Who's to Blame For Failed ERP Project that Prompted SAP Lawsuit?

It's a safe bet that executives of WasteManagement rejected from other companies two
Management, the company suing SAP for $100 millionyears earlier. Indeed, the development project that
over a failed ERP implementation, hadn't read theSAP proposed would drastically lengthen the
MIT Sloan Management Review article written byimplementation timetable from the original December
Cynthia Rettig in which she describes ERP systems2007 end-date to an end-date sometime in 2010
as "massive programs, with millions of lines of code,without any assurance of success."
thousands of installation options and countlessAs with most any failed relationship, however, it
interrelated pieces."sounds as if the "wronged" party may also need to
In an article, which I wrote about back in August,take some responsibility. According to a blog, Waste
Rettig point outs that a typical ERP implementationManagement may have had unrealistic expectations
"introduce(s) so many complex, difficult technical andthat the software could fix all of its problems, which
business issues that just making it to the finish lineincluded a wholesale firing of its management team
with one's shirt on (is) considered a win."and appointment of new executives following a
If they had, would they have bought SAP's allegedfinancial scandal.
pitch that the system it sold to Waste ManagementWaste Management "had a lot on its plate at once,"
was "an 'out-of-the-box' solution that would meetwrites blogger Demir Barlas. Certainly, taking on an
Waste Management's needs without anyERP implementation while in the midst of such a
customization or enhancements," one that could bemajor transition seems unwise. A bit of perfunctory
fully implemented throughout the company inside ofresearch should have clued Waste Management to
18 months? Highly doubtful.ERP's reputation for complexity.
According to a statement cited in an article, WasteBarlas also questions - and rightfully so - Waste
Management claims SAP deceived it by creating "fakeManagement's vendor evaluation process and ongoing
software environments" for product demonstrations.management of the SAP relationship. Barlas writes:
The project went bad almost immediately after a"More pertinently, how could these facts about the
sales agreement was signed in October of 2005.software be "unknown" to management? ERP
Though SAP promised a pilot version of the systemimplementations can take years, and are
would be up and running by Dec. 15, 2006, "it is notaccompanied by rigorous testing and planning. If
even close to being completed today."SAP's software is indeed a "complete failure," Waste
The increasingly acrimonious relations between theManagement's executives might well have been
two companies included an SAP "Solutions Review"asleep at the wheel; no one should pay $100 million
that found the software did not meet Wasteand wait two years to find out they've bought a
Management's needs and a failed effort atdefective product."
consensual mediation. Waste Management contendsThe bigger issue here is that traditional ERP systems
that it rejected SAP's suggestion that it would havefor many organizations appear to be more trouble
to "start over" with an updated version of the SAPthan they are worth. That is why well-known IT
platform if it ever hoped to implement the softwarecynic Nicholas Carr suggested - in a post that I
throughout the company. According to its statement,referenced and linked to in August - that Workday
which is cited in ITWorld.com:and other ERP systems delivered via a
"SAP's 2007 proposal is precisely the kind of risky,software-as-a-service model may be the "end of ERP
expensive and time-consuming project that Wasteas we know it.