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Q7-6 What Are the Challenges of Implementing and Upgrading Enterprise Information Systems?

Q7-6 What Are the Challenges of Implementing and 309
Upgrading Enterprise Information Systems?

Implementing new enterprise systems, whether CRM, ERP, or EAI, is challenging, difficult, expen-
sive, and risky. It is not unusual for enterprise system projects to be well over budget and a year or
more late. In addition to new ERP implementations, numerous organizations implemented ERP
15 or 20 years ago and now need to upgrade their ERP installation to meet new requirements.
If you work in an organization that is already using enterprise systems, you may find yourself
engaged in a significant upgrade effort. Whether from a new implementation or an upgrade,
expense and risks arise from five primary factors (see Figure 7-17).
Collaborative Management

Unlike departmental systems in which a single department manager is in charge, enterprise systems
have no clear boss. Examine the discharge process in Figure 7-7; there is no manager of discharge.
The discharge process is a collaborative effort among many departments (and customers).
With no single manager, who resolves the disputes that inevitably arise? All of these depart-
ments ultimately report to the CEO, so there is a single boss over all of them, but employees can’t
go to the CEO with a problem about, say, coordinating discharge activities between nursing and
housekeeping. The CEO would throw them out of his or her office. Instead, the organization needs
to develop some sort of collaborative management for resolving process issues.
Usually this means that the enterprise develops committees and steering groups for providing
enterprise process management. Although this can be an effective solution, and in fact may be the
only solution, the work of such groups is both slow and expensive.
Requirements Gaps

As stated in Q4, few organizations today create their own enterprise systems from scratch. Instead,
they license an enterprise product that provides specific functions and features and that includes
inherent procedures. But such licensed products are never a perfect fit. Almost always there are
gaps between the organization’s requirements and the application’s capabilities.
The first challenge is identifying the gaps. To specify a gap, an organization must know both
what it needs and what the new product does. However, it can be very difficult for an organiza-
tion to determine what it needs; that difficulty is one reason organizations choose to license
rather than to build. Further, the features and functions of complex products like CRM or ERP
are not easy to identify. Thus, gap identification is a major task when implementing enterprise
systems.
The second challenge is deciding what to do with gaps, once they are identified. Either the
organization needs to change the way it does things to adapt to the new application, or the
application must be altered to match what the organization does. Either choice is problematic.
Employees will resist change, but paying for alterations is expensive, and, as noted in Chapter 4,

Collaborative management

Requirements gaps
Transition problems

Employee resistance
Figure 7-17 New technology
Five Primary Factors