Argon & Co: Organisations must rethink operating models to unlock AI and ERP success
As enterprises across the Middle East accelerate AI and ERP transformation programmes to streamline operations, improve decision-making and support ambitious growth plans, many initiatives continue to fall short of expectations because they continue to rely on outdated operational structures, according to a new whitepaper from Argon & Co.
Although investment in core business systems and artificial intelligence is accelerating rapidly across the region, many organisations struggle to bridge the gap between strategy and execution. Technology itself is rarely the main obstacle. Instead, success depends on whether businesses are willing to redesign the way they operate alongside their technology investments.
“Technology can unlock transformation, but only the right operating model can sustain it,” said Stefan Westdijk, Managing Partner at Argon & Co.
Research cited in the whitepaper – the first in a series – illustrates the scale of the challenge. One study found that fewer than half of ERP (enterprise resource planning) programmes achieve or exceed their intended business outcomes. Another paints an even bleaker picture, suggesting that only around 30% of ERP transformations deliver sustainable change while meeting their target objectives.
These relatively low success rates are, to some extent, unsurprising. ERP programmes rank among the most complex forms of digital transformation, touching nearly every function across an organisation. They require extensive process redesign, organisational alignment and behavioural change in addition to technology implementation, making successful execution particularly challenging.
The AI landscape presents a different set of challenges. While investment levels continue to grow rapidly, many organisations are still navigating largely uncharted territory when it comes to deploying AI at scale and generating measurable business value.
Beyond the financial cost of unsuccessful programmes, the report highlights the often-overlooked opportunity costs. Failed or delayed ERP and AI initiatives not only waste substantial investment but also slow organisations’ ability to adopt technologies that are becoming increasingly essential for maintaining competitiveness.
Operating models must evolve
Argon & Co observes that one of the most common barriers to successful ERP and AI transformation is not the technology itself, but the operating model that supports it. Organisations that attempt to implement sophisticated digital platforms while maintaining traditional, siloed organisational structures often find that transformation becomes a one-off programme rather than a lasting organisational capability.
To close this gap, Argon & Co recommends fundamentally rethinking how work moves from concept to delivery. Rather than organising around functional departments, successful organisations are increasingly building cross-functional teams centred on specific business outcomes. This reduces unnecessary handovers, strengthens accountability and enables faster, more effective execution.
Overcoming capacity and speed constraints
The whitepaper also identifies overloaded project portfolios as a major challenge across the Middle East. Many organisations attempt to deliver too many transformation initiatives simultaneously, stretching internal expertise and leadership capacity too thin.
According to Argon & Co, the real constraint is often not funding but the availability of experienced leaders and specialist talent capable of driving complex programmes. When organisations fail to align project ambitions with realistic delivery capacity, progress becomes fragmented, with numerous initiatives launched but relatively few completed successfully.
Decision-making speed is another critical factor. While organisations across the region often benefit from strong executive sponsorship and robust governance structures, unclear decision rights can cause issues to circulate through multiple committees before action is taken. Argon & co highlights that faster decision-making has become a significant competitive advantage, helping organisations maintain momentum, reduce rework and accelerate value creation.
Retaining internal control
The report also cautions against becoming overly dependent on external technology vendors. While specialist implementation partners often play an essential role in large-scale transformation programmes, organisations risk losing strategic control if vendors begin driving product roadmaps and key business decisions.
Instead, the authors emphasise that organisations should retain ownership of products, priorities and outcomes internally. Doing so helps preserve accountability, strengthen internal capabilities and ensure critical organisational knowledge remains within the business long after implementation has been completed.
Leadership recommendations
To improve the likelihood of successful ERP and AI transformations, the authors outline three priorities for business leaders: establish clear ownership of business outcomes, define explicit decision-making pathways and organise delivery through cross-functional teams.
Beyond individual projects, however, Argon & Co believes that organisations should embed these principles into a broader portfolio operating model. Rather than treating each transformation as a standalone initiative, businesses should institutionalise consistent governance, decision-making and delivery practices across the organisation. Combined with continuous improvement, this enables digital transformation to become a repeatable organisational capability rather than a series of isolated programmes.
“ERP and AI transformation becomes sustainable when delivery is built into the organisation, not managed around it,” said Bouchra Ghrayyeb, Senior Consultant at Argon & Co.
Westdijk added: “The operating model is the lever that turns ambition into execution through faster decisions, clearer ownership, stronger adoption, and benefits that are realised early and sustained over time. The goal is not simply to run a better programme. It is to build a repeatable delivery capability that continues to improve long after go-live.”
To support leaders with aligning their operating model with the demands of ERP and AI transformation, Argon & Co developed the DELIVER Operating Model, a practical framework for delivery more repeatable, outcome-led and sustainable.
