Earlier this year, we examined the key roles that product, partner, and process play in ERP implementations. Here we home in on scalability as a predictor of rollout success.
In 2011 the German supermarket chain Lidl decided that it needed a new merchandise management system to track its increasingly complex business processes. The Lidl SAP project was an ambitious transformation project, and expectations ran high. The plan was to roll out the system to 10,000 stores and 140 logistics hubs.
Fast forward 7 years. In July 2018 Lidl announced that it was cancelling its SAP implementation project after spending 500 million euros. 1200 people had been working on the project for 7 years.
Unfortunately, some seem to believe that the ERP market has moved beyond the worst disasters. Lidl’s experience tells us otherwise. According to Panorama Consulting, 26% of 2016 ERP projects ended in failure.
We must face a difficult truth: ‘cloud’ doesn’t cut it.
Too many organizations treat the ‘cloud’ label as though it can guarantee against a failed implementation. But ‘cloud’ is a poor choice for predicting rollout success.
First, even true cloud solutions require the customer’s cooperation. If your employees and executives refuse to adopt a new ERP system, then your implementation will fail. This applies to the cutting edge as well as the old guard. No software can force you to use it, no matter how advanced it is.
Second, an alarming number of traditional and on-premises vendors have rebranded as ‘cloud’ in recent years. In a process known as ‘cloud-washing,’ they hastily retrofit old products for the new environment. In implementation, upgrades, and support, these applications are much closer to their on-premises heritage than to any cloud paradigm.
But if you can’t trust ‘cloud’ to predict implementation success, then what can you trust?
I would suggest scalability as a potent but underused search term.
Organizations look for scalability when they want to grow. Yet in my experience, scalability has almost as much to do with rollout as with expansion.
Let’s explore this link by looking at one of the market’s most scalable solutions—Xledger.
Scalability in Xledger begins with the data model. Each Xledger customer has an overarching Master level at which they can define their basic configuration. Below this Master level lie regional, vertical market, host, domain, holding, entity, and sub-entity levels.
Configuration at the Master level inherits downward to lower levels. While customers can make deviations at lower levels, they do not have to. Xledger automatically rolls up operational and financial data from lower to higher levels.
What does this mean for onboarding and expansion?
With access to basic setup at the Master level, customers can easily deploy Xledger to new or existing business units. As the customer’s organization grows, Xledger supports localization (of exchange rates, language, etc.) without affecting this structure. Customers can take a global approach from the outset without incurring astronomical costs. There are no separate servers or implementation fees for any new unit. Just training.
Xledger gives decision-makers unprecedented power and flexibility in the rollout process. They can rapidly allocate resources, while their staff can take part from anywhere in the world. Global leaders need only make changes in one place, and those changes will proliferate throughout the solution.
Scalability defines even the structure of Xledger implementations. Customers follow the Xledger Implementation Methodology (XIM) and Xledger Delivery Model (XDM). These standardized frameworks have guided tens of thousands of Xledger customers to success: customers of all sizes and from across a wide variety of industries.
Implementation and growth are inextricably connected. If an ERP product cannot scale without pain, then it will not implement without suffering. Vice versa, a troubled implementation bodes ill for future expansion.
Like dozens1 of companies before it, Lidl learned this lesson the hard way. You shouldn’t have to.