ERP Failures: The Hidden Costs of Getting It Wrong
By Change & Transformation

How to Protect Your Business from Expensive and Disruptive ERP Mistakes

Enterprise Resource Planning (ERP) transformations are mission-critical but fraught with complexity. A failed ERP rollout can result in ballooning costs, lost productivity, and operational disruption. In fact, Gartner estimates that more than 70% of recently implemented ERP initiatives will fail to fully meet their original business use case goals, and up to 25% will fail catastrophically.

For CFOs, COOs, and CTOs leading ERP initiatives, the stakes are high. Avoiding the common pitfalls of ERP rollouts requires careful planning, strategic execution, and expert oversight. Here’s how to steer clear of costly mistakes and set your ERP transformation up for success.

5 Costly Mistakes to Avoid in ERP Rollouts

1. Choosing the Wrong Implementation Approach

The decision between a Big Bang vs. Phased Rollout is one of the most critical in an ERP implementation.

  • Big Bang Approach: Deploys the entire system at once. While this may lead to a faster transition, it carries a high risk of failure, overwhelming users and IT teams.
  • Phased Approach: Gradually rolls out ERP modules over time, allowing for smoother adoption but potentially delaying full ROI.

Solution: Engage an independent Cedar Technical Partner, an ERP  expert who can conduct an external assessment, providing CFOs, COOs, and CTOs with strategic counsel on the optimal roadmap and approach.

“Too often, businesses rush into an ERP rollout without considering the long-term impact of their implementation approach. A structured, independent assessment can prevent costly missteps.” Chris Morrison, Group Managing Director at Cedar

2. Lack of Internal ERP Expertise

Many organisations over-rely on system integrators (SIs) without building in-house knowledge. This leads to a lack of internal ownership, making long-term sustainability difficult.

  • If knowledge resides solely with external consultants, businesses may struggle to optimise their ERP post-implementation.
  • Internal teams should be upskilled early to ensure seamless ERP adoption.

Solution: Develop a resource plan aligned with the ERP roadmap, ensuring that internal teams have the expertise to manage and adapt the system after go-live.

3. Underestimating Change Management

An ERP isn’t just a technology shift—it’s a business transformation that impacts people, processes, and culture.

  • Lack of early engagement with end-users results in resistance, slow adoption, and inefficiencies.
  • Failure to create a change management and communication plan leads to misalignment and confusion across teams.

Solution: Implement a structured change management programme that includes clear communication, user training, and estimated ROI projections for board-level buy-in.

4. Poor Data Migration and Quality

Bad data equals bad decisions. Many ERP failures stem from data migration issues, including:

  • Incomplete, inconsistent, or redundant legacy system data.
  • Insufficient data cleansing before migration.
  • Lack of robust data governance frameworks.

Solution: Deploy a dedicated data specialist to conduct a pre-migration data audit, ensuring high data quality before the ERP goes live.

“One of the biggest reasons ERP projects fail is due to poor data quality. Investing in a structured data migration plan early can prevent costly rework and operational disruptions.” Chris Morrison, Group Managing Director at Cedar

5. Neglecting Process Optimisation Before Implementation

An ERP is meant to streamline and improve business processes, but many organisations implement ERP without first optimising existing workflows.

  • Rolling out an ERP on inefficient, outdated processes results in wasted investment.
  • ERP implementations should be seen as an opportunity to improve how the business operates, not just a system upgrade.

Solution: Conduct a QA health check before implementation, evaluating current workflows and identifying necessary process improvements.

A Smarter Approach to ERP Success

ERP failures can be catastrophic, but they are also avoidable with proper planning, risk management, and governance. Organisations that take the time to carefully design their approach, invest in internal expertise, and proactively manage change will see greater success and ROI from their ERP initiatives.

By partnering with a Statement of Works (SoW)-led transformation team, businesses can de-risk ERP rollouts, ensure accountability, and drive measurable business outcomes.

Are you planning an ERP rollout? Contact our experts today to see how our SoW-led approach can support your transformation.