This white paper reflects the experience and counsel of a long-time provider of ERP / MRP software systems. Unlike many of our ERP-related blog posts, which are often based in comments first proffered by others, this one comes straight from us. The experiences, opinions and comments offered are strictly our own. They are based on 25 years of experience evolving through the many wrong ways, and finally the few right ways, which we’ve found over time will result in a successful ERP implementation.
Anyone who has spent much time providing business software systems has heard the question above – probably many times. When we tell prospective clients that a lot of work needs to be done before we can even begin to give them an honest and realistic appraisal of the cost to automate their business, some turn incredulous, if not indignant. “Why should I pay you to give me a quote?” is the common response. They think they’re being asked to “pay for a quote.”
Read on to learn what experience has taught us about the real answer to the question.
If you want a software quote, that’s easy – up to a point. Really good software for a small to midsize business will typically will run you about three or four thousand dollars per user when all is said and done. This will typically include accounting, inventory control, front/back office functionality (AP, AR, PO, SO) as well as some manufacturing functionality like bills of material, routes, and so on. That may drift up or down a bit depending on number of users, desired functionality and so on, but it’s a good ballpark figure. (It’s worth noting here that our specialty is working with distributors and, particularly, manufacturers whose needs often tend to be pretty complex.)
On top of the base software, there will be services. That’s the big one. We can quote you a rate per hour, based on a published rate table (the larger block of hours you purchase, the lower the rate). But no, we can’t tell you how many hours it will take, because neither you nor we have a clue how long it will take! We don’t know what works at your company and what doesn’t. We don’t yet know what you want to automate. We don’t know how smart your people are, or how complex your processes, or how committed your management team is… and we certainly don’t know how all those pieces work, or fit together (or don’t), or how you want it all to look in the end.
So in order to provide clients with a meaningful estimate of services, we have to do some work. A lot of work, actually. Put another way: We cannot quote what we do not know. So how do we get to the point where we can actually tell a client what’s involved in implementing their ERP system? The short answer is something we’ve come to call the Business Process Analysis.
But since a BPA is a billable engagement, it’s right around this point where a small but vocal percentage of prospects hit us with the question: “Why should I pay you to give me a quote?”
We’ll look at Where To Begin in our next post. Stay tuned…