Previously, we discussed the Hershey ERP failure case study, the Revlon SAP failure and Lidl failure amongst others… The articles were meant to help you determine your ERP implementation journey carefully through learning from the aforementioned failures. If you want a smooth and successful implementation of the ERP system, you need professionals to help you. The companies who had to face failure did so because of a few mistakes they could have avoided altogether if they had chosen to work with experts.
Haribo SAP Failure
Haribo is a German candy company that produces gummy bears and other candies. In late 2018, they decided to go live with SAP. Soon after they began experiencing supply chain system failures. This eventually influenced profits, leading to a decline in revenues afterlife.
In some respects, the problem Haribo faced was slightly more subtle and far more likely to occur than some of the other more dramatic case studies. Here are some of the common lessons learned from Haribo about lowering the ERP failure rate.
· Operational disruption is the #1 hidden cost and risk of a poor ERP implementation
Hundreds of millions of dollars have been spent in previous cases, adding to the overall cost of the serious losses. However, this can be avoided as the transition challenges for the average organization are usually subtler when done correctly.
Haribo may not have spent a huge amount of money implementing the SAP or take legal actions against the scheme. However, these failures of the supply chain and profit losses can be of great benefit to many enterprises. Our team’s research over the years has shown that approximately half of businesses experience material damage during digital transformations. This is because the cost and danger are not planned by or mitigated sufficiently by most organizations.
· Business Process Reengineering is Critical
The fact that business processes have been damaged after the go-live suggests that Haribo did not spend sufficient time and effort on their operations management. They did not know what they need to do during their digital transformation in the sense of business process management. For failure to effectively overcome challenges, entities must plan their State businesses’ future processes to align themselves with their overall organizational model.
· Align Your ERP System with Your Organizational Goals
Haribo wanted its international production footprint to increase and its supply chain business to improve. Therefore, they decided to implement SAP. Unfortunately, the features incorporated in the S/4HANA platform may not have completely supported this view.
We suggest identifying your organizational priorities first during the ERP selection process. Which steps will help you get into your brand, and what do you want? You can only understand with such answers which features a new platform should be a priority.
· Never Skip Testing!
It is hard to understand how Haribo went live with the program without testing the supply chain in advance. Effective device testing and the meeting room operators should unveil possible big interruptions like this long before their livelihood. If not, then your research technique is incorrect. Before your digital transformation, make sure you understand the significance of ERP systems testing.(What is ERP testing)
Why does an ERP implementation fail?
Before pulling the plug on their SAP transformation, Lidl spent hundreds of millions of dollars. To ensure that your project does not escalate out of control or harm your activities, Haribo and others need good leadership, dedication, and project governance. Lack of all these qualities is the only reason why these implementations fail badly.
DFSM Rescue Plan
If you are unsure about your ERP implementation or plan or need to know if the system is failing, let us help you with it. Knowing what the problems in implementing ERP systems are can be a huge help. At DFSM we have the rescue plan for you through assessment, consultation, and testing. If you want an instant response, you can check out our form, answer the questions, and see if you are failing and need help. DFSM is always there for you.