Can Agile Practices Prevent ERP Disaster
A recent Computer Weekly article reported on Nov 3, 2011 that the U.S. Military is moving towards open standards and agile practices for it's ERP implementation after running into significant headwinds with current vendors. According to the article:
“It is nearly 10 years since US military divisions followed the millennial trend in public computing by pooling their purchasing and embarking on the ambitious, clean-slate replacement of hundreds of business systems with all-encompassing Enterprise Resource planning software.
Then they followed the ERP trend of going years over-schedule and billions of dollars over-budget.
Now the Department of Defense claims it is going agile, adopting open standards and embracing the semantic web. “
Elizabeth McGrath, deputy chief management officer at the Department of Defense, in her testimony to the U.S. House of Representatives stated:
"Through the next release of the [Business Enterprise Architecture], we will apply open standards and protocols to architecture development, leveraging Semantic web technologies, common business process modeling approaches, and agile development methodologies,"
ERP implementation failures are well known and documented in the information technology field. CIO magazine ran an article on 10 famous ERP system implementation failures in 2009. Computer World UK also ran a list of ERP disasters. All of this points to the difficulty around implementing ERP systems. But is the U.S. Military's use of agile practices a solution with precedent or just wishful thinking?
The Guerilla Project Management blog has some conversation around the topic of using agile practices in ERP implementations. According to the case study an SAP system was delivered to a client using agile practices and resulted in completion ahead of schedule.
According to the case study audio interview with Jason Fair, CEO of Genesis Consulting:
“...the amount of time we actually spend on customer value add activities was so small.”.
Jason estimated that under traditional waterfall process implementing ERP they spent no more than 5-10% on client value added activities. By boosting this to just 20% they would achieve significantly better value to their client.
Chose a suitable first trial project with a trusted business customer, a real problem and challenging timescales.
According to Kamanraj Shankar:
Agile methodology can be applied for large & complex ERP implementations. Typically ERP implementations used Waterfall or vendor/implementer specific methodologies, which had phases such as Requirement, Blue Print, Build, Test/Train an Deploy.
Bill Wood had a different view:
To the points raised here, "Agile" according to the definition in the "Agile Manifesto" is a complete and total disaster on large ERP projects.
The success of the U.S. Military's new direction for ERP implementation is not known yet. But, the business world has grown tired of ERP project failure and new approaches are being explored as a result. So what do you think? Will agile save companies from ERP disasters?
Every ERP vendor already has its own project methodology