9 in 10 CFOs claim that implementing enterprise resource planning drains budgets and lacks ROI
Mid-sized organisations experiencing rapid growth are increasingly turning to ERP systems to manage their expansion, often earlier and faster than planned. When entry-level software fails to meet their financial needs, frustrated CFOs rush to adopt full-scale ERPs, overlooking mid-tier solutions specifically designed for organisations of their size.
According to AccountsIQ’s latest CFO mindset report, based on a survey of 1,000 senior finance professionals, 60% of organisations are using 50% or less of their ERP’s functionality, and only 2% are using all of it wasting budget.
Darren Cran, CEO of AccountsIQ, said, “For many mid-sized organisations, the decision to go all in on a heavy ERP is based on growth aspirations, but often results in a reduced return on investment, complexity, inefficiency and a drain on budgets.”
The research reveals why ERP regret has become so widespread. More than a third (36%) of CFOs cite inadequate training and support as their main frustration, while (31%) point to excessive unused functionality as the core issue. System outages and lengthy implementations also featured prominently among complaints, with 22% of finance leaders concluding their ERP simply isn’t worth the investment. Notably, only 6% reported being fully satisfied with their system, leaving many to wonder whether ERPs are actually worth the investment.
Cran continued, “The financial implications are alarming. The average ERP costs mid-sized organisations around £100,000 a year. If organisations are only using half the functionality, £50,000 is effectively wasted each year and this is happening to almost two-thirds of finance teams. This represents a major drain on budgets, reducing return on investment and tying up funds that could be better utilised elsewhere.
“Clearly, many finance leaders are overbuying functionality and underusing it. Simplicity and usability always beat endless features. Mid-sized organisations often feel trapped between starter software and enterprise-grade ERPs, but the most expensive option isn’t always the right one. Finance leaders need to resist the urge to over-invest and instead take the time to understand exactly what their finance team needs and then find a purpose-built finance management system that meets those needs.
“For finance teams stuck using starter software and looking to upgrade, ERPs don’t have to be the only viable option. For those already experiencing ERP regret, moving to mid-tier software isn’t a wasted investment, it’s a chance to scale more smoothly, remodel processes and avoid paying for functionality you will never use,” concluded Cran.