9 VERY Scary ERP and ERP System Implementation Statistics

Last Halloween we shared with ERPVAR blog readers a blog that outlined 7 ways to survive and ERP implementation and a horror movie- two situations where you want to know what you’re doing, that’s for sure.  This year we wanted to share with you some frightening facts and statistics about ERP system implementation we think every business should be aware of.

• Hershey's failed to deliver $100 million dollars in candy for Halloween 1999 after a troubled ERP implementation caused serious operational problems (CIO Magazine).
• 61.1% of ERP implementations take longer than expected (Panorama ERP study).
• 74.1% of ERP projects exceed budget (Panorama ERP study).

• 2013 1/3 of ERP buyers did not even demo a product before buying it! (Capterra).
• 22% of companies surveyed reported they just bought the first system they looked at (Capterra).
• 67% reported that they need a solution with more industry-specific functionality than their current ERP system gives them (Mint Jutras).
• 21% of ERP implementations fail to deliver significant business benefits (Panorama ERP study).

• 58% of manufacturers report they are doing too much non-value-added work (double entry in multiple systems), which is impacting productivity. Why? Because they are not using an industry-specific ERP system (Mint Jutras).
• 40% of ERP implementations cause major operational disruptions after go-live (Panorama ERP study).

• 23% are unable to grow their business as quickly as they would like and believe this to be because they lack the tools they need in their current ERP system (Mint Jutras).

• 74.1% of ERP projects exceed budget (Panorama ERP study).

• 28% report being unable to serve their customers as well as they would like due to a lack of functionality in their ERP system (Mint Jutras).

While some of the stats we shared above are indeed terrifying, they don’t have to become the reality in your organization. Those companies who experience the scary stuff above do so because they rush the process; a prime example being the stat that says “1/3 of ERP buyers did not even demo a product before buying it!” and “22% of companies surveyed reported they just bought the first system they looked at.”  When companies fail to take their time during system selection and overlook key aspects, they often end up like the companies above. But if you do it right, take your time, and avoid ERP implementation mistakes like these, your results are going to look more like this:

• ERP systems that provide accurate, real-time information about daily operations help companies reduce operational costs by 23% and administration costs by 22% (Aberdeen Group).
• 15% of ERP projects perform no customization (Panorama ERP study).
• Modern ERP systems can increase on-time deliveries by 24% due to improved productivity, enhanced order tracking, and informed decision-making (Aberdeen Group).
• Midsized companies that implement modern ERP systems can support change and grow their operating margins by 21% (Aberdeen Group).
• On average, ERP systems reduce order-to-shipment times for distributors by 23% (Aberdeen).
• 74.1% of ERP projects exceed budget (Panorama ERP study).
• With modern ERP, distributors deliver complete and on-time shipments 97% of the time (Aberdeen).
• ERP Streamlines workflow automation, allowing companies to reduce operating costs by 22% and administrative costs by 17% (Aberdeen).
• Modern ERP systems allow distributors to achieve an inventory accuracy average of 97% (Aberdeen).

Related Reading: ERP Implementation Strategies: The Pros and Cons of Big Bang vs. Phased Roll-Out

by Jeanne Lee

Image source: freedigitalphotos.net