Today, most business organizations have begun replacing their systems with ERP initiatives tornimprove management and administration. As most business organization CBE, Ethio TelecomrnEthiopian Airlines and Heineken Ethiopia also planned a reengineering project that arerndesigned to introduce world class business processes including the implementation ofrnâ€œEnterprise Resource Planningâ€ system. This study focused on the investigation of successrnfactors, challenges and future prospects of ERP systems in business organizations in Ethiopia.rnThe research design was descriptive method and a five point Likert scale questionnaire are usedrnfor data collection and analyzed using descriptive statistics. Based on the results toprnmanagement support, project team competency, user training, interdepartmental communication,rnand consultant support are CSF of ERP implementation. Also challenges of implementing ERPrninvestigated are Lack of skills for implementing and using ERP, Insufficient training to users,rnIntegration of different types of data was a big problem, Incompatibility with work, High systemrncost, Long customization period, High user resistance, System led to major organizationalrnchanges and ERP system too complex were the challenges faced by the firms. Furthermore basedrnon the result various modules of ERP such as customer relationship management system, humanrnresource management, procurement management, plant maintenance scheduling, manufacturingrnmanagement, budget planning and projections and financial management components arernfunctional and feature prospects are Eliminate/Reduce redundant tasks, Easier access tornreliable data and information, Standardization of global business operations, Pressure to keeprnwith competitors, improved internal communication, Overall reduction of operational costs andrnimproved supply chain management