The Post-Go-Live Productivity Dip is a Reality: Be Honest and Then Be Prepared
The post-go-live productivity dip deserves attention. ERP organizational change success doesn’t end, and isn’t determined, just when you “hit the switch”. In fact, it is really just the beginning of opportunities for continuous organizational improvements and the realization of benefits and ROI. And, the value of formal and informal learning and training doesn’t stop after you “hit the switch”. During the pre-go-live phase, preparation and readiness training needs to consist of effective and efficient organizational stakeholder learning. This leaning should be executed with a scaffolding approach such that the learning process is effective. This learning should address conceptional as well as functional ERP learning. It should include user acceptance testing (UAT), conference room piloting (CRP), and formal and official sign-off among other best practices founded in principle in order to ensure proper training.
Pre-go-live training is just the half of it
But, even given and assuming an effective and efficient pre-go-live training program, that’s really just the start. It is one thing to learn in a pre-go-live environment, it is another thing to learn on the job in a “real world” environment after the go-live. More to come on this in future posts, but to a certain degree, the transition past the productivity dip is a function of human learning and the application of effective ERP organizational change learning programs. We are going to discuss the post-go-live productivity dip further on upcoming posts and articles, but there are multiple reasons for this dip. The key is not to just try to mitigate the productivity dip as much as possible (via the most effective and effect pre-go-live training), but to also just acknowledge and be honest about it, and then be prepared with tangible and effective post-go-live tactical actions that help ensure the transition past this productivity dip.
A key post-go-live success concept #1: Application of learning
One major and primary key to post go-live transition success comes with; 1) a continuous learning program, 2) effective and efficient transfer of knowledge to the workplace, and 3) and proper measurement, adjustment, and support for the application of the knowledge that was gained in pre-go-live training.
“Up to 70 percent of all learning that directly contributes to job performance takes place on the job” (Kirkpatrick & Kirkpatrick, “Four Levels of Training Evaluation”, page 15).
In their book “Four Levels of Training Evaluation”, page 35, Kirkpatrick and Kirkpatrick discuss how “Reinforcement that occurs after the learning event produces the highest level of learning effectiveness, followed by activities that occur before the learning event, yet each typically garners only 5 percent of the training time and budget”. Essentially what Kirkpatrick and Kirkpatrick are stating is that there is great value in transfer and application from the training room to operations. And, this is certainly no less true in the context of ERP organizational change. Kirkpatrick and Kirkpatrick also note that (provided and assumed you have an effective and efficient pre-training program), “…when desired program outcomes are not achieved, the cause is usually found on the job, not in lack of knowledge or skill. It is seldom necessary to send employees back to the classroom.”, again, assuming proper, effective, and efficient training. Kirkpatrick and Kirkpatrick are simply stating the value of transfer and application of training to the “real world” environment and that lack of application can often be a significant gap in effective learning and hence desired business results. Therefore, your ERP organizational change plan would benefit from the points of Kirkpatrick and Kirkpatrick in that pre-go-live classroom training and evaluation is just a part of success, the successful application is also critical. And the successful application needs to be wholly advocated and endorsed by the organization.
Kirkpatrick and Kirkpatrick are basically telling us ERP Organizational change practitioners that effective training as well as training expectations, evaluations, and the application doesn’t end after the classroom UATs and CRPs. So then, the ERP organizational change plan must have concrete, specific, organizationally aligned action items in order to ensure that training and its application is effective. This will help organizations accelerate past the known, factual, expected, and accepted (to a certain degree) post-go-live productivity dip.
A key post-go-live success concept #2: A honest reality in that success and realized benefits aren’t always immediate
In “Firm Performance Effects in Relation to the Implementation and Use of Enterprise Resource Planning Systems”, Nicolaou (2011) states that ERP implementation represents a significant commitment that impacts nearly all business processes. Nicolaou also states that given the sheer nature of ERP, benefits aren’t and can’t all be realized within a short time frame. Nicolaou (2011) suggests that ROI and expected benefits can be a longer-term realization. Nicolaou further adds that the “return on assets and return on investment were negatively affected by ERP adoption in the year of and following system completion”. In other words, success and realized benefits aren’t always immediate and fully realized just because an organization “hit the switch”.
Moreover, in “Effect of enterprise resource planning implementation on organizational productivity.” Newlin (2009) states a great and true point, “ERPs evolve as they make their way through a life cycle, usually starting with conception and ending with a new way of doing business”. Newlin also describes the post-go-live productivity dip as:
“Next is stabilization where processes are cleaned up and organizations attempt to adjust to the new environment. Continuous improvement follows and is defined by adding bolt-ons, which are specialized applications that augment the ERP system and engaging in process redesign to implement new structures and roles to leverage the system. Finally, the organization enters transformation, where the use of the new system is part of everyday operations. There is no longer management emphasis on using the system, it is simply used. Organizational personnel has accepted the system and processes have been modified to match the information system if necessary.”
The moral of the story:
Be honest and realistic within the organization that the effort and training (and its application) doesn’t end after go-live. The ERP benefits happen, but they depend on the holistic approach to the effort. In “Minimizing the human capital aspect of productivity disruption during the implementation of an enterprise resource planning (ERP) system”, Newlin (2009) states that “In order to minimize the productivity dip, it is necessary to have a realistic expectation regarding depth and duration of the dip, and understand the factors that contribute to the dip including how to manage them”. And then, build concrete action items into your ERP organizational change plan in which to address these factors.
Lastly, Sobyanina and Mockutė in their work “ERP post-implementation: Risk assessment” make a great point/suggestion: “In the end, it should be mentioned that the awareness of potential risk factors and their dependence on each other can facilitate managing process and help to avoid possible negative effects for a company’s business. Sometimes manager’s confidence that technology could solve any problem, might discourage employees from presenting a realistic view, which, in turn, may prevent from addressing post-implementation issues more effectively……The findings suggest that companies should invest and pay more attention not only in technological solutions but in organizational or human resource areas, e.g. every company should have a proper human resource strategy that implies not only monetary rewards but non-material values as well, such as training, seminars or participation in projects”.
Well said indeed.
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