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244 Chapter 9 • Organizational Change and Business Process Reengineering

PREVIEW
Many ERP implementations do not get off to the right start, as shown by the FoxMeyer opening
case. An implementation can be plagued from the beginning by a lack of a vision, a set of unre-
alistic goals that will be achieved by the ERP system, or both. The development of a rationale for
change and communicating it to the company will set in motion a number of activities that will
help with a clear direction and process for moving forward. This was not the case with
FoxMeyer’s ERP implementation. The rationale for changing from legacy systems to an ERP
system is often a result of using business process reengineering (BPR) to streamline processes
and procedures, thereby creating a competitive advantage. FoxMeyer’s would have been served
better by taking more time in the beginning to set the stage for change with their ERP implemen-
tation. ERPs and BPR have become linked over the years. ERP vendors have worked to include
“best practices” in their system within a given industry, whereas BPR identifies current processes
and the change requirement to implement “best practices.”
Although BPR is used to assess the organizational process change needed, the
Organizational Project Management Maturity Model (OPM3) will assess the company’s level of
skills and ability to implement an ERP system successfully. OPM3 is relatively new and has the
support of the Project Management Institute (PMI). The OPM3 consists of three steps: knowl-
edge, assessment, and improvement. These will be presented in more detail in this chapter.
Beyond BPR and OPM3, the project organization and roles and responsibilities will start to
bring the project into clarity for the business. ERP implementations require their own organizations
and reporting structure. Reporting lines, expectations, and even evaluations need to be included in
the structure. Staffing the organization with existing staff, new hires, and consultants creates the
need for the project management office to develop a sense of teamwork. Teamwork often takes a
number of years to develop under normal circumstances. With ERP implementations, the sense of
team needs to be something that is addressed early and quickly on a project and will need to be
worked on throughout the implementation. The continuity of teams during the implementation
helps to ensure that there is a basis for moving forward as decisions are made and business processes
change. If an implementation does not have continuity, as found in the FoxMeyer example, it can
lead to a lack of understanding of how business processes were changed and why.

REASON FOR CHANGE
What’s “Organizational Change?”
Typically, the concept of organizational change is in regard to organizationwide
change, as opposed to smaller changes, such as adding a new person, modifying a
program, etc. Examples of organizationwide change might include a change in
mission, restructuring operations (e.g., restructuring to self-managed teams, layoffs,
etc.), new technologies, mergers, major collaborations, “rightsizing,” new programs
such as Total Quality Management, re-engineering, etc. Some experts refer to it as
organizational transformation. Often this term designates a fundamental and radical
reorientation in the way the organization operates. 2

2 Organizational Change and Development (includes the Field of Organization Development) Written by Carter
McNamara, MBA, PhD, Authenticity Consulting, LLC. Copyright 1997–2007. Adapted from the Field Guide to
Consulting and Organizational Development and Field Guide to Consulting and Organizational Development with
Nonprofits.