ERP and Organisational Change Management
Abstract
Change has turn into an unending event and business process
re-engineering has turn out to be a prerequisite for continued
existence of organizations as we approach the 21st century. As
participants in this ever-changing operational environment, we must be
ground-breaking in managing change as it affects both our professional
and persona lives. One of the innovative ways to manage change in the
implementation of an enterprise resource planning (ERP) system is to
adopt a comprehensive change management methodologies. The purpose of
this paper is to describe how the change management is crucial to ERP
implementation and to illustrate how the methodology can be used to
implement successful change.
Introduction
============
Although most organizations have come to realize the benefits of using
testing procedures and tools during an ERP implementation, many
companies recognize the need for change-management support in their
projects. IT organizations need solid support for a number of critical
procedures that change-management practices provide, including version
control to manage the large number of modifications made throughout a
The Essay on Change Management in the Learning Organization
In this paper I intend to discuss change management approaches that support the learning organization philosophy. The learning organization is defined as an organization that acquires knowledge and innovates fast enough to survive and thrive in a rapidly changing environment. Learning organizations (1) create a culture that encourages and supports continuous employee learning, critical thinking, ...
project, audit trails to keep well-documented records of those
modifications, process and workflow control to define, coordinate, and
control the steps within a project and issue tracking to keep all
project members informed of changes and problems that develop.
Identifying, tracking, assessing the impact of and migrating changes
in Enterprise Resource Planning is a significant challenge. Whether
organizations are developing Customizations, building extensions or
upgrading to a new release, it is time-consuming to manage changes
while safeguarding the stability of the systems. Changes also
frustrate one of the most valuable business resources. Developers
would rather be creating new application features for the business,
not re-doing the old ones. The objectives of this paper comes from the
brief that the Change management is essential to ERP implementation
and describes the strategies that have been adapted by the companies
in an attempt to implement successful change.
CHANGE MANAGEMENT
—————–
The first and most obvious definition of “change management” is that
the term refers to the task of managing change. The first meaning of
managing change refers to the making of changes in a planned and
managed or systematic fashion (Ricky ,1990) . The aim is to more
effectively implement new methods and systems in an ongoing
organization. The changes to be managed lie within and are controlled
by the organization. However, these internal changes might have been
triggered by events originating outside the organization, in what is
usually termed “the environment.” Hence, the second meaning of
managing change, namely, the response to changes over which the
organization exercises little or no control (e.g., legislation, social
and political upheaval, the actions of competitors, shifting economic
tides and currents, and so on).Change is every where, change is
inevitable, and that dealing successfully with change is critical
The Term Paper on Controlling Processes
Multiple Choice 1. Which of the following is NOT a problem commonly found when monitoring? a) Organizations collect data that are easily gathered b) Gathered data are not the most important to reach the organization’s goals c) There is an undue emphasis on measuring objective output performance d) Inputs measurements are used as a proxy for output completion Answer: c Difficulty: Hard Response: ...
(Ricky ,1990) . Communications-technology spectrum, corporate managers
are introducing new efficiencies. All people in the organizations are
concerned and involved with change irrespective of the small scale or
large scale organizations, such as change or strategy with subsequent
changes in structure and operations or change of version of software.
Causes of Change
Forces for change within an organization are frequently the result of
some external force. It is also certain that organizations that do not
respond to triggers such as increasing competition, new legislation or
the expectations of customers will soon decline and may cease to
exist. However, in addition to bringing about change in the internal
environment, organizational personnel can, to some extent, influence
factors external to the organization. For instance, to follow on with
the example of government policy towards higher education, the setting
up of government committee to consider the shape and future of higher
education gives an opportunity for managers of universities and other
interested organizations to lobby committee members, politicians, the
media and others and thus influence the committee’s findings on the
future and form of their organizations (Barbara,1997).
This process is
shown in Figure 1.1 it is an example of the use of the control model
concept to depict the inputs to and out puts from an organizational
process.
INPUTS OUTPUTS
Process for
lobbying the government
[IMAGE][IMAGE][IMAGE][IMAGE][IMAGE]HIGHER Ideas Lobbying MPs POLITICAL
[IMAGE][IMAGE][IMAGE]EDUCATION Willingness Proposals to committee
ENVIRONMENT
[IMAGE][IMAGE][IMAGE][IMAGE]SECTOR to lobby Publicity through media
[IMAGE]
[IMAGE]
[IMAGE]
[IMAGE][IMAGE][IMAGE]HE Goals Feedback from outputs to modify inputs
* Increased resources
* Recognition of importance
of the sector
* Expansion of the sector
Figure 1.1:Control model of a process for influencing government
policy towards higher education
( Source : Barbara 1997,p.24)
The Coursework on Managing Organization with Wide Change in Hierarchical Organization:
“It is not the strongest of the species that survive nor the most intelligent but the one most responsive to change” - Charles Darwin In a world of new technologies, transforming economies, fluctuating consumer preference and dynamic competition, it is not a question of whether firms should change but rather when, where and how they should change. While change could be seen everywhere not all is ...
In this case,it illustrates how information on the effects of the
outputs is fed back to be compared against the goals of the process
owners . The results of this comparison are then used to modify the
inputs to the process which in turn change the outputs to bring them
more in line with the achievements of the goals.
Literature Analysis
===================
According to the views of Pettigrew and Whipp(1993) change may be
constant but it is not always the same. A preliminary point for
considering the nature of change experienced by organizations is
Grundy’s three ‘varieties of change’ (Grundy, 1993), as shown in
Figure1.2. Grundy states that many managers perceive change as a
homogeneous concept, while others describe change as being primarily
the enemy of stability. The first of the main types of change Grundy
defines as ‘smooth incremental change’. Smooth incremental change is
change which evolves slowly in a systematic and predictable way. The
second variety of change Grundy terms ‘bumpy incremental change’. This
is characterized by periods of relative tranquility punctuated by
acceleration in the pace of change. He likens the ‘bumps’ to ‘the
movement of continental land masses where the fault enables periodic
readjustments to occur without cataclysmic effect'(Grundy, 1993,
p.24).
He says that the triggers for this type of change are likely to
include those from both the external and internal environments and
which are perceived as ‘overload’. Grundy’s third variety of change is
‘discontinuous change’, which he defines as, ‘change which is marked
by rapid shifts in either strategy, structure or culture, or in all
three'(Grundy, 1993, p.26).
The opportunities offered by the
development of the Internet are most likely to lead to forms of
discontinuous change in many organizations. However, not all instances
of discontinuous change are linked to technological innovations.
The Term Paper on Change Management at UNDP India
The country context – past achievements and current challenges Country development scenario and UNDP’s role in it India is a diverse, big and challenging country, with a wide range of economic, social, demographic and developmental scenarios prevailing across its landscape. However, being a social state, its government has always taken on an active role in ensuring the well-being of its ...
Humans are thought of as operating in a kind of field of various
forces, and human behaviour is seen as the product of those forces.
[IMAGE]
Text Box: Desired Future State [IMAGE]
Current
State
[IMAGE] Equilibrium
[IMAGE]
[IMAGE]
[IMAGE] Facilitating Restraining
Forces Forces
[IMAGE]
[IMAGE]
Figure 1.2: Force Field analysis ( Source: Connor and Lake 1994,p.104.)
Management scholars have since applied this field concept to
problem-solving, decision-making, and change-management analysis
(Connor and Lake,1994).
As fig 1.2 indicates, the concept is that a
change situation involves moving from a current state to a desired
state. The force-field view of change management assumes that most
situations are held in equilibrium by two sets of forces: those that
facilitate movement to a new situation and those that restrain such
movement. Under this condition the organization will maintain the
status. When forces in one direction exceed those in one opposite one,
the organization will move in the direction of the greater forces. If
the facilitating forces for change exceed the restraining forces those
against change, then change will likely occur. The force-field concept
is useful because it suggests that identifying and understanding
facilitating and restraining forces can help answer the question of
how best to go about managing change.
CHANGE MANAGEMENT AND ERP
ERP Applications perform some of the most critical business functions
within companies around the globe. Change-management development
practices and software help organizations manage the evolution of
applications throughout the life cycle. IT departments need support
for documenting, managing, and implementing application changes across
heterogeneous systems, especially as ERP solutions start maturing.
This will be even more important for companies that evolve their ERP
systems into platforms for future application development and system
integration. Currently, SAP, Oracle, PeopleSoft and many other
The Research paper on Change Management And System Development In The Gwent Police Force
Case Study: Change Management and System Development in the Gwent Police Force This case study discusses the latest development of the information system used in the Command and Control Room of a Police Force in the UK. Although the new system is extremely powerful it is plagued by fundamental operational issues. It highlights the importance of recognizing the needs of users and other operational ...
companies are introducing internal change-management support within
their ERP systems.
The importance of change-management goes beyond application
development. It also empowers IT personnel to roll back to a previous
version if there are problems with upgrades. Change Management
services, those dealing with the human and organizational change
associated with an ERP implementation, play a key role in the success
of a project. Change management practice, which supports ERP solutions
in addition to other solution areas, continues to evolve its tools and
techniques to address the continuously changing technologies and
complexities of ERP solutions(CGEY,2002).Allan(2001)states during the
ERP implementation process, companies make significant investments in
customizations to adapt the ERP product to their business model. In
some cases, the investment in these customizations can be comparable
to or exceed the original cost of the ERP software. Implementing
Application Changes into these highly complex systems can be both
labor-intensive and error-prone. Change can, however, strain the
capabilities of any Information Systems Organization. Ability to
successfully implement new technologies and business objectives begins
with understanding how prepared the organization is to accept change,
making the necessary changes, and ability to understanding the total
impact of the change on the organization . Currently, many of the
large commercial ERP products have been reengineered for web-based
architectures. Current ERP clients still using the Client/Server
versions are faced with a challenging, upgrade. In these environments,
the best way to manage changeis to be prepared for change, whether
from customizations, patches or upgrades.
Change is a constant in today’s competitive business world. Change can
often be difficult, especially for employees who might not see the
immediate benefit of these changes. By using comprehensive change
The Essay on Customer Relationship Management and Systems
1. What concepts in this chapter are illustrated in this case? Symantec Corporation started out with good intentions. Shortly after acquiring Veritas it began an ERP rollout that was designed to standardize and unify the Symantec and Veritas information systems. The goal was to create a single ERP system, within which all of the company’s extensive network of resellers, integrators, distributors, ...
management strategies and group techniques, the transition to new
technology can be made easy by enabling employees to realize immediate
benefits from a new system. While change is never easy, companies that
have gone live with enterprise systems find themselves focusing more
on customer needs and positioned with the information and tools to
work more closely with suppliers to improve competitiveness. This
often leads companies to quickly add and support more users and
software modules, improve handling of enterprise data by deploying
business intelligence systems, and to begin Internet collaborations
with customers and suppliers (Anonymous,2000a).The ERP application
will enable changes in business processes that can reduce cycle times,
use resources more efficiently, reduce costs or improve customer
responsiveness. However, expected benefits will only be realized when
individuals in all affected parts of the organization are willing and
able to adapt to the new ways of working. Individuals are typically
willing to adapt if they understand the need to change and accept
responsibility to produce tangible business benefits. They will be
able to adapt if the organization is redesigned to align with new
business processes and they are appropriately trained (Anonymous,
2000b).
Version Management and Change Management(VM)
Allan(2001) defines the Version Management and Change Management as
follows.Version management is a well-established concept, Change
Management is fairly new to the IT landscape. In general, Change
Management processes works very closely with Version Management
processes. Many commercial software makers either have a Change
Management product offering or are in the process of developing a
Change Management product. While VM manages the integrity of custom
developed software, many environments may develop or customize
software. Change Management software captures and documents
application changes, originating both from vendor patches and local
customizations. In typical ERP environments, Change Management
software is used to protect the integrity of the operating environment
during software changes, both for commercial and custom developed
software. At the same time, Change Management impact analysis features
provide better approach to managing and analyzing changes across an
applications environment.To Manage The Complexity of Customized ERP
Applications many ERP Application Support groups are faced with the
extremely complex task of managing application customizations while
introducing vendor software patches and new Application Releases. Many
commercial ERP software vendors have reengineered their ERP products
to make them web-enabled. Many of the companies still struggle with
daily support issues and struggle to keep software patches and updates
from breaking other functionality, either custom or standard.
STRATEGIES
SAP R/3 stores all objects and files within internal tables in the
database. Change-management support, including versioning of the
contents of these tables and audit trails, is provided through the
Correction and Transport System. Additional management capabilities
within the Correction and Transport System are provided via the
Transport Management System, which helps transport and manage changed
objects from the development system to the production system. SAP R/3
provides change-management support for system upgrades, specifically
for visually comparing differences between objects via a split-screen
interface. IT organizations have the option of merging the customized
code with the new object or maintaining the modified object within the
new application. SAP provides limited internal issue-tracking
capabilities and there is currently no process-management or workflow
support. Expect to see this functionality added, especially the
process and workflow support, which is key to simplifying and
shortening the time required to manage data through a project and
thereby reduce downtime (Barnes 1999).
According to Orlikowski and Hofman (1997) there are many methodologies
for implementing change. One approach is rather traditional and
stipulates that a team begins with a plan comprised of certain
universal principles. There is considerable effort at ensuring every
aspect of the project runs according to the plan. A more innovative
perspective to the traditional approach is the improvisational change
model . This model is aimed in implementing at the University of
Nebraska (UN) as it seeks to increase its administrative efficiencies.
This example describes and illustrates how the methodology can be used
to manage change in the implementation of SAP R/3 at UN. Based on this
model, the team enacts “an ongoing series of local innovations that
embellish the original structure, respond to spontaneous departures
and unexpected opportunities, and iterate and build on each other over
time” (Orlikowski and Hofman,1997).
The team identifies its objective
then sets off toward the objective, responding to conditions as they
arise and in an improvised fashion. Efforts are directed at reaching
the objective rather than following a plan.
The Improvisational change model
The improvisational change model which was proposed by Orlikowski and
Hofman(1997) recognizes three types of change:
* Anticipated changes are those that are planned ahead of time and
occur as intended.
* Emergent changes are those that arise spontaneously from local
innovation and that are not originally anticipated or intended.
* Opportunity-based changes are not anticipated ahead of time but
are introduced purposefully and intentionally during the change
process in response to an unexpected opportunity, event or
breakdown.
Assumptions made by this model is that the changes related with
technological implementations comprise an continuing process
relatively than an event with an end point after which the
organization can look forward to return to a sensibly steady state,
and all the technological and organizational changes made during the
ongoing process cannot, by definition, be anticipated ahead of time.
This improvisational model also assumes there will be road bumps along
the way to reaching the objective.
The uniqueness of the model is the flexibility to transform some of
the obstacles into positive emergent and opportunity-based changes
that will enhance the overall effectiveness of the organization, and
the acknowledgement that emergent changes exist and that they have a
profound effect on enterprise-wide implementations.
The Recurring Improvisational Change Methodology
According to the views of Orlikowski and Hofman (1997), the recurring
improvisational change methodology, which is an expansion of the
improvisational model proposed is a useful method for identifying,
managing, and tracking changes in implementing enterprise-wide
systems. It employs a diagrammatic method to outline the recurring
levels of anticipated, emergent, and opportunity-based changes that
arise in the implementation of enterprise-wide systems.
ERP effort was being undertaken at UN to improve the University’s
administrative processes through a customization process using the SAP
R/3 software. University-wide steering committee – the Financial
Systems Task Force (FSTF) – was created and given the responsibility
for the overall management of the project scope, funding, direction
and business issues. The FSTF also served as the initial change
agents. The FSTF later created Campus Transition Teams to serve as
liaisons between the ERP end users and the ERP development teams. The
Transition Team members were empowered to lead the project as change
agents (Michelle 1997).
[IMAGE]
Figure 1.3 :IT Indicates some of the changes that have occurred at UN
since the initial SAP planning phase that began in 1997.
(Source: Michelle ,1997)
University has realized two major opportunity-based changes emanating
from the larger anticipated change of implementing the ERP system: the
formation of business centers, and the development of a comprehensive
knowledge management system. opportunity-based changes tend to lead to
more opportunity-based changes, which should lead the organization to
greater success. Figure 1.3 distinguishes the recurring changes and
how one change leads to another. application of this methodology, will
expand on two opportunity based changes emanating from the SAP
implementation at UN: the development of a comprehensive knowledge
management system, and the formation of business centers. These two
opportunity-based changes have and will continue to lead to several
levels of anticipated, emergent, and opportunity-based changes.
Development of a knowledge management system for supporting SAP
implementation leads to providing opportunities for more efficient
on-line help (an opportunity-based change), rather than traditional
hard copy manuals. The formation of business centers, which itself is
an opportunity-based change, leads to other opportunity based change
(Michelle 1997).
Case Study
Oracle Corporation
Oracle provides change-management support within the Application
Object Library–the repository in which all program files, reports,
and forms are registered. The Application Object Library stores all
revision information and displays log files to help organizations
determine which patches have been applied and whether or not they were
successful. The Application Object Library also provides support for
tracking every version of a file and the particular patch builds in
which those files are included, as well as support for analyzing
developer-tested patches, recording the configuration, and building
the patches on multiple hardware platforms. Within the Application
Object Library, the Auto Patch utility can be used to confirm that a
particular patch is appropriate for a specific installation. It helps
organizations determine the versions of customer files and database
objects currently installed and compares these with the versions being
delivered via the patch. DataMerge is an installation utility that
uses an algorithm to determine if data to be patched has been
previously modified. If so, the tool will preserve that data as part
of the upgrade. Oracle is expected to continue to focus on the upgrade
process with its change-management tools. Oracle provides little
change-management support for managing an initial implementation or
ongoing customizations (Barnes 1999).
Allan (2001) defines the concept as Application Change Management(ACM)
Application Change Management is a process created to address the
issues related to customizing pre-packaged applications. At the same
time, ACM can help analyze and prepare for vendor software upgrades
and patches. ACM systematically and accurately captures the changes,
and dependencies, related specifically to the ERP customizations.
Given the magnitude of the investment, both in the ERP software and
the customizations, a company needs to consider how to preserve their
total ERP investment. ACM provides a better approach to managing local
customizations created to support a company’s unique business model,
and avoid unplanned outages during ERP upgrades.
The concept of ACM is fairly simple: Identify what has changed within
an object (as compared to that object’s previous state).
Identify
other objects, which may have dependencies upon this initial object.
Understand the internal structure of the application database and
program objects, i.e., their various characteristics and properties.
Once the change dependencies have been identified, the knowledge of
these changes is conveyed to managers and developers so they can
easily evaluate which changes are significant, and which can be
ignored (Allan 2001).
Conclusion
———-
Change is about nothing if it is not about perseverance. This means
persisting in the face of an a-unstable environment; persisting in the
face of systems which are built for stability rather than change;
persisting in the face of plans which are out of date as soon as there
are formed. It means applying the same principles to people as are
applied to ‘things’ that is, the knowledge that nothing is perfect.
This means recognizing that people will act in infuriating and
annoying ways but that, when necessary, will bring the genius of their
humanity to solve apparently unsolvable problems. Many ERP vendors are
addressing the need for change-management support within their
applications. These vendors appear to be taking change management far
more seriously, especially as ERP implementations take on greater
significance within organizations. Change is not easy but it can be
interesting. Change management is a necessity in supporting ERP
implementation. Without change management, too much time and money
will be spent manually carrying change forward, synchronizing the
environments and resolving day-to-day problems.It is certainly worth
the journey even if the place of arrival is surprising.
References
==========
Allan.Hooks(2001),Oracle ERP Change Management Project Whitepaper,
http://www.oracle.com/collateral/cmowhitepaper.pdf.
Anonymous(2000a),IBM Global Services Australiamakes ERP spell ROI with
new Extended EnterpriseServices,
http://www.ibm.com/news/au/archive/erp.shtml
Anonymous(2000b), IBM Business Management Services/ERP: ERP
Organization Change Services,
http://www-1.ibm.com/services/collateral/erp_org.html.
Barbara Senior. (1997) Organisational Change, Pitman, Great Britain.
Barnes Michael(1999), Customization Of ERP Apps Requires Development
Skills, http://www.informationweek.com/722/22iuerp.htm.
Connor, Patrick E. and Lake, Linda K. (1994), Managing Organizational
Change, Greenwood, USA.
CGEY (2002), Extended Enterpriseapplications/Enterprise Resource
Planning,
Grundy T. (1993), Managing Strategic Change, Kogan , London.
Michelle M. Sieber. (1997), A Recurring Improvisational Methodology
for Change Management in ERP Implementation,
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Orlikowski, Wanda J. and Hofman, J. Debra. (1997) An Improvisational
Model for Change Management: The Case of Groupware Technologies, Sloan
Management Review, 38, no. 2
Pettigrew, A. and Whipp. R. (1993), Management change for competitive
Success, Oxford, Blackwell.
Ricky, W.Griffin. (1990), Management, Houghton Mifflin, Boston.
