We’re continuing our recap of Panorama Consulting’s annual (2014) ERP Report, highlighting key findings of interest to anyone considering ERP. Our first post was here, and you’ll find access to Panorama’s full report here.
We come now to the topic of Consultants. Of Panorama’s 192 surveyed firms, 83% utilized consultants. (We suspect the reason it wasn’t 100% is that perhaps the largest firms have the resources to hire their own and deploy them extensively throughout their deployment cycle.)
Consultants served key roles in implementation, training, change management, software selection and a half dozen other areas.
Reasons most cited for why organizations used ERP consultants were…
- To supplement internal resources with specific external skills
- To manage the implementation
- To be a strategic partner from planning through implementation
- To conduct an unbiased software selection
- To provide organizational change management support
As to project costs… the survey shows that 9% were under budget, 37% were on-budget, and the rest were over budget. Among those who were over budget, about 60% were “over” by 25% or less; the rest were “over” by more than 25%.
Regarding project durations… 25% were on schedule, 36% were over by 25% or less, and most of the rest were late by more than 25%. 2% were actually completed ahead of schedule.
As to benefits realized… the results were disappointing. While 80% realized measurable business benefits, two-thirds of them realized less than half the expected benefits. Only about one in four realized 51% to 100% of anticipated benefits. The top 7 benefits realized were (in descending order):
- Availability of information
- Improved productivity and efficiency
- Increased interaction across the enterprise
- Less duplication of effort
- Improved data reliability
- Better informed decision making
- Improved interaction with customers
Finally we come to timeline to recoup costs… which showed that fully half of respondents either don’t know or haven’t yet recouped costs (recall that many were not yet fully implemented, so this makes sense.) Of the rest, over half said they recouped their costs in two years or less; the rest took 3 to 5 years.
Finally, no surprise here… about one-half of respondents experienced “operational disruption.” The larger surprise may have been the other half, who stated they did not. Based on our own years of experience, we’re still scratching our heads over that one.
In our next and final post in this series we’ll offer a few of our own opinions regarding why we think, based on our own experience over two decades, that the results came out as they did. Stay tuned one more time…