Why do most ERP implementations fail, and how ERPNext can reverse the trend?

Let’s face it. Most ERP implementations fail. The implementation goes on and on but never ends. Spends millions on that process. Both the implementor and the client become fatigued. They haggle and renegotiate, fight like a hateful couple forced to live together. Finally, the project gets dropped, completely, or partially. Partially suggests that they just chose to continue without accomplishing most of the goals and make do with what little they had.

Every business owner thinks his or her business is unique. Nothing wrong with that. She or He might have put forth a lot of effort and traversed many paths, most of it must have been unconventional. Fair.

But on accounting terms, his business is just another one. Everything he needs to do with his accounting, inventory, bookkeeping, taxes, and so on is just normal like every other business, well, at least 99% of them.

Because every owner believes his or her company is unique,  he or she is always on the lookout for unique software. Two types of offers come to him. One. Develop his own ERP. Two. Customize an existing ERP. The first one comes from local developers with an offer to finish with few thousand dollars. And the second, just to begin, they ask for a few million.

Scenario 1: Develop his own ERP

He finds someone to develop new software, which some developers promise to do with a small budget, and in a few months, eventually fails. 

Why do they fail? Because, these small companies try to build ERP systems that require thousands of hours of programming, rigorous testing, and documentation. What they have are very few inexperienced programmers. The entire exercise is destined to fail. No study, No planning, No testing, No documentation. Initially, they show tremendous progress and companies agree to go live. The moment they go live, there begins the conflict.

Conflicts. As it is supposed to be the ERP designed for their own needs, accountant and other users feel empowered to ask for any changes in the system as they wish, or as they fantasize, even if the change goes against the standard accounting practices. And the developer is compelled to change as the contract says that. It goes on and on until the whole experiment fails.

Scenario 2: Buy a standard ERP and customize it.

The common and reputed ERP vendors like SAP, Oracle Fin, Dynamics, and some regional ERP vendors, through their handsome salesmen with expensive ties and suits, offer the best ERP in the world with unlimited customization and never-ending support. No strings attached, they say. 

Strings, there are many. Every second thing you ask them comes with a string. It requires an add-on, the hapless programmer tells you the moment you shout at him. Everything is either an add-on or a separate module that you need to buy again.

Buying add-ons look simpler, compared to locked source code. It is not possible, the developer often tells you, with a grim straight and hidden glee. Why not, you shout back, it needs change in the source which is not available, developer answers.

Such conflicts go on and on. As I said earlier, until either it dropped, or you decide to continue with whatever little you have.

Solutions.

We, at ERPGulf, tried to turn this trend a few years back and achieved remarkable success on that. Let me explain how we have done that, which probably can help you as an implementor.

Step 1: Tell your customer, bluntly, on his face, that your business is not special. 99% of the businesses across the world use the same accounting practices. It is time-tested, grown through centuries. And if you are thinking you are that 1%, you are in bad company.

Step 2: Discourage any major customization, except minor changes like printing formats, adding some form fields here and there, etc. The moment you start customizing everything, the destiny of the project is written, it’s doomed.

Step 3: Convince the company to change its practices, yes, you heard it right. As a consultant, it’s your job to advise the customer. The advice does not mean praising. Companies have wrong accounting practices, accumulated through decades, came through manual book-keeping, and wrong standards. They need to change all of that, to become modern, adopt growth and become compliant with new regulations. All well-reputed ERPs are following modern practices. Companies should change themselves to match with ERP, not the other way around.

Step 4: Don't spend millions on ERP. Use open-source. 

Here comes ERPNext. 

Why ERPNext 

1- Entire source code is available to you. I am not suggesting you need to use it as a customer. I’m sure most of you will never use it, rightfully. But it also makes sure that you will never get locked in the future. Never

2- When I say locked, it means both in terms of software and implementor. What we see mostly in this region is, that the system integrator or software implementor disappears after a few years, or they stop supporting the customer. Either they grow big or they shut shop. The customer needs to search new team to support the existing system and it is hard. Hard to find and hard to maintain.

If you are using ERPNext, there are hundreds of trained developers, programmers, and consultants available across the globe. And their tribe is growing. So, even if an implementor shut the shop you get another hundred. And they already know the codebase and the system inside out. Everything runs smoothly.

3- Low cost. Get a cloud instance and run the system. You start using the system from day-1

4- Customization, if at all required, is cheap. All the documentation and support are available on the net. You can hire programmers or consultants anytime anywhere. 

5- All modules are available. No special purchases are required. Everything is open source. 

6- Country-wise customization. Many integrators across the globe release country-wise modules for ERPNext. Local laws, policies, and compliances are done by regional companies, and most of them are published on the internet. You can use it. 

7- More and more professionals get trained on ERPNext, both on the technical and functional sides. There are many institutes that offer training on ERPNext. Online and classroom. We at ERPGulf ourselves trained hundreds. If you want to recruit a trained ERPNext pro, either technical or functional, they are readily available, unlike other ERP systems.

8- Work from anywhere. When everything goes to the cloud, and everyone wants to use mobile, tabs, or computer, from home or office, a modern ERP system needs to have a modern interface and cloud-friendly backend. ERPNext fits right into that area.

The software implementation, especially the ERP, the landscape has changed tremendously. Generations changed, and everyone learned their lesson. After COVID-19 every company wants to adopt work-from-home and cloud environment. They want to move away from traditional on-premise, form-based applications to modern, cloud-friendly one. Hope this article helps them all.

Thanks for reading.