Why do ERP projects fail so often?
At its simplest level, ERP is a set of best practices for performing
the various duties in the departments of your company, including
in finance, manufacturing and the warehouse. To get the most
from the software, you have to get people inside your company
to adopt the work methods outlined in the software. If the people
in the different departments that will use ERP don't agree that
the work methods embedded in the software are better than the
ones they currently use, they will resist using the software
or will want IT to change the software to match the ways they
currently do things. This is where ERP projects break down.
Political fights erupt over how or even whether the software
will be installed. IT gets bogged down in long, expensive customization
efforts to modify the ERP software to fit with powerful business
barons wishes. Customizations make the software more unstable
and harder to maintain when it finally does come to life. The
horror stories you hear in the press about ERP can usually be
traced to the changes the company made in the core ERP software
to fit its own work methods. Because ERP covers so much of what
a business does, a failure in the software can bring a company
to a halt, literally.
But IT can fix the bugs pretty quickly in most cases, and besides,
few big companies can avoid customizing ERP in some fashion every
business is different and is bound to have unique work methods
that a vendor cannot account for when developing its software.
The mistake companies make is assuming that changing peoples
habits will be easier than customizing the software. Its not.
Getting people inside your company to use the software to improve
the ways they do their jobs is by far the harder challenge.
If your company is resistant to change, then your ERP project
is more likely to fail.