Dive Brief:
- McCormick is trying to sidestep some of the difficulties that accompany major technology overhauls amid an ongoing ERP upgrade, executives said during the food company’s Q2 2025 earnings call in June.
- CEO, President and Chairman Brendan Foley told investors that the company has pivoted its ERP implementation plan to “derisk” the process by moving away from a “big bang” to a functional deployment approach. The shift will add time to the rollout, but smooths out investment periods, he said.
- “You should not see a peak of investments regarding the ERP implementation going into next year,” Foley said. “We’ll continue to invest in digital, in AI and things like that, but specifically for the ERP, you should not see an increase in spend.”
Dive Insight:
ERP implementations are an IT headache due to the complexity, the time it takes to complete and the difficulty of getting user buy-in. McCormick and many other companies are taking the plunge as migration deadlines loom and after years of relying on legacy systems.
Hershey, Mondelēz International and Lamb Weston have all worked on ERP overhauls in recent months. Outside the food aisles, household brands such as Clorox and retailers including Ulta Beauty have embarked on similar upgrade missions.
ERP upgrades often bring some type of disruption, whether it’s inflated technology spending or visibility gaps as new systems are turned on and old systems are sunset.
In its 2023 annual report, McCormick said its ERP focus will concentrate on U.S. operations through 2027. McCormick expected associated operating expenses of $35 million to $50 million annually throughout the period. The food manufacturing giant acknowledged the ongoing work but did not give an ERP update in its 2024 report.
As the company has continued its focus on tech, including AI, it has brought in a new executive to helm the efforts. Chief Information and Digital Officer Guy Peri joined the company in November after holding various leadership positions at Procter & Gamble.
“Guy joins McCormick with almost 30 years of experience leading digital strategy in service to consumers, customers and employees,” the company said in a LinkedIn post. “His expertise encompasses application of data, AI, cloud, information security, and enterprise transformation programs to drive outcomes and transform businesses.”
