There are hundreds of cases of ERP failure and there are many causes for ERP failure. Some of the common problems of ERP are -
Lack of support from the top management: Sometimes software implementation is delayed because of lack of support from top management. The management of a company should actively take part in the process to enable easy and successful implementation. Sometimes the ego clashes between top management may delay the process.
Selection of poor package: If the platform or the technology which is selected by a company is not suitable for the company it may result in failure. At least four to five months time should be attributed towards vendor selection and for deciding the appropriate technology which may meet the need of the organization.
Inadequate resources: Buyers underestimate the cost of software acquisition. During the process the scope of functionalities may grow and the users may want all the functionalities they see in the ERP and therefore, the cost of acquisition extends beyond the estimated cost. The management of a company should take in the hidden cost on implementation to estimate of cost because there are numerous hidden costs involved such as unproductive time when the employees are learning to use the new software, replacements of old systems etc.
Lack of infrastructure: A buyer may not be in a position to provide the support for implementation procedure. The lack of proper infrastructure can result in failure of the process. The organization should arrange for resources before going for system installation.
Resistance to adopt new changes: The new software may bring in new changes which are needed for the company to adopt to make the process effective. Sometimes the companies buying the package are following certain way of working and it is not ready to change it, even if the new changes can speed up the process. It is important for the company to look to the future needs and adopt the changes which may be feasible and may not affect the business process.
Improper project design: The project design should be practicable and there should not be unrealistic expectations from the project. The companies that try to get unrealistic ROI may not be satisfied with the new system.
Need of Training: Some companies want their employee to perform and be productive even during the implementation process but it is not possible for the office to work normally when the software is getting implemented. Companies require training sessions and then the new system gets adopted. Even after getting training sometimes the employee find it difficult to deliver their best during the initial few months of installation. It is important for the buyer to estimate the cost of each and every stage of implementation.
Poor communication: It is very important for the vendor team to communicate to the buyers to understand the requirements accurately otherwise the results will not be delivered as needed. The vendor may have to communicate with the employees who will use the new software to make them understand the new process and to know their way of working.
