The struggle of implementing information systems

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Hi all, this week I have looked into the implementation of information systems in business. Although you may see this as an upgrade for a company, there is also many struggles they face when imposing these systems. 



1. Inadequate Training
Training should be one of the most important factors when implementing new software. Employees need to understand how to utilise the software for the day to day running of the business. The project team must communicate frequently and accurately with employees by making an on - boarding plan to get employees up to speed and to use the features with confidence. An example of this process not being carried out correctly is with Nike and their supply chain issues in 2021. They stated that their employees were not adequately trained before the system went live. With some other software issues, this caused Nike to lose $100 Million + in revenue as well as lawsuits and a 20% drop in stock.


Related Nike article: Nike Supply Chain Issues

2. Misaligned Expectations 
The software vendor needs to be honest and transparent about what they can realistically deliver. If the vendor sets out a clear deadline of when their systems will be implemented, they must follow this as accurately as possible or it will create disruption. Also if the company was under the illusion that the software had a desired capability but turns out not to be the case, can create serious productivity issues down the line. An example of this is Tri Valley who purchased $6 million worth of ERP services from Oracle in 1996, which lead to a lawsuit of $20 million as none of the software worked as promised. This left Tri Valley with a net loss of over $30 million.

Related Tri Valley ERP article: Tri Valley Lawsuit


3. Lack Of Planning
A lack of planning regarding implementing information systems can cause many issues such as lost business, low team morale, poor quality products or services being produced, and much more. A big example of this is FoxMeyer implementing an ERP system from SAP worth $65 million. The planning involved was extremely poor as they selected a poor ERP system with no consideration of other consultants advice and no end user involvement. The total disaster bill was over $100 million and the company had to file for bankruptcy a few months later.

Related FoxMeyer ERP article: FoxMeyer Poor ERP

In conclusion, put a lot of time and research into implementing new information systems as it is not as easy as it may sound!! Any other major failures of ERP? let me know in the comments!!!!💬

Comments

  1. Shauna O'Leary7 December 2023 at 02:04

    Great Read!!!!

    ReplyDelete
  2. Alex O'Connor7 December 2023 at 12:05

    Very interesting!

    ReplyDelete
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