The Root Cause Behind The Failure Of ERP Systems

 Implementation/Consulting ◦ Implementation Engineers lack an understanding of the complexity of the business system ◦ Lack of Staff Management Plan - Attrition ◦ Lack of Documentation  Paying Company (Buyer) ◦ No Education/No Preparedness/All Hype ◦ No Understanding of the impact ◦ No Risk Analysis ◦ No Project Plan

 Buyer ◦ Identify the Need (Not Hype) ◦ The Buyer needs to know enough to complexity  Understand the complexity of the target business system  Either model it or understand a model created by consultants  Understand the Capabilities of the System  Demo it with Sample Data

 Founded 1979, Fortune 100  Wholesale provider of technology products and supply chain services  World’s largest IT distributor, providing sales and logistics services  Based in Santa Ana, California.

 Transitioning from old ERP software and implementing a new one with SAP in Australia. ◦ The rollout of SAP in various regions increased complexity  “Australia which hosts one of Ingram's largest operations has presented some difficulties due to increased complexity in the existing IT landscape”

 The system problems resulted in delayed orders that hurt sales and profit margins in first quarter 2011  Net income = $56.3 million, ◦ Down from $70.3 million in the same quarter last year, ◦ A drop "primarily attributable to difficulties transitioning to a new enterprise system in Australia"

 Systems Integrators are expected to ◦ Give customers a realistic set of project timelines ◦ Deliver on agreed milestones ◦ Staff the job with well-qualified technicians.