Whether close up or from a distance, you have probably seen the challenges of an ERP (enterprise resource planning) software implementation. Consultants all over the place, technologists building things out, and training being developed and deployed. They are all essential to any good ERP implementation. With them come costs and delays; without them, you get an ERP system that doesn’t work.
One alternative many companies explore in contract management is their current ERP vendor. “Why not see what they have?” someone will ask. It’s not a bad question. After all, the ERP vendor should already understand your business and your system, and when it is all done, it should integrate flawlessly. Right?
Why ERP systems fail at contract management
Unfortunately, flawless integration is just not the usual case. Some of the challenges of ERP vendor systems include:
- Too complicated
- Drain IT resources to implement
- Take too long to set up
- Consulting costs explode
- Training costs explode
- Changes in workflow are not adopted
That last point is critical. When people refuse to use the system, adoption fails. When adoption fails, people resort to the old way of doing things. Why? Because the old ways worked and they are still perceived as simpler, easier and faster. And usually, they are.
The reasons why ERP vendors are a poor selection are straightforward. Most ERP systems:
- Are overbuilt, thereby enabling them to do things people will never use them for
- Take too long to implement and therefore don’t meet the urgent needs of overwhelmed contract managers
- Are very expensive
- Require a complete overhaul in the workflow, which creates confusion, challenges, and extensive risk
An easier solution
While it may appear that a company’s ERP vendor is the way to go, most companies find that a solution built to manage contracts and mirror the existing workflow is much easier to implement, gains acceptance and adoption faster, and has a positive impact sooner.
To learn more about different types of contract management systems, read our complimentary white paper, Finding the right contract management system: What are my options?