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By: Anju A.P

ERP Implementation Failures in Middle East

As your business starts expanding, the intensity of management gets tougher and harder. The necessity of an online database that stores an abundant amount of information and that executes the procedures efficient and quicker becomes inevitable. The database, in other words, an ERP can be of great help to the business organization while comparing to the performance of the in-house group of individuals.

  

Dating back to the history of ERP, it was in the 1960s, that J.I. Case and IBM, developed together with the Enterprise Resource Planning (ERP). The innovation helped the business in proficiently overseeing and incorporating the most significant business parts. The Enterprise Resource Planning software simply modernized the business procedures via reengineering the present business forms. 


erp implementation failure middle east



As you see on top, in spite of the fact that ERP software was first intended for planning and scheduling materials, it instantly turned into the most complex and largest enterprise framework that offers cost-effectiveness, improved management, business development, and backing for business processes. It made a significant footprint in integrating together the business departments that were working silos, restricting the growth and expansion of the business. 


Today numerous business organizations have taken up the utilization of ERP software to deal with their systems, resources, and different business activities. Today ERP is viewed as a dynamic device for business achievement because of its capacity to execute flawless transactions and productions. Unlike earlier, ERP is no more a phenomenon restricted to the developed countries, however, has spread across the developing countries as well.


ERP implementation in Middle East Countries 


The major reason behind the adoption of ERP systems among the developing countries across Middle East was to be on par with the economic expansion happening worldwide. Besides, it was also to compete with Western Enterprises who put up great pressure and fiercer rivalries for those in developing countries. 


However, the countries of the Middle East like Bahrain, Lebanon, Kuwait, Saudi Arabia, Oman, Qatar, Syria, UAE experienced many challenges with respect to their ERP implementation. Factors running from cultural differences, resistance from users to adopt the new framework, the inadequacy of information technology, lack of experience, further the government approaches, seriously affected the implementation of ERP in Middle East.


The fruitful impacts of ERP execution were not seen same with all countries. For instance, the use of ERP solutions in the Middle East enabled the countries to remain focused and stay competitive in the worldwide market. However, the degree of acceptance to the new data framework constrained them from achieving the full benefit. The user acceptance in different middle east nations contrasted with that those of developed nations. 


One of the major and primary reasons behind the failure of ERP in the middle east countries can be called as the mismatch between the ERP framework and the client culture. There exists a high degree of reluctance and rigidness from the side of the user towards the adoption of new technology. A major percentage of users among the middle east countries prefer the software to work in accordance with their aspiration rather than making themselves flexible to the software workflow. Thus the users demand over customization in the ERP framework, creating turbulence in the standard workflow, hampering its good run.


As of it, in spite of the huge investment made, the ERP frameworks fail in many business organizations across the middle east. This simply denotes to the fact that the success and advantages of ERP partially relies upon its end user; workers. It is how the end user acknowledges to the software and truly makes out if, undermines the success of ERP software. 


Often this contrast in the middle east countries like Oman, Saudi Arabia, UAE, or any. The social contrasts or the cultural differences among the users there, seriously affect the success of ERP implementation. In many cases, the expected outcomes were not seen post the implementation. This is primarily because of the over customization and the user’s lack of understanding of what is anticipated from them. 


One must understand that a successful ERP implementation is an outcome of minimal customizations. This not only saves the time and expenditure of the business but also significantly reduces the risk of ERP implementation failures. Because, over customization often leads to the distortion of the standard workflow of the software, and also decreases their benefits if not executed properly. 


Quick review to the Middle East’s ERP implementation failure factors


1. Absence of strategic management planning

2. Resistance from Users

3. Over-customization

4. Absence of adequate abilities/experience 

5. Absence of framework/innovation 

6. Absence of training and key resources 


Where one side you hear the success stories of ERP implementations, on the other side you hear about flops/ ERP failures. The astonishing fact is even some of the well-known brands like FoxMeyer, Hershey, and Nike reported the case of failed ERP systems. There exists a large percentage of business organizations who remain still reluctant to the adoption of an ERP system. The factors such as


1. Interruption of core business operations

2. Lack of implementation experiences

3. Fear of a failed implementation 


holds these business organizations from getting the ERP implementation done. They fear about the deliverables of ERP, say the conveying of anticipated results, also fear that the failure of ERP systems can never be foreseen and their success can never be guaranteed even in the best circumstances.


Critical Success Factors of an ERP 


Everyone realizes what are the key success factors of an ERP implementation are. However, the basic achievement factors keep differing according to the organizations and the countries. Because, the critical success factors are nothing less than the structure, the size and the aptitude of that organization. In the Middle East countries, we found what are the reasons behind their ERP failures. The major contributing factor was the social conflict among the user. 


Likewise, poor resource allocation, unrealizable desires, and a changing requirement during the implementation process can significantly hamper the ERP execution procedures. However, in case if all prerequisites are fulfilled on time and resources allotted in the right manner, the implementation can go flawless until the Go-live phase. No maintenance shall be called forth until there is any demand for small changes in the business forms. 


Yet another critical factor is the Business process re-engineering. This is extremely a significant stage in light of the fact that the package may not support all the business procedure and therefore customization is required. The achievement rate thus purely depends on the proper and correct execution of the customizations.


In addition to the above, the lack of learning about ERP packages and good vendors also prompts to make the wrong decision. Many opt for freelancers over certified ERP consultants in terms of saving money and other assets. Consequently, the ERP implementation turns out to be a flop as they may not satisfy the business necessity in the long run. The cheaper option turns out to be highly expensive for the business in their future course. Read the advantages of choosing certified experts over freelancers 


Assuredly saying, with the help of a good ERP consultant, the business organizations can get relieved from the tensions of proper strategic management, proper allocation of resource and efficient project management. A good ERP consultant can help you with rightly identifying the current business challenges, proper planning and developing of the software application, also laying the need for customized solutions if any. Simply saying, a good ERP consultant can assure you with flawless ERP Implementations, integrations, migrations, and prompt support.


Cybrosys is an exponent in Odoo consultancy and has been titled as the best Odoo consultant for Odoo ERP implementation and Odoo ERP Customization. Those business organizations who are looking for good consultants for their project execution can avail best quality ERP consulting service from expertise Odoo Consultants of Cybrosys. To understand the checklist of a good ERP consultant refer to our blog: Who is a Best Odoo ERP Consultant?





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