Disadvantages of enterprise resource planning, Operation Management

Disadvantages of ERP Systems

1. Expense and Time in Implementation: Getting the full benefits of WRP takes time and money: Although ERP offers many strategic advantages by streamlining a company TPS large firms typically need three to five years and spend tens of millions of dollars to implement a successful ERP systems.

2. Difficulty Implementing Changes: In some cases a company has to radically change how it operates to conform to the ERP work processes its best practices. These changes can be so drastic to long time employees that they retire or quit rather than go through the change. This exodus can leave a firm short of experienced workers. Sometimes the best practices simply are not appropriate for the firm and cause great work disruptions.

3. Difficulty Integrating with other Systems: Most companies have other system that must be integrated with the ERP systems. Such as financial analysis programme e commerce operations. And other applications many companies have experienced difficulties making these other systems operate with their ERP systems.
Other companies need additional software to create these links.

4. Risks in Using One Vendor: The high cost to switch to another ERP system makes it extremely unlikely that a firm will do so. After a company has adopted WRP system the vendor has less incentive to listen and respond to customer concerns. The high cot to switch also increases risk in the event the WRP vendor allows its product to becomes outdated or goes out of business. Selecting an ERP system involves not only choosing the best software product but also the right long term business partner.

5. Risk of Implementation Failure: Implementing an ERP system is extremely challenging and requires tremendous amounts of resources the best IS and business people and plenty of management support. Unfortunately installations occasionally fail and problems with an ERP implementation can require expensive solutions.

Posted Date: 3/2/2013 2:54:22 AM | Location : United States

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