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An Expert Witness View of ERP Failure
Thursday, March 27, 2014

We are asked by many law firms to analyse failed ERP systems and provide an opinion as to why they have failed.

Typically organisations resort to other means to get some form of satisfaction when their ERP project ends in some form of miserable failure. Failure in this context can take many forms; massive cost overruns, lack of system performance against expectations, complaints about inexperienced integrators, misleading and fraudulent representation and so the list
goes on.

Our approach, as expert witnesses, is to look at the totality of the ERP project and the role of all of the interested parties. This includes the ERP software sales people, the system integrators and the implementing client company. The term used to describe the relationship between the parties is called “The Devils Triangle.” The ERP sales people create an expectation via their sales pitch, web sites and glossy brochures, the integrators who
attempt to implement the system to meet the expectations of the client and the client who struggles implement the system and come to terms with the changes required to ensure a successful outcome.

Within each of the players in the devils triangle there are a myriad of issues that need to be identified and assessed. Our role as expert witnesses is to sort through these issues and provide an opinion in an unbiased way as an aid to the court.
The areas we focus on in our analysis are:
What was required
What was offered, in writing and verbal
The reference sites
The contract for supply and services
The implementation project management and control
The company role in carrying out the work
The integrators roles in advising and assisting
The identification of critical project issues
The communication and escalation of critical project issues
The expertise of the integrators

There is no doubt each of the different parties share a degree responsibility for ERP failures, but a key question to be answered is “Who carries the greater burden for the failure?” Part of the problem in determining responsibility, each party can legitimately point to the other parties and show failure to perform. The arguable point is always “Who were the experts guiding and advising on the overall ERP process?” These are the ultimate points that
will be argued by the respective legal parties to try to apportion the blame and responsibility.

The reality is it is really in no one’s interest to engage in expensive legal battles unless it is absolutely necessary. Mediation should always take precedence over litigation to try to find amicable solutions.

Our expert witness analysis applied in a court of law always demonstrates the interaction of the parties in the devils triangle but also puts the spotlight on the “expert parties” who have the experience and expertise as key roles in ERP failure.

Experience Worth Listening to!

Ray Atkinson