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10 Epic ERP Failures in 2011


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    Enterprise Resource Planning (ERP) can be a tricky business. When all goes well, a business reaches unimaginable levels of success, but when problems arise, companies can find themselves in ERP hell. With the start of a new year, Computer World highlighted some of the epic failures in the ERP industry in the last 12 months:

    1. The UK’s NHS IT Flop - After spending close to 12 billion pounds (US$18.7 billion), the National Health Service (NHS) in the UK determined that a project to provide electronic health records for all citizens was not going to happen.

    2. CityTime Project in New York City - This project failed partly due to alleged criminal activity and a budget that swelled from $63 million to $760 million.

    3. Ingram Micro and its SAP Problem - At some point, it is time to admit defeat. Such is the case with Ingram Micro’s drawn-out attempts to implement SAP products in Australia. Twice now, the failures have directly affected Ingram Micro’s income, as it dropped from 70.3 million to 56.3 million.

    4. Oracle and Its Love of Lawsuits - Montclair State University claims Oracle royally messed up a PeopleSoft project and filed suit against it. Oracle retaliated, claiming it was the school’s fault. So much for “the customer’s always right.”

    5. Epicor Deals with Its Own Lawsuit - Calling the implementation of its project a “big mess”, furniture seller ParknPool sued Epicor when it failed to deliver on a seven-week project that lasted seven months.

    6. SAP Accused of Racketeering - Like something out of a novel about a crime family, SAP found itself in federal court over allegations of a racketeering scheme involving Deloitte Consulting and its project with Marin County in California.

    7. Epicor Sued...Again - Are we seeing a pattern here? When an estimate of $190,000 ends up costing a company over $1 million, you can bet that a lawsuit is on the way. This appears to be a normal day’s work for Epicor.

    8. Unisys System Baffles Idaho, Costs Millions - It was designed to handle health care claims, but a new auditor’s report warns that failures of the system could end up costing Idaho millions in losses.

    9. Lawson Involved in Lawsuit - Yet another ERP vendor, Lawson, found itself on the wrong end of a lawsuit from CareSource Management Group, a health care plan administrator. Lawson promised a “fully integrated” system but failed to deliver, according to CareSource.

    10. IBM and SAP Fail Hand-in-Hand - The Victorian Order of Nurses just could stop complaining when their payroll system failed to correctly pay their nurses. Some got shortchanged while others received more than they were supposed to get. A simple failure in correct ERP implementation resulted in this disaster.

    If we have learned anything from 2011, it is that ERP customers expect to get what they pay for and receive ERP systems that actually work as advertised. No one likes to be blindsided, but history has repeatedly demonstrated that many large ERP vendors are not prepared to handle the tricky business of dealing with customer concerns and the changing winds of business.

    We are glad to see that Microsoft Dynamics products did not make it in this Top 10 list! Even Microsoft Dynamics AX, which is implemented in large, global, organizations like the ones mentioned above. So if you are trying to compare Micorsoft Dynamics AX with products like Oracle, SAP, Lawson and Epicor don't forget to check their references.

    By ERP Software Blog Editors, Find a Local Microsoft Dynamics ERP Partner

    4 Responses to “10 Epic ERP Failures in 2011”

    1. Dear Anya,

      I am hunting for ERP failures since my personal belief is that ERP is failure-proof (all ERP systems). This list is not reliable – some are not about ERP systems. No one of listed SAP projects is failure. I presented something about:
      http://scn.sap.com/community/asap-methodology/blog/2012/09/21/alleged-sap-erp-failures-in-2011
      http://scn.sap.com/community/asap-methodology/blog/2012/10/11/the-case-of-marin-county-there-is-no-reason-to-replace-sap-erp

      I am looking now for ERP failures in 2012 to evaluate.

      Regards

      Waldemar

    2. Thank you for sharing. If I may be so bold, many sources speak to the symptoms that result in ERP implementation failure but few speak to the root cause of these failures. The root cause has more to do with the wrong implementation strategy. Today, the majority of ERP implementations follow a traditional, “build-from-scratch” approach that is not adequate for implementing packaged software like ERP. What is required is an approach that addresses both the inherent advantages and challenges associated with ERP. Following are key principles to assist you in build the right ERP implementation strategy.

      http://gbeaubouef.wordpress.com/erp-business-solution-manifesto/

    3. ERP Administrator says:

      Paul – this list was compiled by ComputerWorld – not a Microsoft ERP vendor. We just chose to report on it!

    4. Paul says:

      It looks a little strange coming from an Microsoft ERP vendor and not having Microsoft make the list…

     

     
     
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