ERP and its impact on organizational culture and employee productivity

Enterprise Resource Planning (ERP) systems have become increasingly popular in the business landscape today. These systems are designed to streamline business processes and improve productivity. While many organizations have successfully implemented ERP systems, there is still debate about their impact on organizational culture and employee productivity.

One of the primary benefits of an ERP system is that it allows companies to automate processes, which can lead to increased productivity. However, this automation can also have a negative impact on employee productivity if they are not properly trained to use the system. Employees may feel overwhelmed or frustrated by the new system, leading to a decrease in productivity and a negative impact on company culture.

According to Doug Hunter Customer and Ecosystem Enablement Manager at SYSPRO Africa, “Part of successful ERP implementation comes from the way the vendor and customer work together in the handover — there has to be an in-the-trench transfer of knowledge on why and what the software does to help processes, users and the customer business in general. Showing only screens and walking away may lead to a failed project.”

In addition to employee productivity, ERP systems can also have a significant impact on organizational culture. These systems can standardize processes and procedures across the organization, which can help create a more cohesive culture. However, they can also lead to a “one size-fits-all” mentality that stifles creativity and innovation.

To mitigate the potential negative impact of ERP systems on organizational culture and employee productivity, companies should focus on training and communication. Employees must be properly trained on how to use the new system to avoid feeling overwhelmed or frustrated. Additionally, companies should communicate with employees about why the system is being implemented and how it will benefit the organization.

It is important to note that the impact of ERP systems on organizational culture and employee productivity can vary depending on the organization and how the system is implemented. Companies must take the time to understand their unique needs and tailor their implementation accordingly.

Hunter adds “If ERP and other organizational changes increase your productivity -which they do – they will increase capacity for more work output from the same people. Look to new work to fill this capacity rather than release employees as a cost saving. Go for growth using the same team – this will lead to not just a higher profit % but more of it as well from the increased revenue without additional labour cost. It will also prevent serious organizational culture issues.”

In conclusion, while ERP systems can provide significant benefits to organizations, they can also have a negative impact on organizational culture and employee productivity if not implemented correctly. To avoid these potential pitfalls, companies must focus on training, communication, and tailoring their implementation to meet their unique needs. By doing so, they can successfully implement an ERP system that improves productivity and enhances their organizational culture.