Lidl SAP implementation failure (ERP Failure serie)

The companies acquire ERP systems helps them in managing work with a balanced flow and in a more organized way. They get to have easy access to the information, manage different departments from a single platform. Some companies wanted to streamline their business and started implemented ERP systems but had to meet the failure. 

In one of our previous blogs, we discussed one of the ERP failed projects/ERP failure example, i.e. Hershey ERP failure. Companies looking for failure lessons and failure factors of ERP implementation can have a lot to learn from it. There are many reasons for these failures. In this case study, we are going to talk about the Lidl SAP implementation failure. Let’s help you take a walk through their failures for your understanding.

 

benefits_of_erp

How it all started?

Lidl implemented SAP three years ago, considering their step towards a transformative journey. The goal was to meet the market ends for innovation and efficiency. Initially, they went live with the merchandise management at its Austrian stores in May 2015. The roll-out plan was to reach 10,000 stores and more than 140 logistics hubs. However, now the recent news states that Lidl is dropping the project worth €500m project.

 

Why did the project fail?

 

A recent survey study based on 113 individuals shows that across the SAP has failed to companies have failed in the SAP implementation. The reason is common, and that is SAP, not meeting the expectations of the company. The reason for the Lidl SAP implementation failure was:

  • It shows that customization is not one of the strengths of the SAP system. Projects are completed successfully with a specific model. Changes, however, demand more and fail SAP.
  • In the case of Lidl, it demanded a higher cost for consultation and implementation cost consider the adjustments.
  • The company also states that the problem has risen despite the technology solution.

A Lesson Learned

 

We all know that the system is supposed to ease up the process and help organizations in reaching a higher level of success. Now, most companies fail as they lack business engagement. So, with the failure of Lidl SAP, we have learned to:

 

·Open to Business Process Reengineering

 

A willingness to improve process engineering will help you define the helpful processes and separate the changes you need. You need to look closely at the requirement gaps and fix them.

 

·Follow the defined timelines

 

The Lidl project spanned around seven years. See, the problem lies in the timelines. You have to adhere to them. Competition doesn’t stop, and the market keeps moving on. So, avoiding intensive customizations will help companies in following deadlines or timelines in a better way.

 

·Ensure executive alignment

 

Since the team was in constant fluctuation, managing business alignment or buy-in became tougher. So, it is important to maintain the focus.

·Prioritize organizational change management

 

Prioritizing internal growth in the team is also important. It seems easy, but it is not. You have a focus on training during the project implementation and help the team understand the smart use of functions.

 

DFSM ERP Rescue failed project

 

DFSM can help you in saving your time and money. Talk to our consultants, and they can assess if the project is failing or not. So, they can offer immediate solutions along with the training to help the team learn better use of the ERP system.

ERP implementation failure a case study 2020

ERP implementation failure a case study 2020

 

Failure is a scary word. You hear it and think it is something with the thorns. But this is the one thing that teaches you the most valuable lessons. Businesses like to upgrade and even if they don’t, the demand of the market will make them do it.

Now, failure and businesses go hand in hand. It is not always a story of success and never a failure. There are a lot of ERP implementation failure examples as well as successful examples.

So, when it comes to upgrading, organizations think of every possible investment they can make for the sake of efficiency. The client has nothing to do with resources; the only thing he demands is efficiency and on-time work delivery. So, Enterprise Resource Planning (ERP) is one of the systems that make sure of it.

It is an amazing Enterprise Software. But usually, implementation of ERP fails. According to some of the facts, it has a more failure rate than success.

If you want, we can name many reasons and including that; the staff in a relaxing mood without analyzing the outcome of ERP software implementation is on the top.

Case Study of the failure of ERP Solution implementation

 

ERP implementation fails due to many reasons, but lack of involvement, supervision, and recognition are the most common.

Let’s study today the case of Hershey’s SAP ERP failure.

 

It is one of the common case studies, and people take lessons from them before investing millions of dollars in the system. And according to the ERP implementation failure statistics, Hershey is one of the most popular case studies for that matter.

If you are a business owner or going to be a future CEO of any company. Bear one thing in mind, along with the decision making power, the timing for business benefits is the most important thing. Hershey’s made the mistake in scheduling. These are the three mistakes that lead them to the failure of ERP Solution.

hersheys ERP fail

 

  • The operational team of Hershey’s made a terrible mistake of sacrificing systems testing for the sake of convenience. So, no issues came into attention. By the time they get to know, it was too late. If you want to provide real-time experience to your clients, you must sure real-time testing process too.

 

  • Second mistake of textbook implementation mistake. They tried to squeeze a complex ERP system into a short timeline. When you implement anything new, it demands some effort and not giving it the needed attention and effort is the sole reason for any kind of failure. So, it was an easy way to fail.

 

  • The third mistake was to time the cutover period in a busy season. Halloween is the season of candy, and the staff was not trained for the ERP at that time. Hershey’s ignored the fact and didn’t reduce their orders. So, the ultimate reason for the failure was the non-qualified team as they were not proficient, but had to meet the deadlines and orders.

Other than Hershey, Vodafone ERP implementation failure can also be used as a case study.

 

Conclusion

 

Ultimately, it is all about managing ERP implementation failure as a project management perspective. If you want to avoid any of the failures of ERP implementations, keep a few things in mind, testing the system, time cutover period during the slow business period and never squeeze a complex system into a short time. These are only a few lessons from one case study. You must go through a few others before making any investment.

 

identify the ERP failure factors 

 

We offer a rescue plan if we believe that your ERP implementation falls under the failed ERP project ( please read here) 

 

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