The True Cost of Switching IT Systems

Digital honeymoons can’t last forever and, while the euphoria of a software purchase may have managers swinging from the treetops (or at least smiling for a healthy second or two), they could land with a bump if they don’t check what is hiding in the undergrowth.

Sure, you acquired the new system with efficiencies in mind, but are you mindful of the effort it will take to get you where you want to be?

Read on to find out, for the purchasing decision is only a small segment of the task at hand.

An Investment of Human Capital

The monetary outlay is only a tiny brushstroke on a massive canvas. Switching to a new system doesn’t happen overnight, and nothing can happen without you utilising your resources.
The most common trap that organisations fall into is failing to plan the necessary resource, even though the hard yards of organisational integration only really start once the system is bought.

From establishing technical requirements to documenting new processes, at least a few individuals are going to have to do some serious legwork to turn this automated dream-world into a reality. So, identify your team of technical wizards and appoint a project manager to ensure a smooth implementation and adoption process.

According to a survey conducted by Forrester Research, “people” issues are the biggest challenge to successful system implementation. These “people” issues fall into three distinct categories:

  • 15% aligning organisation with new ways of working
  • 49% slow adoption
  • 35% inadequate change management training

This shows just how important it is to invest in your employees. You must understand how they work and how the new system will benefit them – This needs documenting. It’s also important for you to communicate with employees, obtain feedback from them and provide adequate training both pre-launch and upon switching to the new system. All of this is a drain on resources and requires effective management to understand the costs involved in order to provide accurate details of the overall ROI of the project.

Embrace & Encourage Change

We may have signed up for it, but do we really want it? In truth, it is only when faced with change that we realise quite how much we’d rather not.

Even when the transformation is apparently for the better, teams have already adapted to inefficiencies, so removing entrenched processes could be harder than initially thought. No amount of rational explanation will iron out a disgruntled employee’s resilience, so be open to grievances and do what you can to soothe the process.

Allow for a transition period – with a week of open Q&A’s, for example – until the new systems are sufficiently bedded in, and the old way of (not really) working fades into the background. Only then will the change be welcomed.

Re-imagine Processes, Then Re-imagine Again

The beauty of sophisticated software is that it never quite behaves as we’d expect, so even our most thoughtfully designed processes will often need a level of re-working. Trust that there will always be a better way than the old, just don’t throw your toys out of the pram if it isn’t the first way.

Systems are built to satisfy many use cases, which means it can take time to acquaint oneself with the full range of functionalities. Have patience when exploring how data is stored and accessed, after which you should build out processes in an iterative fashion.

Everything is possible, just take it one step at a time.

Make Space on the Bookshelf

Be prepared for extra homework as bedtime reading takes on new meaning.

New systems mean new learnings, and there will be no shortage of documentation when it comes to understanding your new toy. Not only will you have plenty to read, but you might also have a little to write, so if you can find your very own Roald Dahl, you could even persuade employees to turn more than just the first page.

As internal processes evolve – and new projects hit full swing – documentation becomes even more important, so don’t skimp on the written word, instead get ready to fire up the print works.

Vendor Management

The final nail. Well, we hope not…

However, you will almost certainly have another partner to work with, alongside your new system, so be open to fostering a close relationship if you want your software to deliver the goods. Communication is vital for you to make the most out of your new system. They will be able to guide you through the entire process and know many of the hidden costs you may not have considered as part of your systems switch – Remember they’ve done this before!

If you’ve done your research and picked an A-team partner, then you won’t pity any fool when it comes to picking up the phone, however, choosing a reliable associate – then keeping the relationship sweet – will be crucial to your long-term success.

Key takeaways

Switching systems isn’t as easy as “out with the old, in with the new”. And, since one in six IT projects has an average cost overrun of 200% and a schedule overrun of 70%, according to the Harvard Business Review, it’s vital you plan ahead, set clear goals, create a clear plan and ensure you have the resource in place to manage the change effectively.

When attempting to calculate the cost of switching your system, along with the ROI, consider how much the following will cost you, both in terms of time and monetary value:

  • Resource required internally to manage the systems change.
  • Pre and post-launch training for each department.
  • Buy out from your old system.
  • Downtime from various departments in training or waiting for the system swap.
  • Data analysis of current data and transfer into the new system.
  • Documentation creation – both in terms of mapping old and new processes.
  • Project overruns – either overtime or budget. Change is good, embrace it – but appreciate the time it takes. Constantly monitor morale, organise refresher sessions and encourage adoption over the course of a few weeks.