Research conducted in recent years by Panorama Consulting Solutions has shown that the installation and implementation of enterprise resource planning software is often less than optimal for many organizations.
One of the most interesting results from surveys of companies that have set up ERP software is that, even with roadblocks, delays and cost overruns, few organizations characterized the process as a failure. In fact, only 10 percent of respondents characterized their venture with ERP as a failure in the 2013 iteration of Panorama's study, which was reported on by ZDNet. It appears that even when ERP implementation doesn't progress smoothly, most businesses are still satisfied with the results.
The question for organizations looking for greater internal insight into operational data and opportunities to improve efficiency, then, isn't whether or not to use these software platforms, but how to make sure the process goes smoothly. Here's some advice for businesses to improve their ERP setup:
1. Involve stakeholders from across the organization in the process
While the installation of the software itself is a technical process, the selection of a correct program and best practices for continuing use need to involve all the areas and departments impacted by the use of ERP. The IT department, work floor managers, accounting team and executives should have honest discussions about expectations and needs before a provider is even selected. By creating a clear, explicit list of what is required ahead of time, there will be fewer problems with changes made during and after the implementation and a greater range of concerns will be addressed.
2. Distinguish between costs and return on investment
ZDNet's report on the 2014 Panorama study makes the point that the cumulative advantages of ERP are realized over a long period of time. This is important to remember because the upfront costs of components like inventory control systems and time tracking software will be delivered all at once. Whether businesses are using the information generated by ERP to influence decision making or distinct pieces that aid in the automation and optimization of organizational processes, the total cost and time savings may not become apparent for a period of months or even a few years.
However, once an ROI is reached, ERP will continue to provide these benefits. This results in a long-term positive for companies using the software, but they need to be aware that the payback won't be immediate.
3. Consider a modular solution
Businesses with a wide variety of needs, especially those in the manufacturing, fabrication and warehousing fields, should consider using a modular solution like Microsoft Dynamics NAV. The customizable nature of these platforms means that businesses can choose which add-on components best suit their requirements without excessive spending on unnecessary programs. Making changes or additions after initial implementation is also much simpler with a modular program. Instead of having to upgrade an entire system, targeted additions can be made as a business grows and develops.