ERP Change Management: Why ERP and EPM Implementations Fail
Right now, ERP is one of the biggest conversations in the transformation market. Budgets are being approved, boards are signing off multi-year builds, and finance and technology leaders are finally getting the green light on projects that have been sitting on a roadmap for years. Which makes it a good time to ask why ERP implementations fail, and what organisations can do differently.
It’s not because the software is bad. In our experience, guiding finance and technology leaders through these builds, it’s almost never the platform. It’s what happens around the build, including poor team strategy, a lack of groundwork and ongoing ERP change management that fails to address issues.
The data backs this up. Research puts the overall ERP failure rate at around 68%, and Gartner has gone further, predicting that by 2027 more than 70% of recently implemented ERP initiatives will fail to fully achieve their original business goals. It’s note edge cases that are failing. It’s the majority.
Here are the ERP implementation challenges that most often put programmes at risk.
Jump To:
- The Team You’re Pitched Isn’t the Team You Get
- Budgets That Were Never Realistic to Begin With
- Timelines That Were Built to Look Good, Not to Work
- Skipping Proper Discovery
- Underestimating ERP Change Management
- What Good Looks Like Instead
- The Common Thread
- Where To Start
The Team You’re Pitched Isn’t the Team You Get
Every system integrator sells you their best people. It’s how they win the deal, pitching you a room full of senior, credible consultants who clearly know the platform inside out. Then the contract’s signed, and the reality of resourcing kicks in.
Those senior consultants are already committed elsewhere, and the delivery team that actually turns up is a different one entirely. One that’s less experienced and less specialised, still capable on paper but not the team you bought, and entirely unprepared to handle the realities of implementation and ERP change management.
It’s one of the most common gaps in this market, and one of the hardest to spot until you’re already mid-build.
Budgets That Were Never Realistic to Begin With
Programme sponsors are frequently asked to deliver against a number that was set before anyone properly scoped the work. That’s not because organisations are reckless with their planning. In fact, it’s usually the opposite.
Budgets are under greater scrutiny and many teams are working within tight margins, that even though they were approved with good intentions, are insufficient. Most programme directors we speak to are now trying to make those numbers stretch further than they should.
But underfunding now shows up later as scope cuts and corner-cutting, leaving businesses with systems that technically go live but that were never resourced to be built properly.
Timelines That Were Built to Look Good, Not to Work
Rushed builds create their own problems. If you compress a programme that genuinely needs a year into eight months, and something has to give. What gets cut are the parts of the build nobody notices are missing until go-live like testing and training, or the less glamourous, but essential elements of ERP change management. Addressing these risks early is one of the most important ERP implementation best practices
Skipping Proper Discovery
Most ERP failures can be traced back to the very start of the process, and a rushed or skipped discovery phase. That includes something as fundamental as choosing the right tier of system for where the business actually is, and where it’s heading. A business scaling toward £500m in the next decade needs a different platform to one that’s staying lean. Without a proper discovery and requirement-gathering phase, that mismatch gets built in from day one, and some research puts the proportion of ERP failures that trace back to this initial phase at over 60%.
Underestimating ERP Change Management
If we had to pick the factor that gets most underestimated, it’s this. There’s a common assumption in this market that anyone who communicates well can handle a ERP change management role. In practice, strong change and communications specialists are a specific skill set, and they directly influence whether a new system gets adopted or quietly resisted.
Without strong change leadership, the technology can be exactly right, and the programme can still fail, because the people who are meant to use it never really buy in. Inadequate ERP change management is consistently cited as the single biggest contributor to ERP failure, involved in more than 4 in 10 failed projects.
What Good Looks Like Instead
The businesses that get this right tend to do two things differently.
First, they treat discovery as the project, not a delay to it. Understanding what the business actually needs (now and in three to five years) before committing to a system and a scope.
Second, they think differently about how delivery is resourced. The traditional system integrator model asks you to hand over ownership entirely: agree a number, sign the contract, and trust that the team behind it delivers. You rarely see who’s actually doing the work, or what it’s costing to get there.
There’s a different way to do it that allows you to keep visibility over exactly who’s working on your programme and how. Rather than a fixed team assigned by availability, resourcing is drawn from a wider bench of vetted consultants matched to what each stage of the build actually needs. It’s a model built around transparency over the life of the programme, not just at the point of sign-off.
The Common Thread
None of the five points above is really about technology. They’re about the decisions made before a single module goes live. Decisions like who’s actually resourced to deliver it, whether the budget and timeline reflect reality, and whether the business took the time to understand what it needed before it decided what to buy.
That’s genuinely good news, because it means the failure rate isn’t fixed. Every one of these is avoidable with the right planning and the right people in place early enough to matter. The businesses that get ERP and EPM transformations right aren’t the ones with the biggest budgets or the flashiest systems; they’re the ones that treat the groundwork and the continuing ERP change management with the same seriousness as the go-live date.
Where To Start
If any of the above sounds familiar, or you’re heading into a build and want to know more about ERP implementation best practices and where the risk actually sits, Cedar’s ERP/EPM benchmarking tool is a good first step.
It takes a few minutes to complete and gives you a clear picture of where your organisation currently sits on its ERP or EPM journey, and what you should focus on next.
