(Source: WSCPA Management Consulting Services Committee)

1. Failure to consult with an accounting professional.

· Keep goal (functional system) in mind … if you don’t know, ask.

· Professionals implement systems for a living.

· They can apply systematic methodologies to the project.

· They can establish realistic budgets and schedules.

· They can act as facilitators.

· They can propose useful ideas from other companies, other industries.

2. Underestimated total cost – software, training, support, etc.

· California Society estimated 1-2% of company annual sales.

· Software cost is just part of the total cost:

Price Waterhouse study:

· Hardware 20%

· Software 10%

· Installation & Training 15%

· Internal Costs 45%

· Maintenance 5%

· Supplies 5%

· Documentation costs – document how the system works in YOUR company. Software manuals document only how the software works.

3. Underestimated implementation time

· Spend time improving procedures before the implementation starts.

· History volumes vs. keypunch time required.

· Masterfiles (customer, vendor) – 30 per hour.

· Transaction detail (invoices, purchase orders) – 50 per hour.

· Training time for data entry people.

· Supervisory time.

· Time available to staff for implementation.

· Half-day sessions, two or three sessions per week, can take two months.

4. No backup – programs, data, people

· The job’s not over until the backup’s done.

· Tape, disk.

· People can leave, too.

5. Inadequate training

· Staff left to figure it out on their own.

· Transaction training, but no end-of-period training.

· “The General Ledger isn’t posting”

6. No help with set-up

· This is the same impulse that keeps people from asking directions.

· Setup is typically a series of questions in the software that control how the system operates.

· No use of outside consultant/installer for setup tasks.

· Wrong inventory valuation method is an example.

· Hard to change after processing has begun.

7. Unprepared staff – lack of skills, willingness, time

· People operating over their heads.

· Accounting skills are often lacking, no computer skills.

· Fear of new systems, new procedures.

· Make sure they have input in the selection process.

· Concern for their job, “What if I can’t learn?”

· Involve the staff from the start.

· Fully tasked with day-to-day operations, no time to implement.

· Involve other departments in the company from the start.

8. Wrong software.

· Spend time before your purchase to evaluate your business and software requirements.

· For example, distribution software in a manufacturing environment.

· Selling services through the inventory module.

· Time of year differences – paving company.

· Problems can surface during installation.

· Much high-level software is non-returnable once you have installed it.

9. No project leader

· These projects need top management involvement from the start.

· Designated individual responsible for coordinating resources and enforcing the plan.

· No responsibility without authority (to spend).

10. No plan

· Task One: choose a “cutover date”

· Specific sequence of tasks with assigned responsibilities.

· Build masterfiles first, then enter history, then begin processing transactions.

· For example, enter AP vendors first, then open invoices, then start processing checks.

· Plan hardware as well as software.