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Why do Enterprise Resource Planning Implementations sometimes fail?

I have been working for almost 11 years with ERP Solutions especially Microsoft Dynamics NAV and AX and I saw that many times these implementations failed for many reasons.

I have dedicated time today to talk about the main 3 reasons and hopefully soon I will be listing more reasons for the failure of the ERP implementation.

– One of the most important reason is the non-readiness of the company: In Lebanon and most of Arabic countries , Companies are most of the time not mature or ready enough to implement new ERP solution due to the fact that:

  • most of processes are not defined yet
  • current employees are not yet qualified to work on well structured ERP solution
  • most companies are not following the right processes for their industry
  • most companies are afraid to change their old ERP solutions
  • most companies are not having the right Hardware infrastructure to implement new ERP
  • Most companies are not having the needed time to implement new ERP since Key users are always busy with daily operation and cannot find and dedicate the needed time to implement new ERP

– Second reason is the experience of Implementer : we have currently big demand on ERP consultants while the available experienced consultants in all Middle east are not enough for these demands. For that reason, we found out that we have junior consultant working on most of the ERP implementation which means that the implementation will take longer time and the implementation will not follow the best practices so at the end we have a big failor.

– Third and important reason is the budget : most of companies looking to implement ERP solution dedicate a fixed budget for the implementation that is most of the time not enough to implement a complete solution that fits with the company’s requirements. Indirectly this will push the supplier implementing the ERP solution to reduce expenses which always means reduce the quality and the deliverable of the implementation. At the end the ERP implementation will be partial and the customer stop using the new ERP and step back to the old ERP.

so Before you start your ERP implementation, I suggest that you make sure of the following :

  1. Prepare all the pre-requisites for any ERP implementation
  2. Have the needed time and make sure Key users are available for the new implementation
  3. Select the right and experienced ERP supplier and make sure to check CVs of ERP Consultants before select the right one
  4. Dedicate the needed budget for the implementation of a complete ERP solution