There are multiple reasons why ERP fails as new systems are deployed into companies. Outside of the two primary factors, poor sponsorship and or leadership engagement and lack of project manager experience, there are six elements of why ERP fails that should be considered as companies consider ERP transformation:

1.Lack of User Involvement – Without user involvement nobody in the business feels committed the ERP system, and can even be hostile towards its utilization within daily management. Users need to be involved from the start, and continuously throughout the development. This requires time and effort which sometimes is not high on an organizations priority.

2.Poor Requirements Definition – Too often, ERP projects have high level and vague requirements. This has led to cases where IT developers, having no input from the users, build what they believe is needed, without having any real knowledge of the business. Inevitably when the system is delivered business users say it does not do what they need it to support the business need.

3.No Change Control – Business change is happening at a faster rate than ever before. So it is not realistic to expect no change in requirements while an ERP system is being built. Uncontrolled changes will play havoc with an ERP system under development and will cause many project failures.

4.Scope Creep – Scope Creep is the insidious growth in the scale of an ERP system during the life of a project.  Scope outlines the holistic measure of the project’s implementation; therefore, the slightest change in the effort’s scope can have severe ramifications between module dependencies being implemented properly.

5.Unrealistic Time Scales – Long timescales for a project have led to ERP systems being delivered for products and services no longer in use.  The business model has surpassed the system’s ability to support the business need.  Time scales should be short so that the project team can deliver the appropriate ERP solution to end-users.

6.Lack of Sub-Project and Deliverable Integration – Misunderstanding deliverable dependencies and the architecture of an ERP system’s expected support features is critical.  Without clear relationships mapped between modules, project failure is certain.

As is outlined above there are six fundamental elements to consider why ERP fails.  Taking these six factors into account can separate the difference between successfully implementing a system and failing to meet customer requirements.