Why Most Software Implementations Fail - Part 1
“We all see it. We all see it.”
- Dr. Rick, Progressive Insurance Self-Help Coach
Introduction
It’s a well-worn comment that most software implementations fail, and throughout this two-part series, we’ll look at why. Business owners know all too well the pain of waiting weeks, months, and sometimes even years for a brand-new software implementation only to be disappointed by the result. To help you avoid becoming one of them, we’ve compiled these five common denominators.
Insufficient Planning
The latest Standish Group Chaos Report found that of 50,000 software developments, only 29% were successful. 52% were challenged and 19% were outright failures. Among the larger companies, success rates were down to 9%.
One of the primary reasons for software implementation failures lies in inadequate planning. Rushing into an implementation without a comprehensive understanding of organizational requirements, goals, and potential challenges sets you up to fail.
The most critical aspect of technology acquisition is multi-dimensional requirements capture (“MDRC”). MDRC is the process of capturing requirements for a specific Line of Business and then ensuring that those requirements transcend other lines of business and comply with data governance.
For example, the finance team might want an ERP, but does not think through the requirements of integration with a web commerce front end. The marketing team wants a CRM and does not think through the requirements for an ERP or a web commerce front end. Sales teams might want a great web front end, but fail to think about how they link to CRMs and ERPs. All three acquire their software in a silo and now customer data exists in three places, none of which is a system of record.
This ultimately leads to one or more lines of business having to scrap an implementation or having to pay exorbitant fees for integration. Ultimately, you run the risk of nobody getting exactly what they need out of the software.
Lack of User Involvement and Training
Successful software implementation requires the active participation of end-users throughout the process. organizations often neglect to involve key stakeholders, leading to a lack of understanding and acceptance among the users.
According to the Science and Information Organization, user resistance is one of the top causes of failure in the implementation of information systems in organizations.
In many cases, users forget that not everyone will have the same level of technical knowledge and expertise. The team that is executing an RFP or implementation is often what’s known as power users, which means their knowledge about the line of business or certain interfaces is well beyond the average user. In addition, there is very little thought given to how a new implementation will disrupt current process workflows. We are all creatures of habit and enjoy routine. Most employees can only consume disruption at very small incremental rates.
An implementation that does not engage users from the beginning may lead to a solution that might not align with their workflow processes. It causes resistance to change, low adoption rates and the creation of so-called ‘hidden factories’. These are workarounds developed by a single employee that makes their job easier, but does not consider the downstream effect on others.
Hidden factories only work as long as the employee is at your company. Once the employee leaves, it may take weeks or months to discover these factories and it usually culminates in a crisis.
This often happens in software functions shared between two teams. A very common problem is the booking of orders through tools like SalesForce between a finance and sales team. In simple terms, the sales rep books the order in SalesForce. The finance person picks up the order to process in QuickBooks. However, he or she can’t get the right data view out of SalesForce, so, the finance person creates a spreadsheet full of “hidden factory” calculations. Nobody on the finance team knows of this spreadsheet workaround. When the employee leaves, the next finance member encounters the same problem and makes another workaround. Now you have two workarounds with slight variations. The result will be inaccurate financial reporting six months after the employee left and another six months of forensic accounting to fix it.
In addition to workflow disruption, insufficient training is another common stumbling block. Organizations may underestimate the time and resources required to educate users on the new software. Without proper training, users struggle to navigate the system, leading to errors, decreased productivity, and frustration.
Conclusion
In this first part, we discussed two of the most misunderstood reasons why software implementations fail such as a lack of planning, user involvement and training. In our second part, we’ll discuss how how scope creep, poor communication, and technology compatibility also need to be overcome to have a successful software implementation.
ABOUT THE AUTHOR
A technologist, entrepreneur, and focused IT strategies leader, George builds scalable platforms and businesses. With expertise in network & server architecture and implementation, multiple programming languages, and product design, George’s comprehensive knowledge of web‐based technologies informs the strategic direction of funded startups to fortune 500 companies looking to change the future of business through digital technologies.
About Brian Timothy and Associates LLC
Brian Timothy and Associates, provides medium sized businesses with fractional expertise to help them grow and improve. Using our expert consultancy, we’ll bring focus, experience and proven results to help take you onto the next better. Unlike other companies we are transparent and follow through on our promises. We don’t bill endlessly. We don’t pass the baton and we won’t be opaque in our pricing. You’ll see clearly what you get and what you pay for.
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