3 Ways to Avoid ERP Failure

Written By: Nathan Stroeher
Date: November 12, 2020

They say learn from your mistakes, but equally important is the value gained in learning from the mistakes of others as well. Each year hundreds of extremely successful organizations experience subpar or failed digital transformations each providing nuggets of educational elements we should all consider when embarking on our own digital transformation journeys.

Take the example of one of the worlds leading athletic footwear apparel companies. A few years back, they spent $400M on a digital transformation initiative only to experience a $100M deficit and a 20% drop in stock prices. The project veered off track resulting in an additional 5 years and $400M investment before they were able to finally optimize the project and experience measurable results.

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Learning from others mistakes, we ask what steps can we take to avoid the common pitfalls and ensure we are setting ourselves up for a successful software integration? Are there certain elements of the transformation that carry more weight in their impact on the success of a project?

The answer is yes. Many times, companies overlook certain aspects of the process or try to cut corners in areas where they should be investing more time, $, and effort. Below are 3 areas to focus on to ensure the success of your next project:

1. Select the Right Software

Before starting any digital transformation engagement, organizations must first develop a clear understanding of where they stand today, where they wish to be in the future, and what comprises the gap between the two. A well-written gap analysis outlines those areas preventing a company from operating at 100% efficiency and achieving their goals in the future.

Requirements derived from the gap analysis will provide a detailed understanding of the requirements to be met by the chosen software solution. Different solutions have different functionalities that alleviate pain points based on your company’s unique differentiators. It’s important to first understand who you are at the core, what your strategies and pillars are, and your core mission before you dial in on where you are going in tomorrow’s software integration that will last you for years to come. As a knudge in the right direction, here are top ERP solutions to be aware of depending on your industry, size, location, and many other factors that set your company apart from the rest.

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2. Choose the Right Partners

Having the correct people in place, both internal and external to the company greatly enhances the odds of achieving a successful outcome. Organizations must clearly create a solid digital strategy, implement a strong organizational change management (OCM) plan, and define the technical needs required. A strong internal and external resource base must be in place if a project is to be successful.

With the right resources in place, the job of choosing the software can begin. It is important to address any unspoken biases for or against a specific software solution. While past experience is an important factor in any choice, organizations must view each solution in light of their own needs. For example, the CFO who previously implemented Oracle or the IT lead who has worked with Infor in the past should consider how that solution will satisfy the needs of the current organization and not give preference when doing a comprehensive, unbiased software selection.

Likewise, when hiring a third-party consultant to guide the selection process, it’s important to recognize that many consultants are structured in a way that incorporates commissions from software vendors as a key part of their revenue stream. These special interests will likely be reflected in their recommendation, and while not necessarily a bad thing, it is important to be aware of any relationships that exist. The best way to avoid this bias is to pursue a technology-agnostic consultant to aid in your transformation who will ensure there are no biases in their recommendations to your company.

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3. Take Ownership

Knowledge is power, especially during a project of this scale. Educate yourself on best practices of a digital transformation and always do your due diligence. Below are tips to set you off in the right direction:

  • Draft a business plan straight out the gate that will work as guardrails to the project and limit the chances the project will deviate from its desired outcome.
  • Course correct and address any consultant team member who is not meeting expectations and delivering solutions.
  • Identify and mitigate risks and make sure these mitigation techniques are implemented throughout the project. The risks you face are unique to your company and there is no out of the box answer to your unique situation.
  • Avoid cutting corners and quick-fix solutions. Don’t try to compress the timeline, skip necessary steps, or skip valuable OCM efforts. Clearly define and work toward a complete digital transformation solution in order to achieve a fully optimized outcome.


How you start the journey has a lot to do with how the journey ends. The key is to stay involved in every component, even when outsourcing certain elements of the transformation project. Nobody knows your company like you and your team, and it’s important to approach it with the intent of finding the glove-like fit that will set your company up for success for years to come.

If you’d like to discuss your digital transformation journey or even informally review the challenges you’ve seen in your project already underway, feel free to contact me directly. I am happy to be a sounding board.

Stroeher, Nate
Nathan Stroeher

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