No company ever intends for an expensive and brand-new program like Dynamics NAV to fail. Unfortunately, these sorts of obstacles do occasionally arise. With this in mind, managers need to be adequately prepared in the event that their enterprise resource planning system has failed in some way. Since an ERP system deals with so many aspects of the day-to-day operations – in some cases, it deals with all of the aspects – having the system break down can be a major issue that needs to be dealt with immediately. In light of this possibility, companies should establish and implement an ERP failure recovery plan to combat this problem quickly and efficiently.
ERP failures can cost businesses big chunks of revenue. According to CIO.com, Nike lost $100 million in sales after its $400 million ERP upgrade went awry. Meanwhile, a host of problems hit HP during its ERP rollout, costing the company $160 million. Managers need to be prepared to deal with these problems immediately to avoid as much revenue loss as possible.
Many templates are available to assist in dealing with an ERP failure. However, the difference between various enterprise implementations makes any cookie-cutter approach to remedying the problem insufficient. When devising a recovery plan, managers should start by planning for a worst case scenario and then work backward from that situation. Figuring out what to expect in terms of a system failure can be an exhaustive yet incomplete process – nobody can properly predict the future, after all. Any number of external forces can shut down the system, from a power outage to a fried motherboard in the system.
Despite the hazy nature of the future, there are certain steps managers can take to ensure an ERP failure recovery plan is in place. Two of the most successful approaches to incorporate into any recovery plan include preventative measures and recovery actions.
Even though managers can only prepare for so many potential disasters, it still becomes incumbent upon their part to ensure as many contingency plans can be put into place if a system failure does occur. According to Panorama Consulting, the vast majority of failed ERP projects involve mismanagement of the system's implementation and not a technological issues. This indicates managers need to ensure employees are properly trained on the system, in addition to the manager knowing the program inside and out.
Other simple steps can easily avoid bigger problems down the road. Managers should utilize uninterruptable power supplies and provide redundant electric circuits to decrease the possibility of a single point of electrical failure.
No matter how hard manager try to prevent a failure, there is still a chance it will happen. In this case, the company needs a quick and agile response to ensure production and sales continue. Managers should have a disaster recovery backup stored off site that can restore the entire ERP system. Many cloud-based backup sites provide storage as well as disaster recovery systems.