What is “ERP Accountability”?
ERP Accountability refers to the concrete measures integrated into Enterprise Resource Planning (ERP) project planning to ensure performance improvement within and among all stakeholder groups of organizations. It encompasses several components and various measures aimed at improving organizational alignment, leadership practices, goal setting, communication, and conduct conducive to achieving performance improvement within organizations undergoing ERP organizational change.
ERP Project Planning Accountability Measures
ERP organizational change projects need to include concrete accountability measures that are integrated into the ERP project planning. Concrete accountability is measurable actions that lead to performance improvement within and among all of the private equity (PE) portfolio organization’s stakeholder groups.
Successful accountability measures can include organizational alignment (structure), leadership practices (agency), balanced scorecard, an iterative process of data collection, and ethics, empowerment and trust factors. Here are N&A descriptions of these accountability measures:
- Organizational Alignment
Organizational alignment is a critical component within merger and acquisition (M&A) activity as organizational change success requires a clear understanding of the concept, definition, role, expectations, realities, and execution of accountability within an organization (Hong & Kim, 2002). The accountability action plan is important because the benefits of a proper accountability structure raise expectations for all strata while also identifying discrepancies in resources, efforts, and practices.
The stratum of accountability stakeholders that exist in the private equity (PE) portfolio typically includes investors, PE firms, portfolio executive team, subject matter experts and implementation team, upper management, middle management, and workforce teams. Anecdotal evidence, case study, and research suggest that accountability is often a challenge within strata in terms of misjudging and miscalculation of capabilities, constraints, values, information, and action (Hentschke & Wohlstetter, 2004).
Each of these stakeholder groups often consists of a large degree of diversity in terms of experience, knowledge, motivation, expectations, and resources needed for an ERP organizational change endeavor. Meaningful accountability consists of learning, teaching, knowledge, and adequate and appropriate resources. The goal of the portfolio’s accountability action plan needs to consider how to prevent ambiguities and misalignment amongst the portfolio strata via utilizing appropriate accountability mechanics. The risk of failure is great when organizational goals are inadequate or misaligned with processes (Clark & Estes, 2008).
- Leadership Practice
Berson and Avolio (2004) describe leadership as being a significant factor in organizational accountability and organizational alignment. Therefore, the first step towards an ERP organizational change plan is for the executive and ERP leadership team to become intimately knowledgeable and aware of the varying accountability systems that exist within the organization. Such accountability systems can be characterized as bureaucratic, legal, professional, and political (Burke, 2005). As simply stated as this part of the project plan seems, it is an important notion to understanding accountability models to better manage expectations (Romzek & Dubnick, 1987) and change practice. From Firestone and Shipps (2005), it stands to reason that the interplay of varying accountabilities and any contention for resources, time, and effort be fully understood and prioritized. As Burke (2005) illustrates, the importance of accountability model interplay is a critical point with significant application in all industries. It is in understanding accountability across functions that we uncover important variability and tension with implications for change leadership.
- Balanced Scorecard & Metrics
Improving vision and communication by utilizing a balanced scorecard approach is another way to understand and manage accountability. What are the requirements of each [stratum] level in terms of ensuring structural alignment? Communicate the vision and value that the leadership places on organizational alignment specifically. This can be executed through the formation of a steering team focused on accountability that consists of a cross-function representation of all [strata] organizational levels. The steering team’s primary responsibility is to set priorities, define and establish metrics, identify resources, elaborate various processes, and systems needed to support the accountability requirements.
This steering team will review policy, mission, and goals to ensure that organizational alignment is a key organizational value. Ultimately, they will create a balanced scorecard that acts as a tool for assessing performance from the multiple [strata] level perspectives. A key deliverable of this steering team is to determine what specific metrics and key performance indicators (KPIs) will be required to manage and monitor accountability. The action plan should include a methodical approach to determining proper benchmarks as standards are inherently designed to manage and monitor the process by providing a concise set of guidelines (Hughey & Burke, 2010). The next steps of this plan will be for the steering team to;
- 1) determine appropriate strategic goals and targets for each metric
- 2) document these goals
- 3) formally communicate these goals.
Once it is determined what to benchmark, the steering team would be responsible for ensuring the most effective and efficient process for collecting and communicating of accountability metrics. Important to note is that the plan would include intervention mechanisms that allow adjustments to be made in terms of data collection, process, or communication gaps in terms of data and data usage.
- Iterative Process of Data Collection
For accountability to be cohesive, integrated, and continuously improving (Darling-Hammond & Snyder, 2015), N&A employs a useful model for improving accountability (March 2012) in which “interventions” characterize an iterative process that supports improved utility and collection. This iterative data collection process facilitates a better understanding of the data results that become useful knowledge of how to respond and make the data results actionable and hence, assess the effectiveness of actions.
The idea is to create an observational system of ongoing data collection that helps us identify conditions that may be successful in facilitating positive change or preventing progress. These conditions need to be understood as the project proceeds. The levers of success or prohibition could be knowledge, motivation, leadership, organizational structure, time constraints, policy, interpersonal trust, or data user beliefs as information requires explanation (Dowd, 2005).
Dowd (2005) describes useful examples of what data to collect, data interpretation, and communication of the results can be as important as the results themselves. This notion as described by Dowd (2005) is precisely the value of a disciplined steering team approach to help ensure that the information is the best interpretation and representation of the accountability goal, and then the dissemination of that progress and mission. To create visibility, purpose, and vision across all [stratum] levels, a balanced scorecard is a critical tool to develop and measure performance across the business units via a customized set of measures for main operational units that ties performance measure to specific goals.
- Ethics, Empowerment, and Trust
Your plan also needs to focus on ethics, empowerment, and trust. The value of motivation, cooperation, and ethics in this accountability action plan cannot be understated. An effective accountability action plan has six [strata] levels each with often varying ideas, knowledge, motivation, and experience, there must be a conversation around trust and constructive conflict resolution. Johnson and Johnson (1989) illustrate the value of constructive conflict improves the effectiveness of cooperative efforts. When managed constructively, controversy promotes a search for more information, and more reasoned judgment on the issue being considered (Johnson & Johnson, 1989). It is critical that leadership creates a learning, trusting, and sharing organization where the results of this iterative accountability structure are continuously improved upon (Garvin, 1980).
Addressing Accountability
In summary, the organizational change plan needs to address varying accountability specifically with an iterative examination and ongoing concrete action. The N&A accountability action plan focuses on five critical facets of accountability;
- organizational alignment
- leadership
- balanced scorecard
- an iterative process of data collection, ethics
- empowerment and trust
The overall goal of improved organizational alignment and accountability will be achieved through a cycle of learning improvement;
- setting clear goals and aligning resources to meet those goals
- ongoing communication and knowledge share
- collecting proper data
- turning data into useful knowledge
- using this reporting to set action items
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References
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- Al-Shamlan, H. M., & Al-Mudimigh, A. S. (2011). The Chang management strategies and processes for successful ERP implementation: a case study of MADAR. International Journal of Computer Science Issues (IJCSI), 8(2), 399.
- Berson, Y., & Avolio, B. J. (2004). Transformational leadership and the dissemination of organizational goals: A case study of a telecommunication firm. The Leadership Quarterly, 15(5), 625-646.
- Biesta, G. J. J. (2004). Education accountability and the ethical demand Can the democratic potential of accountability be regained.
- Burke, J. C. (2005). The many faces of accountability.
- Burke, A. W. H. M. G. (2010). External confirmation of adherence to standards As applicable to academic programmes as to business and industry.
- Clark, R. E., & Estes, F. (2008). Turning research into results: A guide to selecting the right performance solutions: Information Age Pub Incorporated.
- Nelson L, Haddad A. & Daughert L. (2013). Implementation of the DOD Diversity and Inclusion Strategic Plan A framework for change through accountability.
- Darling-Hammond, L., & Snyder, J. (2015). Meaningful Learning in a New Paradigm for Educational Accountability: An Introduction. Education Policy Analysis Archives. doi:10.14507/epaa.v23.1982
- Dowd, A. C. (2005). Data don’t drive Building a practitioner-driven culture of inquiry to assess community college performance.