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Scott Franchini is a Phoenix-based partner at RedHammer, an outsourced accounting and consulting firm specializing in the construction industry, who has held leadership roles at Deloitte & Touche, Deloitte Consulting and Microsoft. The opinions are the author’s own.
I have been implementing accounting software since the late 1990s, and despite all the advances in technology, the fundamentals of a successful implementation have not changed.
Over the years, I’ve seen countless projects in various industries, including construction, go astray, not because the software was faulty, but because companies made avoidable mistakes in the process.
Implementing new software is a significant challenge for any organization, especially in the construction industry, where job costing, subcontractor management and compliance monitoring add layers of complexity. Here are 10 of the biggest mistakes I’ve seen companies make over the years when implementing new software systems and ways to avoid them:
1. Underestimate the complexity
One of the biggest pitfalls of any software implementation is underestimating the complexity involved. The system you are implementing may be more complex than expected, or you may oversimplify the process, overlooking critical details. Misestimating complexity often leads to rushed implementations, jeopardizing the entire project.
To avoid this error: Thoroughly evaluate the software’s capabilities and your business processes before starting implementation. Break the project down into manageable phases, allowing for detailed planning and adjustments as needed, and hire subject matter experts to evaluate and understand the full scope of the project.
Scott Franchini
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2. Insufficient planning
Inadequate project planning is another common pitfall that can seriously affect the success of a software implementation. Without a well-defined plan outlining project goals, timelines, and resource allocation, the implementation process can quickly become chaotic.
To avoid this error: Develop a comprehensive project plan that addresses all aspects of implementation, including initial setup, testing, and post-go-live support. Assign clear roles and responsibilities to ensure accountability and communication throughout the project. Regularly review and adjust the plan to stay aligned with project goals and timelines.
3. It cannot be reset
Overlooking the opportunity to reset key elements such as your chart of accounts and cost codes is a missed opportunity to improve your financial and operational reporting. Implementing new software is the perfect time to clean up and reorganize these components to better reflect your current business needs.
To avoid this error: Take the time to assess your existing financial structures and identify areas for improvement before migrating to the new system. Consult financial experts to design a chart of accounts and cost codes that align with your current and future business goals.
4. Failure to identify reporting requirements in advance
Failure to identify reporting requirements at the start of the project is a major drawback. Without a clear understanding of the reporting required, your system configuration may not meet your business needs, leading to costly adjustments later.
To avoid this error: Conduct a thorough needs assessment to identify all reporting requirements before configuring the system. Collaborate with end users to ensure the system delivers the insights they need. Plus, build flexibility into your reporting structure to accommodate future business changes.
5. Trust the sellers
Relying solely on the software vendor to configure and test the system can be risky. While vendors know their products, they may not fully understand your business processes or your unique operational requirements.
Vendors often focus on offering a blanket solution that works for a wide range of customers, but may not align with your specific needs. This misalignment can result in a system that does not fully support your processes, leading to the need for costly post-implementation customizations.
To avoid this error: Actively participate in the configuration and testing phases to ensure that the system fits your specific needs. Establish a cross-functional team within your organization to oversee implementation and testing.
6. Not understanding your contracts
Not thoroughly reading and understanding the contract with the supplier is a common mistake. Software vendors and service integrators often include core services in their contracts, with any additional work often handled through change orders, which can drive up costs.
To avoid this error: Review the contract carefully, paying close attention to the scope of work and additional costs. Consult with legal experts and professionals who not only understand the legal, but also have experience with software implementations to ensure that the terms of the contract align with the complexities of the project.
7. Insufficient training
Insufficient training can lead to underutilization of the software’s capabilities and can lead users to revert to old processes, which can limit the effectiveness of the new system.
To avoid this error: Develop a detailed training plan covering all user roles and system functionalities. Provide ongoing training opportunities, including refresher courses and advanced training sessions, and foster a culture of learning, where users feel supported in mastering the new system.
8. Not prioritizing data migration
Data migration is a critical step that, if not done correctly, can cripple a new system. Mismanaged data migration can result in inaccurate or incomplete data, leading to significant problems in day-to-day operations and decision-making.
To avoid this error: Prioritize data migration early in the project, allocating sufficient time and resources to this task. Use data validation tools to ensure accuracy and integrity before you go live. Also, you should convert the master data beforehand and test critical transactions to ensure that the system behaves as expected.
9. Ignore post-launch support
Failure to plan or budget for post-go-live support can significantly undermine the long-term success of your software. Even the most robust systems require regular maintenance, upgrades and troubleshooting.
To avoid this error: Include post-go-live support in your initial project plan and budget. Establish a support team or contract with external vendors to manage ongoing maintenance and upgrades. Schedule regular system audits to identify and resolve any issues early on.
10. Poor change management
Poor change management can derail a software implementation. People often resist change, especially when it disrupts established workflows. Without a structured approach to managing change, adoption of the new system can suffer, resulting in underutilization or reversion to old processes.
To avoid this error: Communicate the reasons for the change clearly and consistently to all interested parties. Involve key stakeholders in the decision-making process to increase acceptance and reduce resistance, and provide ongoing support and resources to help users adapt to the new system.
The software implementation journey is rarely easy, but with proper planning and foresight, it doesn’t have to be a source of frustration or financial strain.
Whether you’re a small construction company or an industry giant, the key is this: the software itself is rarely the problem; how you execute it is what makes the difference.
