meet deadlines

(continued)

Table AI.Critical ERP factors andrelated implementationdifficulties

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About the authorsOlivier Francoise graduated from ENSAM-ParisTech (France) as a Mechanical and IndustrialEngineer. He then moved to Canada and received a master’s degree in Project Management fromEcole Polytechnique de Montreal. Back in France, he was hired by an insurance company as aproject manager in order to lead several IT and organizational projects: from initiating to closingprocesses through planning and execution. Now, he works as a consultant in InformationSystems Strategy & Transformation. Olivier Francoise is the corresponding author and can becontacted at: ofrancoise@gmail.com

Mario Bourgault started his career as a project engineer and held various positions in privateand public organizations. He then moved on to an academic career after completing his PhD

Factors Difficulties

8. Software development,testing, andtroubleshooting

Difficulties teaching how to use the new systemThe system cannot be easily updated to adapt to changing needsThe frequency of software updates complicates the development of thesystemLack of resources needed for the maintenance and repair of the systemErrors discovered in the data transferInadequate support systemMaintenance employees are not trained properlyMany errors in the final system are neglected due to a poor testingstrategyDesired functionalities are sacrificed to respect deadlinesLack of functionalities in the softwareThe project team is dissolved before all the problems are solvedPoor documentation of the system, especially for design and controlsDifficulties creating reportsLack of reports requested at the time of the launchInappropriate processes that can result in poor system functioningPoor management and configuration of authorizations, resulting insecurity problems

9. Monitoring andevaluation of performance

Lack of appropriate follow-up and monitoringLack of appropriate indicators for following up and assessingperformance

10. Project champion Lack of leadership from managementPolitical difficulties resulting in a negative impact on the project

11. Organizational structure Difference in working styles among different project participantsDifficult integration due to the multitude of original proprietary systemsUnder-optimization of the system configuration due to multi-siteimplementationImpossibility of integrating the ERP into certain proprietary systems

12. Knowledge management Lack of internal staff with extensive knowledgeInsufficient effort to develop organizational knowledgeProblems with information sharing in the project teamDecision-making difficulties due to the lack of knowledge beyond asingle module

13. End-user involvement Inappropriate involvement by staff members from several departmentsLack of consultation with the operational level resulting in a failure tounderstand their needsLimited training that does not cover all daily operations and problemsTraining difficulties

Sources: Chang (2004) and Kim et al. (2005) Table AI.

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studies in Management of Technology. He is now an associate professor at the Department ofMathematics and Industrial Engineering of Ecole Polytechnique de Montreal. He is the head ofhis institution’s graduate program in Technology Project Management, and also heads up theCanada Research Chair on Technology Project Management. His current research interestsinclude project management in virtual teams, collaborative technologies, and distributedinnovation processes. He is an active member of the Project Management Institute.

Robert Pellerin is an Associate Professor in the Department of Mathematics and IndustrialEngineering at Ecole Polytechnique de Montreal. He holds degrees in Engineering Management(BEng) and Industrial Engineering (PhD). He has practiced for more than 12 years inreengineering projects and ERP systems implementation including ten years as a projectmanager. His current research interests include enterprise system adoption, implementation, andintegration.

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