ERP systems are one of the most critical technology investments companies make, yet implementation challenges often derail progress. A well-planned and executed ERP deployment can be the difference between failure and success.
In this article we discuss:
Enterprise resource planning (ERP) systems centralize finance, operations, HR, and supply chain, serving as the backbone of modern enterprise operations. By creating a single source of truth for essential data and workflows across business functions, a good ERP solution drives both greater efficiency and more informed decisions.
Most leaders today understand its criticality. Yet many encounter challenges when it comes to ensuring a successful implementation. In fact, Gartner reports that by 2027, 70% of ERP implementations will fail to fully meet their original business goals, and an alarming 25% of these will fail catastrophically.
Because ERP software is one of the most significant financial and strategic investments a company makes, leaders need to understand why failures happen and how to avoid them. This ERP implementation guide outlines those pitfalls and offers a step-by-step approach to maximize ERP value and impact from the start.
Gartner predicts 70% of ERP implementations will fail to meet their goals by 2027.
New ERP system implementation is both a technology initiative and a business transformation. It requires rethinking processes, clarifying who makes which decisions, and configuring systems to reflect how the organization truly wants to operate.
The payoff of a well-executed implementation is significant, including:
Stronger control of finance and operations: Establish consistent processes and gain real-time access to financial and operations data for more holistic financial planning and visibility.
Faster cycles for planning and reporting: Accelerate monthly closes, forecasting, and reporting timelines to make quicker, data-backed decisions.
A foundation for data-driven strategy: Provide leaders with accurate, consolidated information to guide investments and power continuous planning capabilities.
Improved workforce productivity: Streamline workflows and reduce manual tasks, freeing employees to focus on higher-value initiatives.
Enhanced customer satisfaction: Strengthen supply chain responsiveness and service delivery, leading to faster fulfillment and better customer experiences.
Workday research found that smart ERP selection and implementation is also crossing over into talent and recruitment, with 86% of CFOs agreeing that technology selection is becoming more important to attracting, upskilling, and retaining top talent.
But to realize these benefits, leaders often underestimate the organizational and cultural shifts that have to happen alongside technology deployment. A new ERP changes how people work daily—how supply chain managers track inventory, for example, or how human resources (HR) teams manage talent and how finance closes the books.
A new ERP system requires clear communication, structured training, and visible executive sponsorship to build buy-in across the enterprise.
Technology choices also shape outcomes. Cloud-based ERP systems offer the greatest levels of agility, scalability, and innovation, while on-premise systems give regulated industries the deep control they need. Today, many companies choose to adopt hybrid strategies that preserve legacy investments while capturing advantages only found on the cloud.
Successful implementations happen when leaders take time to weigh these trade-offs against long-term goals to align system design with the organization's growth trajectory and risk tolerance.
86% of CFOs agree that having the right technology is important to attracting and retaining top talent.
Smart ERP implementation requires businesses to follow a clear sequence of phases, each designed to reduce risk and maximize value. Think of these phases as a roadmap: by following each step in order, you keep the project on track and avoid the costly mistakes that derail many implementation projects.
Start by taking time to thoroughly assess your business needs and set measurable goals so you know what success will look like. Identify all key stakeholders, including executives, managers, technologists, and end-users, and bring them into the conversation early.
Build a cross-functional implementation team that includes both IT and business leads, and create a detailed budget and timeline that reflect the full scope of the project. The stronger your project planning, the smoother every subsequent phase will be.
Choosing the right system is one of the most critical decisions you’ll make during the ERP implementation process. Don’t just compare feature lists—evaluate vendors on their ability to scale with your business, provide reliable support, and offer industry-specific functionality.
Weigh the pros and cons of cloud, on-premises, and hybrid solutions against your organization’s needs. A smart selection process ensures you won’t outgrow your ERP in just a few years.
Once you’ve selected your ERP, it’s time to map out your business processes in detail. Identify where you can adopt best-practice workflows embedded in your ERP system and where customizations are truly necessary.
Keep integrations in mind so your ERP can connect with other applications, such as your CRM, payroll, or supply chain systems. Document every decision—this will keep your implementation transparent and maintainable in the long run.
Data is the lifeblood of your ERP. Before migrating, cleanse legacy data to remove duplicates, errors, and outdated records. Standardize formats and establish validation rules so that the new system receives high-quality data. Break migration into stages, test thoroughly at each stage, and involve business users to confirm accuracy.
Testing confirms the system actually works as designed, and training ensures your people can use it effectively. Run pilot programs with a subset of users to uncover issues before full rollout.
Build comprehensive training that mixes classroom instruction, self-service modules, and hands-on practice. Communicate not just how the system works but why it matters, so employees understand the value and embrace the change.
In an ERP implementation, go-live is more like the first day of a marathon than a finish line. Use a detailed checklist covering data, integrations, user accounts, and security. Communicate the go-live plan across the organization so employees know what to expect.
Have dedicated support staff and escalation paths in place to address problems quickly and keep disruptions minimal. A well-orchestrated ERP launch builds trust in the new system and instills confidence across the entire organization.
The real value of ERP comes after go-live. Continuously monitor performance metrics, user adoption, and system stability. Gather feedback from end-users and act on it to refine processes.
Schedule quarterly or semiannual reviews to align system updates with changing business priorities. Treat optimization as ongoing—not just a one-time or periodic task—so your ERP continues to deliver value as your company evolves.
Every ERP project encounters hurdles, most often tied to people and processes rather than the technology itself. Common challenges include resistance to change from employees, budget and timeline overruns caused by poor project planning, difficulties migrating legacy data, lack of visible executive support, and complex integrations with other systems.
These issues happen because ERP fundamentally changes how people work, and without careful preparation, organizations can stumble. The good news: each challenge has proven ways to mitigate it. Here are five best practices to help keep your ERP project on track:
Tie ERP directly to strategic priorities: Anchor the system to outcomes like faster closes, stronger compliance, or improved customer service so value is tangible.
Invest in change management and skills building: Start preparing teams early, provide structured training, and create champions who can advocate for the new processes.
Communicate constantly and consistently: Set up regular updates, feedback loops, and two-way dialogue so stakeholders remain informed and engaged.
Roll out in manageable phases: Implement modules or functions incrementally to capture early wins, and keep momentum high.
Engage end-users as co-creators: Involve employees in design, testing, and feedback so they shape the system, feel ownership, and adopt it more readily.
Closing these gaps early improves enterprise risk management and sets the tone for a smoother rollout. When leaders approach challenges proactively and embed best practices into the implementation process, ERP implementation can stay focused on enabling innovation and growth. Ultimately, this combination of foresight and discipline is what turns a complex transformation into long-term success.
ERP implementation is a significant investment, and understanding cost drivers up front helps you plan effectively. Core factors include:
Software: The core application and modules you license for use
Licensing fees: Recurring or one-time charges to access and maintain the system
External consulting or implementation partners: Fees for experts who configure and deploy your ERP
Training programs to get your workforce up to speed: Costs of structured learning and support to ensure adoption
These are the visible costs most organizations expect. But beyond those, pricing models differ depending on whether you go with a cloud, on-premises, or hybrid ERP. Cloud deployments lower infrastructure and maintenance costs but require ongoing subscription fees, while on-premises deployments often involve larger up-front spending and greater responsibility for updates and security. Hybrid models mix both, balancing flexibility with control.
Hidden costs can also emerge if you’re not careful: extended customization work, additional integration projects, data cleansing, and the productivity impact of user adoption all add to the total price tag. By anticipating these elements, you’ll be better positioned to budget realistically and avoid surprises.
Effective ERP implementation lays the groundwork for sustained performance and agility in a business world that’s constantly changing.
Effective ERP implementation lays the groundwork for sustained performance and agility in a business world constantly changing. The decisions made during planning, vendor selection, and rollout shape how well the system supports your business years down the road.
As you reflect on the journey, consider how your ERP can become more than an operational tool. With the right foundation, it can evolve into a strategic asset that drives smarter decisions and enables innovation as you grow.
The next step? Turn these insights into actual. Evaluate where you are today, identify gaps, and commit to building an approach to implementing an ERP system that delivers lasting business value.
The number 1 priority for SMBs globally is increasing technology investments—but why? Explore this SMB Group report for key insights on how unified finance and HR systems are helping streamline operations and drive growth.
More Reading
The CFO role is more dynamic than ever. Success comes from building a career that blends breadth and expertise while staying true to the unique strengths and skills you can offer.
Learn how AI is moving finance from reporting to strategy with this four-step playbook for implementation and growth
We believe Workday’s recognition as a Leader in two Gartner Magic Quadrant reports and the only Customers’ Choice for Cloud ERP for Service-Centric Enterprises validates its position as the next-generation, intelligent system of action that helps finance teams navigate talent shortages and business complexity.
