By Steve Hammett, Account Executive, BroadPoint Technologies
One of the most critical decisions a growing company can make is the introduction of new technology into its business. There are so many things to think about when considering an ERP implementation that it can be overwhelming. Over my many years of seeing successes and (unfortunately) a few failures of ERP implementations, I have an approach that leads to a more successful outcome.
Technology is the engine that drives corporate productivity. Sound business process to implement that technology is the transmission. Effective, well-thought-out strategy is the gear shift. Well-connected and synchronized, they make a smooth running machine. Without all three, a car can only roll downhill. Similarly, technology implementations without intelligent strategy and sound business process will just go downhill.
Price-driven, fire-aim-ready technology deployments are proven to fail. Company decision makers unable or unwilling to commit to do the job right are asking for trouble-and that’s what they typically get, along with very costly fixes. Reasons abound, but most often it boils down to the basics: budgetary mandate to go as cheap as possible and to implement in an impossibly-short time period. While cost and time efficiency certainly factor into the final equation, they should be guidelines, not primary decision-making drivers.
Before making determinations about either, commit to researching what’s needed in scope, time, and money. Then, and only then, establish a timeline and budget for the process. Instead, what often happens is a dramatic call for sweeping improvement. Technology is thrown at the problem as a quick-fix. Companies substitute the technology itself for sound business process.
Quick-fix thinking isn’t anything new. From the time the innovative General Hannibal implemented new technology (elephants) to enhance his ability to wage war, management theorists have recommended wave after wave of performance improvement and technology strategies to gain the competitive edge. Noble intentions drive these efforts, and each may address a part of the problem. If the goal is to symbolize to employees, customers, and shareholders that management recognizes the challenge and is doing something about it, then any of these campaigns will do the job. However, piecemeal approaches purported to be the answers to technology issues can be as dangerous as no response at all, as they can absorb resources and detract from the true needs.
This is confusing; so what does a person need to think about to get started? A few years ago Deloitte and Touch surveyed hundreds of companies who had recently purchased a new ERP system; what was unique about this survey is that D&T separated out the respondents’ criteria into first time and second time purchasers to determine if experience changed purchasing criteria.
| Top Ten Criteria for Selecting Software | 2nd Time | 1st Time |
| Level of support from the solution provider | 1 | 8 |
| Vendor’s track record of performance | 2 | 10 |
| Software’s ability to fit the business | 3 | 4 |
| Growth potential of software | 4 | 7 |
| Price of the software | 5 | 1 |
| Quality of documentation | 6 | 9 |
| Functionality of the software | 7 | 5 |
| Ease of use | 8 | 3 |
| Ease of implementation of the new system | 9 | 2 |
| Software works with existing hardware | 10 | 6 |
If you look at the second time column, (experienced purchasers), solution provider support and vendor’s track record were the top criteria while the first time purchasers had these at the bottom. This clearly demonstrates that experienced decision makers value the partners expertise above all else while the inexperienced decision makers don’t understand how critical the partner is to the implementation. Additionally, inexperienced purchasers put price as their top criteria yet experienced purchasers put price out of the top three criteria. So, look for partners that have experience, understand business process and have a large stable of clients who see them as trusted advisors. I would add software viability to this mix; make certain that the software you choose is backed by a financially sound company with a proven track record.
This last criterion is the reason BroadPoint is a Microsoft Dynamics partner. For mid-sized businesses, you want to be certain that you have a firm foundation in which to grow your business, and Microsoft provides this foundation. As your business evolves and grows, we partner with you to tune the engine that drives corporate productivity. BroadPoint and you, with a Dynamics foundation, make a smooth running machine.
So when beginning a search for a new ERP system, look for a partner who understands your business, uses sound software and has clients who see the partner as a trusted advisor.
by BroadPoint Technologies - Virginia Microsoft Dynamics GP Partner
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Very insightful! Though ALL of the critiria mentioned in your chart should be considered and weighed, I agree that the partner that the customer chooses to team with can make or break the implementation!
Everyone looking for a new/replacement ERP system should rate their priorities ~ and then step back and survey the field again!
[...] an ERP System The ERP Software Blog has a new post up on ERP sytem selection. The most interesting part is the reproduced Deloitte & Touch table showing top 10 selection [...]
[...] an interesting article by Steve Hammett on ERP Software Blog, where he shares his experience and helps to guide companies in the erp selection/implementation [...]
[...] Here is the link to the full article if you are interested in reading further: http://www.erpsoftwareblog.com/2009/06/choosing-an-erp-system-so-many-things-to-think-about/ [...]
[...] is the link to the full article if you are interested in reading [...]
Great article, giving lots to think about. When conducing your research for what’s required in scope, time, and money, consider hosting your applications to save initial roll out costs.
Check out the Software Plus Service (S+S) Hosted Microsoft Dynamics S+S License model.
- Includes required Microsoft stack of licenses
- Can either SPLA (rent) or provide customer owned licenses (managed)
- 20GB of SQL Server Data Storage (additional storage is available in (1) GB increments billed monthly based on actual usage)
- Includes monitoring of the hosted environment
- One daily back-up of SQL Data
- Tier 3 Telco Hosting Facilities
- 99.99% Dual Homed Internet Availability
- Access to GoIWx Customer Care for technical support
For more information or questions, let me know!
One mouse click often leads to another fine blog. Like yours – Thanks.
I’ve seen this study cited many places, but have been unable to locate the original source. Do you have any ideas?
[...] is the link to the full article if you are interested in reading [...]
[...] well choose the cheaper option. But I think the Deloitte and Touch report mentioned in this post (Choosing an ERP System – So Many Things to Think About!) is extremely telling. It compares the top 10 buying criteria of companies the first time they [...]
I’ve rss feed so I could check out further posts from you. Looking forward to more posts on the same subject. Thanks for the interesting blog!
Thanks Steve,
A much more firm foundation would be to own the software (ie. Free Software – Free as in Freedom), not to rent it from a proprietary vendor – as all of those limitations come into effect.
If you don’t, you’re renting it (proprietary software license). You can address any item on the list simply by changing your own software or switching vendor and keeping the software.
100% Custom, no license fee, unlimited user, wherever-you-want, non-proprietary software that you really own is software you can invest in and grow. Add any feature, any time. No limits – and in our case, about 50% lower cost than the competition!
Lloyd