ERP failure in developing countries: A case study in India

There is no denying the fact that industries of any dimension in a country have considerable contribution to the GDP of that country. If economic health of industries in a country become better, the financial health of the country, also becomes enriched. The economic health of the industries in India is also required to be improved so that India, as a whole, can prosper. Now, in order to achieve this, the industries in this developing country are required to properly automate their processes of business so that they can attain apex of their success. To achieve this, the industry should strive to switch over to Enterprise Resource Planning Systems (ERPs) from the age - old legacy systems. But unfortunately, it has been noticed that this adoption seems beset by significant rates of failure, leading to large wastage of investment and other different resources. In this paper a sincere endeavor is taken to realize why such failure occurs. To achieve this, in this paper, “design-reality gap” model is used which is comprehensive but sensitive to the specific conditions of the culture of the particular organization. This framework has been applied in an industry in India to ascertain the “gap” in different dimensions in situations both before and during ERP implementation. In the concluding part of this paper it has been noted that challenges which are existing in developing countries would continue to constrain the proper and fruitful use of ERP systems in developing countries unless some specific changes are brought in.