IT and Project Management: How Cloud ERP Systems are Changing Project Management
By Guest Contributor Brian Thomas
Published on October 2, 2018
Businesses of all sizes can benefit from effective project management. In fact, the modern enterprise model would be all but impossible without a widespread application of proven project management techniques.
For thousands of years, project management was completely manual, which could require an extensive amount of time. Today’s world is too fast-paced for that. Nowadays, projects need to be delivered on time, hit specific objectives and have budgetary constraints that can be quite restrictive. Those three core considerations are commonly depicted as the “triple constraint”: Time, Scope and Cost.
Hitting all three targets is no easy feat. Meticulous planning has always been a prerequisite of effective project management. But the ability to adapt to changing conditions often make the difference between a successful project and one that fails.
How modern tech makes the triple constraint easier to work with
Above all else, effective adaptation requires constant communication with various project stakeholders. Communications that once took place via telegraph and phone line are now conducted largely online. Examples of such tools are email or business-focused chat apps like Slack, Google Hangouts, or Skype.
These tools may work for small teams with small projects and may make them quite successful. But as complexity grows, so too does the need for a comprehensive software-based project management solution. Slack messages might be useful for a spur-of-the-moment update, but it’s not an effective way to track any larger projects.
Larger enterprises have historically used project management apps that were part of integrated enterprise resource planning (ERP) software suites. While originally used to optimize manufacturing processes, ERP solutions grew in scope and capabilities as the PC became an essential workforce tool in the 1980s. By the start of the 21st century, most ERP suites were handling processes and information connected to:
- human resources
- sales and customer relationship management (CRM)
- asset management
- and some business intelligence and forecasting functions
Connecting front- and back-office functions into a ERP let project managers easily see what was happening throughout their organization. Instead of wondering why a shipment of components wasn’t available, a project manager could track progress through the supply chain. Instead of jumping through two dozen hoops to get a budget increase to finish a key deliverable on time, a project manager could now make a direct request to the finance department and could see if such a request was even possible under current fiscal circumstances. A savvy project manager could even anticipate an upcoming need for more workers and initialize the hiring process in advance. Every example here is a form of streamlined communication made possible by modern ERP systems.
Where ERP succeeded, and where it falls short
The increasing web of connections between formerly siloed operating segments has forced employees to collaborate more across the board. This is a boon for the project manager, whose fundamental duties requires collaboration with a wide range of people inside and outside their organization. Business consultant Don Tapscott has said that “learning to collaborate is part of equipping yourself for effectiveness, problem-solving, innovation and life-long learning in an ever-changing networked economy.” In a way, ERP systems have made all employees project managers to one degree or another.
Unfortunately, this idealized picture you’ve just seen has been more a goal than a reality until quite recently.
An organization with thousands of employees had to contend with the need to install, monitor, secure, and update thousands of copies of an ERP suite across dozens or even hundreds of different devices. Each employee had to be granted the proper role authority to access and modify data within the ERP suite. In some cases they might have received only parts of the suite on their work PC when it was installed. Upgrading role access would require a visit from the IT staff, who might have had to contend with unexpected errors. This could be because of something the employee put on their machine wouldn’t want to cooperate with the ERP system.
Historically, most ERP implementations (64 percent) have run over budget, and nearly eight out of ten new ERP implementations (79 percent) ran over schedule, according to Panorama Consulting’s 2018 ERP Report. By far the most common reasons for failure, on both counts, were “unrealistic expectations” and “organizational issues.”
So how does actually IT and Project Management work together?
The combination can certainly improve and streamline project management — when it works! But as many veteran project managers can attest, the software their employers provide can be quite a headache. And as Panorama’s data reveals, many of the problems with ERP adoption could have been addressed by putting skilled project managers in charge of the effort from the start. Thankfully, these problematic experiences are changing for the better with the rise of cloud ERP systems.
A cloud ERP system solves many of the issues mentioned earlier. Suddenly organizations didn’t need to manually installand update software on every employee’s machine. They could just deploy the same system, with the same configuration at the same time. All they need to do is teach their employees how to access the system and provide login credentials.
Upgrades and add-ons can also be deployed to the entire organization simultaneously. In many cases, this would happen with no input from anyone in the organization. The company supplying the cloud-based ERP system can roll out upgrades to every customer systemwide. Since the system operates remotely, granting access to employees could be done by flipping a switch in the admin console.
A cloud ERP system solves at least one significant problem inherent to on-premises ERP solutions, and it also confers a significant benefit that on-premises systems were typically unable to offer.
Your data is securely managed by competent people
By centralizing the system on remote hardware maintained by thousands of highly-trained engineers and developers, enterprises can mitigate or even eliminate the risks of their systems being hacked or otherwise damaged. As Oracle CEO Mark Hurd has noted, “85 percent of security breaches take advantage of system vulnerabilities for which a patch was available for more than a year.” A cloud ERP system eliminates this risk entirely, as cloud ERP providers tend to patch vulnerabilities systemwide as soon as they’re discovered.
The underappreciated upside to cloud ERP is that, by tapping into the computing power of a global tech company’s data centers, enterprises can make use of resource-intensive innovations like artificial intelligence (AI) and machine learning (ML). AI and ML can analyze massive amounts of collected data and create actionable insights that can help project managers in a variety of ways. In a podcast interview with Forbes, Hurd also noted that he believes “you’ll see AI integrated into most everything that comes to market” in the future. This is only possible by utilizing supercomputing-scale resources — the average PC or smartphone certainly wouldn’t be able to process the amount of data an enterprise creates in real time, let alone find meaning in the noise at any speed resembling real time.
The bottom line of Cloud ERP systems: how does this help project managers?
Imagine deploying ML to track changing prices on component shipments to find the days, or even hours, in which they’re offered at lower prices. A project manager might utilize AI to schedule contracted or hourly employees for work based on the errors they’d made on past projects or on their assessed skill sets for a particular task. Humans can only look at so many spreadsheets before their eyes start to cross. An AI however, can analyze billions of data points to find ways to save money or time on a project. Simply using AI-driven predictive analytics to find these pathways to greater efficiency saves the project manager from spending hundreds of hours analyzing data by hand.
Connecting today’s distributed workforce with one unified system also presents a toolkit that can substantially reduce errors and duplicative efforts. Kanban-based project management apps like Trello are now so ubiquitous and easy to use that they’ve been adopted by one-person consulting shops as well as by large enterprises. If your project involves participants in different locations, there are few software tools better at collaboration than Kanban-based workflow-tracking systems. A cloud-based ERP suite can integrate a Kanban-style project board with other parts of the enterprise. Project managers can then stay on top of metrics like employee hours, project expenses, sub-task workflows, material volumes, and following the progress of the overall project itself.
Project management has always been critical to the progress of human society. But with today’s cloud ERP solutions, project managers can do more in less time, with greater precision than ever before.