The troubled ERP rollout at Tennant echoes a familiar story in corporate America: ambitious digital transformation colliding with operational complexity. For Minnesotans, it inevitably invites comparison with 3M’s well-publicized ERP difficulties years ago. While the scale and stakes differ, both cases illustrate how even sophisticated companies can stumble when modernizing core systems.

Scope and Scale

The most obvious difference is size. Tennant is a $1.2 billion manufacturer of floor-cleaning equipment; 3M is a global industrial conglomerate with tens of billions in annual revenue. When 3M undertook its ERP transformation, it involved a far more sprawling product portfolio, global supply chain, and decentralized business units.

Tennant’s ERP project cost $98 million — significant for a company of its size. By contrast, 3M’s enterprise-wide SAP implementation spanned years, cost hundreds of millions, and affected dozens of business lines across continents. The magnitude of disruption at 3M was therefore systemically larger, though Tennant’s impact is proportionally severe relative to its scale.

Nature of the Problems

In Tennant’s case, the issues were operational and immediate. After successfully rolling out the system in Asia, the company encountered major disruptions when deploying in North America. Problems included:

• Difficulty fulfilling customer orders

• Inaccurate shipment dates

• Manufacturing bottlenecks

• Manual workarounds

The ERP implementation led to a $30 million fourth-quarter sales hit and a $22 million impact on adjusted earnings. Shares fell sharply — the largest one-day drop in 15 years — reflecting investor concern about execution risk.

3M’s ERP struggles similarly revolved around supply chain disruptions. During its SAP rollout, the company experienced:

• Shipping delays

• Order processing errors

• Inventory management issues

• Customer service challenges

In both cases, the core issue was not that ERP systems “don’t work,” but that enterprise-wide integration introduces risk at the most sensitive nerve centers of the business: order management, production planning, and logistics. When those systems falter, revenue feels the impact almost immediately.

Complexity as the Common Denominator

Both companies cited complexity as a key factor. Tennant CEO Dave Huml noted that “the complexity and scale of the North American business created unique challenges.” That explanation mirrors what many firms — including 3M — have said during ERP missteps.

North America, in Tennant’s case, likely involves more SKUs, larger customer volumes, more customized orders, and tighter delivery expectations than its Asian operations. Similarly, 3M’s broad and diversified product portfolio made standardization across divisions extraordinarily difficult.

ERP systems promise efficiency by harmonizing processes. But organizations often underestimate how deeply embedded local variations and legacy workflows are. When a standardized system replaces those processes, friction emerges — sometimes in unexpected ways.

Financial and Market Impact

The financial consequences at Tennant were swift and visible:

• Quarterly net loss of $4.4 million (versus $6.6 million profit the year prior)

• Sales down 11.3% in the quarter

• Stock down roughly 25% after earnings

For 3M, the financial effects were also material but cushioned by its scale. Disruptions contributed to missed revenue targets and margin pressure, but the diversified nature of 3M’s business mitigated the existential risk. Tennant, by contrast, absorbed a much sharper proportional shock.

One notable difference is investor reaction. Tennant’s stock plunge reflects the market’s sensitivity to execution risk in mid-cap manufacturing firms. 3M, while criticized during its ERP turbulence, had broader earnings streams and stronger balance sheet capacity to weather the disruption.

Response Strategy

Tennant’s leadership moved quickly into “hypercare” mode — a term common in ERP deployments, describing intensive stabilization efforts post-launch. The company is:

• Spending more than $20 million in Q1 versus the originally budgeted $5 million

• Pausing rollout in Europe, Middle East, and Africa

• Focusing resources on stabilizing North America

This reflects a lesson learned across industries: do not compound a flawed rollout by pushing ahead geographically.

3M similarly slowed aspects of its transformation to address system stabilization and supply chain recalibration. In both cases, leadership publicly reaffirmed long-term confidence in the ERP system while acknowledging short-term pain.

Long-Term Outlook

A critical point of similarity: neither company views ERP transformation as optional. Despite disruption, Tennant’s CEO emphasized expected long-term efficiencies. 3M ultimately stabilized its ERP environment and continues operating on modernized systems today.

ERP implementations are rarely about whether disruption will occur, but how severe and prolonged it becomes. Companies that successfully recover tend to share three traits:

1. Strong liquidity to absorb short-term financial hits

2. Transparent communication with investors and customers

3. Willingness to pause expansion and prioritize stabilization

Tennant appears to be following that playbook.

Key Differences in Risk Profile

Where the two cases diverge most meaningfully is structural risk. 3M’s diversification insulated it from catastrophic downside. Tennant’s narrower product focus and smaller revenue base amplify operational shocks.

However, Tennant’s more contained scale may also make recovery faster. Fewer business units and less global complexity can mean quicker system tuning once core issues are identified.

Conclusion

The Tennant ERP rollout bears strong resemblance to 3M’s earlier struggles: ambitious modernization, underestimated complexity, supply chain disruption, and investor backlash. Both underscore a broader truth in corporate technology transformations: ERP systems are as much organizational change projects as they are software installations.

The key question is not whether Tennant stumbled — it clearly did — but whether it can stabilize quickly enough to preserve customer trust and restore earnings momentum. If history from 3M offers any reassurance, it is this: painful ERP rollouts can be recovered from — but only with disciplined execution, strong governance, and patience.

In the end, ERP failures rarely stem from technology alone. They reflect the difficulty of rewiring the operating system of an entire enterprise — a task that is always riskier than it appears on the PowerPoint slide.