Why do so many ERP projects fail?


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C

Chantal Rochelle

My sentiments exactly.

What is often perceived as 'risk avoidance' is often in fact 'blindly risk
taking'.
By copying what they believe others have decided before them, based on vendor
'notoriety',
they avoid making new, innovative, decisions, based on facts and suitability to
their needs and competence.

Such organisations are typical 'followers' and they are always, at best, second
to other organisations in their field.

They will never be 'number 1'.
 
C

Ch. Witherspoon

To me, this sounds like a plausible explanation:
http://www.vansomeren.com/erp/info/ERPfail.htm
You are so right!
When people see stock prices of ERP companies rise, they assume that
the ERP product that this company sells is good. In many cases,
however, the opposite is true; stock prices may be influenced by other
elements than by 'company results'. And 'company results' may be
influenced by other matters than by 'product sales'.

For instance: many ERP companies that sell shitty software rake in
huge amounts on maintenance revenues. Why isn't this a red flag to
prospective clients???
If a software vendor has a good product, should it not require little
maintenance or no maintenance at all???
If a software vendor has a good product, shouldn't it be reaaal easy
to install, implement, learn, etc…?

A great example of CLIENT INCOMPETENCE is their reanimation of 'BaaN
Software'. Only a few years back, BaaN's slick sellers conned Boeing
into buying their software. Boeing bought a 'sales pitch' but got
crap. It took Boeing quite some time to realize and to admit this. In
the mean time, BaaN's slick sales reps bled the opportunity dry to
refer to having Boeing as their customer. And it worked. Even long
after Boeing's public admission of having made a huge error to do
business with BaaN, and after the Baan-brothers had cashed-in and
high-tailed out, and after BaaN stock had plummeted and BaaN had been
taken over, even after all this, clients only seem to know 'BaaN' as a
'familiar name' and those morons seem to line up to get their share of
crap.

They will get what they deserve, I guess.

Being stupid costs money.


Charles T. Witherspoon
 
T

Tony Bryer

Ch. said:
For instance: many ERP companies that sell shitty software rake in
huge amounts on maintenance revenues. Why isn't this a red flag to
prospective clients???
If a software vendor has a good product, should it not require
little maintenance or no maintenance at all???
We sell good software to architects, engineers etc and charge modest
amounts for maintenance. We play fair with our users and fix bugs and
incorporate wish list items as soon as we can. It's a win-win
situation: we get a continuing revenue stream that justifies us doing
this, and they get these things now, not a in year as part of some
expensive upgrade. My late father's maxim was that you always wanted
suppliers who were making money off you - a reasonable, not excessive
amount - as they would be around for the long term.

I would be interested to know what the general policy on accounting for
such payments is: we put them on the BS as a liability and draw down
17.5% in month 1, then 7.5% x 11 in successive months.
 
M

Merlin

I would not know what the 'general policy' is, or if there even is
one. I do know right from wrong. I do know that if a client has bought
a product and finds something wrong with it, he/she should not have to
pay extra to subsidise incompetent manufacturers to correct their
mistakes.
I do know that it is wrong to charge a client for a product and then
charge this same client extra to get the product that he had expected
to get in the first place.

I know that if you would buy a Van Someren ERP product, you get free
updates resulting from bug fixes (if any) within the first three
months after your purchase. To me, that is fair. It shows their
confidence in their products and, more importantly, it shows the
respect they have for their clients. Unfortunately, I do not know any
other software company that possesses this integrity.

If you would buy bread with roaches in it, would you accept it? Would
you accept the offer from your baker, to come by his store every day
for one week with a couple of slices of this bread and pay this baker
daily so he can 'expertly' remove the roaches for you?

Stupid example, huh? Or is it? In this 'win-win situation' the baker
gets a continuing revenue stream and the customer (eventually) gets
bug-free bread. Why is it that when we translate 'software' into
'bread' it is more obvious that a client should shop elsewhere if he
is charged extra to get what he paid for in the first place? Why do we
find it so easy to accept that people who buy software licenses are
treated as milch cows?
 
T

Trevor Hymes

I'd say not only plausible, but also pretty bloody accurate.
 
J

John Wayne

True. We are herd animals. We'd rather all be wrong than stray from the
herd and risk being the only one who is right. It just feels wrong, I
guess.

Johnny
 
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K

Kate Lilyfield

Hey, if even 'the Duke' saw it fit to rise from his grave and share his
wisdom with us, who is arguing?

;-)
Kate
 
A

A. L. Meyers

This is one more illustration of the fact that humans are only to a very
limited extent rationally driven. Herd instinct, prestige, etc. are
generally far more than rational economic self-interest. Add this to
the adage "appearance counts more than reality" and we discover why it
is so easy for politicians and managers to resolve issues by ignoring
them.

We may, however, gain some consolation from the fact that the raging
epidemic known as "homo sapiens" will, like all other epidemics,
subside.

A. Lucien Meyers, CIA, CMA
 
A

A. L. Meyers

This is one more illustration of the fact that humans are only to a very
limited extent rationally driven. Herd instinct, prestige, etc. are
generally far more motivating than rational economic self-interest. Add
this to the adage "appearance counts more than reality" and we discover
why it is so easy for politicians and managers to resolve issues by
ignoring them.

We may, however, gain some consolation from the fact that the raging
epidemic known as "homo sapiens" will, like all other epidemics,
subside.

A. Lucien Meyers, CIA, CMA
 
P

Pete Flemmix

But what does this tell us about the ERP implementation companies of those 'big' ERP vendors? Does this mean that
they are innocent victims because the software they are trying to implement is so ill-constructed that it simply
cannot be implemented (as advertised and desired)?
Does this mean that they are accomplices of the manufacturers of 'hollow' ERP products by 'supporting' weak
products/vendors and with their support give (prospective) clients a false sense of security?
And then the consulting firms that have advised their clients to buy a familiar brand name but withholding facts
about limited applicability, suitability, failing implementation and huge costs of ownership. Are they guilty of
legal offenses?

Pete
 
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P

Pete Flemmix

But what does this tell us about the ERP implementation companies of those 'big' ERP vendors? Does this mean that
they are innocent victims because the software they are trying to implement is so ill-constructed that it simply
cannot be implemented (as advertised and desired)?
Does this mean that they are accomplices of the manufacturers of 'hollow' ERP products by 'supporting' weak
products/vendors and with their support give (prospective) clients a false sense of security?
And then the consulting firms that have advised their clients to buy a familiar brand name but withholding facts
about limited applicability, suitability, failing implementation and huge costs of ownership. Are they guilty of
legal offenses?

Pete
 

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