ERP failure: New research and statistics

Business Case, ERP 0 Comments

February 3rd, 2010 from ZDNet – “The research describes five primary results:

  1. ERP implementations take longer than expected
  2. ERP implementations cost more than expected
  3. Most ERP implementations under-deliver business value
  4. Software as a service (SaaS) implementations take less time than on-premise ERP implementations, but deliver less business value
  5. Companies do not effectively manage the organizational changes of ERP…

Measurable benefits. These figures are perhaps the most damning in the study. The report says a significant number of implementations surveyed did not deliver anywhere near the anticipated benefit or value…”

180 View – The ERP Report is based on research by Panorama Consulting Group. We understand that the research was based on online polling and qualitative data gathered from focus group interviews with a sample of survey respondents from December 2005 to December 2009. We also understand that the 1,600 participants represent global organizations that have completed an ERP implementation within the last four years.

The results of the survey are unfortunately not surprising especially with regard to on time and on budget. There are so many unknowns at the beginning of an ERP implementation that make scheduling and budgeting a huge challenge. We think the problem of lack of measurable benefits is less a problem with ERP than it is with misguided expectations from the beginning. The people within an organization wanting to proceed with the ERP implementation often prepare business cases which help support their recommended decision. Our perception is that there is a lack of independence and a lack of competence in preparing the business case, which rules out ever achieving the expected benefits.

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