Why Most ERP Projects Fail (And How to Avoid It)

The Uncomfortable Truth About ERP Failures

Let's start with a number that should make every business leader uncomfortable: 70% of ERP implementations fail to meet their original objectives. That's not a typo. Seven out of ten projects either overrun their budgets, miss their timelines, or—most critically—fail to deliver the business value they promised.

But here's what most consultants won't tell you: the software is rarely the problem.

The Real Culprits

After working with dozens of ERP implementations across manufacturing, distribution, and technology companies, we've identified the actual reasons projects fail:

1. Vendor-Led Design

When your ERP vendor controls the design process, they optimize for their software's strengths—not your business needs. You end up with a system that's technically impressive but operationally useless.

2. Weak Business Requirements

Most companies can't articulate what they actually need from an ERP. They know they want "better reporting" or "streamlined processes," but they haven't defined what that means in specific, measurable terms.

3. Process Chaos Baked In

Here's a painful truth: automating a bad process just makes bad things happen faster. If your current operations are chaotic, your new ERP will just be expensive chaos.

4. Change Resistance

The best ERP in the world is worthless if your people won't use it. And they won't use it if they weren't involved in designing it.

How to Actually Succeed

The companies that succeed with ERP do three things differently:

1. Design before digitize: Fix your processes before you automate them

2. Own the requirements: Don't let vendors define what you need

3. Invest in adoption: Budget 20-30% of your project for change management

The Bottom Line

ERP success isn't about picking the right software. It's about having the right approach. The companies that understand this save millions and actually get the transformation they paid for.

Ready to de-risk your ERP journey? Talk to us about our ERP Risk Advisory services.