Why most ERP implementations fail

You may have chosen the right ERP, chosen the right implementation partner and still could be having a failed ERP Implementation. Let’s dig deep in to it and see what the pit falls are; also look at how you could overcome them.

With my own experience, I have identified couple of factors where we can focus in order to execute a successful implementation. This would be extremely helpful for both the Implementer and the Enterprise Resource Planning Buyer.

Spend extra time during pre-sales

When are selecting an ERP company to work with, it would be really important to work with a party who is willing to spend a significant time during the pre-sales process. On the other side of the token, ERP Service Provider should be in a position to allocate a significant time in analyzing the company, understanding the requirement properly, and know their expectations (in other words what is the expected outcome of having a new ERP Solution.

Furthermore ERP provider should state the limitations of the application while explaining how best they can achieve the desired goals of the client.  If I were an Implementer of an ERP solution, I would be following these criteria’s strictly: one, once the requirement has been gathered during presales process, take a further step and even dig little deeper in to the requirement to see whether your solution can be catered to their requirement or satisfy some of their critical business processes. Two, propose a POC for your client for a nominal fee. On the other hand, client should realize it can save lot of time and money during the implementation cycle instead of trying find some solution during the period.


Changing the requirement during Implementation

In some scenarios, client tend to change the requirement halfway through the implementation cycle. During requirement gathering stage or pre-sales stage some processors were discussed; however, halfway through the implementation cycle, clients decide to change certain business process or change the way it should be handled via the application. This can create many complications; one change could lead in to many changes. Eventually end-up in very long cycle where it seems to be never ending.

This can also be prevented by agreeing with the client initially; could be with a proper document (can come up with your own name) and the commitment from the client.  Also explaining the complication it could have. Another important factor is that Implementer should identify any gray areas or any ambiguities in clients’ business process, leave a considerable margin; in other words come up with some alternative, work-around before going in to the implementation. Also, planning the implementation by knowing all the “X” factors and being proactive.

Importance of One to Many Option in an ERP

Before looking at a real business scenario, let me explain about the One to Many Option. This can be a very useful feature for manufacturing companies. All though One to Many option is there to convert Bulk quantities in to many small quantities, this can be very useful for manufactures, even to apply this to their main production.

For Example, if a manufacturer wants convert 1,000kg of Sugar in to 100g and 200g bags, this feature would be an ideal scenarios; however, this can be used in much more complex scenarios.

If they procure their raw materials in liquid form and after processing it, the final product comes in the form of solids, this can be also managed via One to Many Option. Also, the by-products produced during the processing can be identified with this option as well if required

Sometimes such conversions seems very easy, but it is important to see it’s impact on the inventory.