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Stop whining about ERP failures

By | March 6, 2009, 9:08am PST

Summary: I’m highly skeptical of those who complain about failed projects without offering a better idea or solution. Unfortunately, that happens all the time.

As a guy writing about IT breakdowns and problems, I understand that large enterprise software rollouts don’t always go as planned. Despite this, I’m skeptical of pundits, analysts, and observers who complain about failed projects without offering a better idea or solution.

In a blog post on this topic, CIO magazine’s Thomas Wailgum wrote:

ERP software implementations can be painful—crazy expensive for the business, enormously complex for IT grunts, and annoying to change-averse users. Some see ERP as a necessary evil that enables 21st century companies to achieve competitive similarity with one another.

At best, these grueling ERP rollouts deliver a back-office system that will bore any sane person to tears. At worst, they can be costly and embarrassing corporate blunder….

THE PROJECT FAILURES ANALYSIS

Large ERP systems provide an organization with centralized planning, control, and analysis capabilities. These systems do work, but implementations are complex because the software reaches so deeply into processes and departments across the buyer’s organization. It’s hard to convince disparate groups in any company to engage cooperatively for the express purpose of instituting change.

Many projects fail because the buyer doesn’t fully understand the ramifications of implementing a major enterprise system. For example, here’s what I said about failing implementations in San Diego, Marin County, and Oak Park:

In general, it’s not unusual to see an enterprise software implementation overwhelm a small local government’s [or private sector organization's] capacity to handle change.

The solution lies in three areas:

  1. Enterprise customers should be more careful assessing their own capabilities before undertaking any complicated organizational change initiatives, including implementing ERP systems.
  2. Systems integrators and consulting firms must be more straightforward in explaining pitfalls and success requirements to potential clients. Some consultants paint an overly positive picture during the sales process. That nonsense has to stop.
  3. Software vendors should build modular and easier-to-implement systems; improving software usability also reduces implementation failure rates. The major vendors have already embarked on this path, but they need to do more.

Responsibility for improving failure lies with these groups. Failure rates will drop when all three more fully embrace their own responsibilities for driving successful deployments.

Although large back office systems aren’t sexy, they are integral to the successful functioning of governments and businesses of every size. Despite unacceptably high rates of implementation problems, the world can’t just walk away from large enterprise systems: that’s why the implementation failure issue is so important.

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Topics

Michael Krigsman is a recognized authority on the causes and prevention of IT failures.

Disclosure

Michael Krigsman

Michael Krigsman writes and speaks about technology in a manner that most observers consider to be fair and balanced. Michael believes that writing about IT failures, which often have complex causes, creates a unique obligation to be reasonable and accurate in both reporting and analysis.

Michael maintains active personal and professional relationships with enterprise technology buyers, vendors, analyst firms (or individual analysts), consultants, and system integrators. As CEO of Asuret, Michael sells and delivers paid services to members of these same groups.

Vendors regularly reimburse Michael's out-of-pocket travel expenses to attend industry conferences and events. Conference organizers frequently waive entry fees when Michael attends industry events. Michael often speaks at industry conferences and events.

He is a member of the Enterprise Irregulars, a loose association of consultants, investors, industry representatives, analysts, and users of enterprise software.

For daily updates on Michael's activities, follow him on Twitter.

Biography

Michael Krigsman

Michael Krigsman is CEO of Asuret, Inc., a consulting company dedicated to reducing technology implementation failures. Asuret's suite of software tools improve the success rate of enterprise software deployments by quantifying and measuring governance issues that cause most project failures. Michael led the research effort underlying Asuret's model of collective intelligence and its practical application to reducing IT failures in consulting environments. He is a recognized authority on the causes and prevention of IT failures and is frequently quoted in the press on IT project and related CIO issues. He is considered an enterprise software industry "influencer" and provides advice to technology buyers, vendors, and services firms.

Previously, Michael served as CEO of Cambridge Publications, which develops tools and processes for software implementations and related business practice automation projects. Michael has been involved with hundreds of software development projects, for companies ranging from small startups to Fortune 500 organizations. Michael graduated with an M.B.A. from Boston University and a B.A. from Bard College. He is a Board member of the America's Cup Hall of Fame and the Herreshoff Marine Museum in Bristol, RI.

8
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RE: Stop whining about ERP failures
beaubouef@... 24th Apr 2011
Michael - let me offer a solution for you to help us move in the right direction. The first step is realize that traditional "build-from-scratch" implementation approaches will not work for packaged software like ERP. What is required is an implementation approach that addresses both the strengths and weaknesses associated with ERP - or any packaged software. To you readers I would like to offer my 10 principle strategies for ERP implementation success.

http://gbeaubouef.wordpress.com/erp-business-solution-manifesto/
0 Votes
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If I am simply a user...
bjbrock 6th Mar 2009
of the failed roll out there is NOTHING wrong with me complaining about my IT departments failure - without offering a solution. As a user, solutions are not my job. My job is to be able to use the proposed solution. If its failure affects me, such as preventing me from doing my job, it is well withing my rights to complain. Just as it would be if my failure to perform my job affected others down the line.

The buck has to stop somewhere. And with failed IT projects it stops at the IT department and/or those involved in developing, or not developing as the case may be, the solution.

Anytime someone fails at their job there is going to be whining from those affected. If ERP developers are not up to the task they should be in the unemployment line or pushing a broom somewhere. Something more in line with their skills.
0 Votes
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Contributr
Really good point
mkrigsman@... Updated - 6th Mar 2009
My comments were not directed at ordinary end-user "civilians." You are absolutely correct that users should not tolerate the kinds of terrible implementation experiences we read about all the time.

Thanks for commenting!
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This really depends on the failure.
RationalGuy 19th Mar 2009
If this is a failure of implementation, then I suppose your general point has some merit (although complaining about a problem doesn't really accomplish anything, so it's kind of a big waste of time).

However, if it's a failure of achieving the expected ROI, that is most often a failure of the users. Assuming the system is implemented properly, it is the job of users to derive benefits from the system for the business, not the job of IT.
0 Votes
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(big yawn)
nizuse 6th Mar 2009
"Despite unacceptably high rates of implementation problems, the world can?t just walk away from large enterprise systems"

Who said that the world wants to walk away from large enterprise systems?

Noone. Therefore, your point is moot.

And if people want to complain about ERP implementation failures then that's functional. And based on facts.
0 Votes
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Actually...
elizab 6th Mar 2009
...the CIO Magazine blog post cross-referenced (Thomas Wailgum), did conclude that companies will avoid large ERP implementations due to the enormous waste associated with either failed, run-away, or terminated implementations.
0 Votes
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Contributr
The CIO guy said so
mkrigsman@... 6th Mar 2009
That's the whole point: the CIO fellow said companies will walk away from ERP. My point is that's impossible, so therefore we need to figure out how to implement less expensively.
0 Votes
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Perfect Solution for ERP problems..
torres1986 Updated - 12th Mar 2009
1. Analyze your business closely.
2. Search for ERP softwares related to your business.
3. Optimize your selection by selecting the appropriate
one. ERP consultants can make this step easier for you.
4. Learn the characteristics of the selected software in
detail.
5. After gaining a good knowledge about the software
plan your implementation and proceed.

These steps will minimize ERP selection problems.

For complete information about ERP products,vendors etc.
visit http://erp.com
0 Votes
+ -
RE: Stop whining about ERP failures
beaubouef@... 24th Apr 2011
Michael - let me offer a solution for you to help us move in the right direction. The first step is realize that traditional "build-from-scratch" implementation approaches will not work for packaged software like ERP. What is required is an implementation approach that addresses both the strengths and weaknesses associated with ERP - or any packaged software. To you readers I would like to offer my 10 principle strategies for ERP implementation success.

http://gbeaubouef.wordpress.com/erp-business-solution-manifesto/

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