The Revlon SAP Disaster: Lessons in ERP Implementation Failure

Revlon SAP Disaster

THE OBSERVATION

Revlon attempted to roll out SAP across its North American business. The implementation failed so severely that the company could not fulfill $64 million in product shipments. Stock prices dropped nearly 7 percent in 24 hours. Investors launched a class-action lawsuit.

THE ANALYSIS

This was not a software bug. It was a failure of executive preparation. The company ignored the fundamental requirement to understand its own business processes before attempting a massive integration. They had just acquired Elizabeth Arden and were struggling to merge operations.

Forcing a new enterprise resource planning system onto a broken foundation guarantees operational collapse. Excessive system customization and a complete lack of business process reengineering are the primary killers of these projects.

THE CHECKLIST

1. Validate readiness before launch. Never deploy software onto fragmented operations.

2. Appoint a named human owner for the transition.

3. Implement an incremental rollout. Big bang deployments multiply your risk profile.

QUESTION FOR THE NETWORK:

Are you preparing your business processes before integrating new enterprise software, or are you just hoping the technology fixes broken operations?

#EnterpriseSoftware #RiskManagement #OperationalExcellence #SAP #SupplyChain

REFERENCES: Henrico Dolfing: Case Study 6: How Revlon Got Sued by Its Own Shareholders Because of a Failed Sap Implementation. Analysis of ERP Critical Failure Factors: A Case Study in an Indonesian Mining Company.

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