top-tenWe first posted the results of an interesting survey done by the accounting firm Deloitte about five years ago, but it’s time for a reprise.

In their study, conducted across a broad range of people who bought business management software systems a few years back, Deloitte undertook to see how experiences varied between inexperienced (first-time) and experienced (or ‘second-time’) buyers.

Asked to rank the importance of critical purchase factors, each group ranked their concerns as follows…

First- Time Buyers

  1. Price of the software
  2. Ease of implementation
  3. Ease of use
  4. Ability to fit business
  5. Functionality
  6. Ability to work with existing hardware
  7. Growth potential
  8. Level of support provided by reseller
  9. Quality of documentation
  10. Developer’s track record of performance

Now let’s look at what the more seasoned buyers had to say in their rankings:

Second- Time Buyers

  1. Level of support provided by reseller
  2. Developer’s track record of performance
  3. Ability to Fit Business
  4. Growth potential
  5. Price of Software
  6. Quality of documentation
  7. Functionality
  8. Ease of Use
  9. Ease of implementation
  10. Ability to work with existing software

As we noted back in 2012 when we first wrote about this:

We know.  We’re prejudiced.  But it’s also nice to know… we’re right.  It’s a lesson we preach every day.  No, not about being right… the part about how critical it is that your system provider be capable of providing experienced hands, a high level of support and deployment assistance.  That’s the real number one factor to consider.  But don’t take it from us – take it from the folks who matter: the customers who bought.


ERP Selection Tips

tipsERP blogger Eric Kimberling of Panorama Consulting recently posted some advice about selecting an ERP system, along with a few comments about specific systems, which we thought we’d share today (while adding a couple of our own).

We know that most clients think (or hope) an implementation can be accomplished in a few short months.  We usually try to let them down gently when we will tell them that a year or more is the norm – with large and comprehensive systems often taking considerably longer.

Kimberling, who owns an ERP consulting firm on Colorado, notes that his firm’s experience is indeed the same: about 18-24 months for the “average implementation.”  And that’s regardless of whether the system chosen was SAP, Infor, Oracle or Microsoft Dynamics.

Among those particular choices (SAP, Infor, Dynamics, Oracle, Dynamics), his firm’s experience showed that Microsoft Dynamics was the lowest cost on average to implement, but generally took longer too.

Some of Kimberling’s advice to shoppers includes:

  • Define and prioritize your highest priority business requirements to quickly arrive at a short-list
  • Leverage independent experts who can help you quickly narrow the field
  • Don’t forget to consider implementation while evaluating ERP systems (Don’t just focus on the software: understand how it will be implemented.)

And we would add one that’s maybe a bit of a surprise: the software is not what matters, at least not entirely.  There’s lots of good software: it’s the team you work with, and their understanding of how to apply the software to your business processes, that will yield the most superior results in the end.  We know it from years of experience.

He reminds us that 50-70% of all the implementations his firm sees experience significant operational disruption.  The industry average, he notes, has hovered just above 50% for many years.  So… expect some disruption.  Just emember, ERP is a strategic investment.  It takes time, and it’s not turn-key.  Work with your consultants and providers as a team – and we can assure you, you’ll get there.  Patience on both sides goes a long, long ways.

According to some statistics Kimberling shares at his website, payback tends to come in greatest at years 3 and 4 after purchase.  But we would add: after that, the ROI and savings are permanent.

Finally, Kimberling advises that you can quickly narrow the field down to the top ten or twenty percent by prioritizing those that meet two key requirements:

1) they are critical to your business, and

2) they are differentiating functions of various ERP systems in the market

Only those that meet both criteria should be used to narrow down your short-list.


tech-politicsWhile a bit off-topic from our usual biz-tech postings, today’s post is no less relevant in view of our nation’s recent political transition in Washington.  Our comments today are gleaned from a Wall Street Journal article by Personal Technology editor Geoffrey Fowler that asks the timely question: “Can Tech Make Democracy Better?”

Fowler points out the difficulty of what you’d think would be an easy task: Can you identify the roughly 30 public servants who represent you from the local to the national spectrum?  It’s harder than you’d think.  Fowler searched for online tools that might help.

One notable site is the Internet Archive’s searchable database of everything newly-elected President Trump has said on TV, assembled and hand-curated by humans and focused solely around Trump’s 800+TV appearances.  There will always be value in “checking the tape,” he notes, at a time when facts are often considered “up for debate.”

Open-data advocates including the Sunlight Foundation and Code for America have attracted thousands of volunteers who have put a lot of data online.  But while there are a lot of databases out there, what’s currently posted is just a fraction of everything the government is up to.  Fowler has found a few nonpartisan tech tools he says “could empower us to keep politicians honest,” and which we offer to our readers today as a public service.

There is no single source to find all your representatives, he notes.  Start at myreps.datamade.us, created by a civic data firm in Chicago.  You type in your address and find your representatives in the national and state capitals, as well as some city representatives.  Even there, only about 50,000 of all 519,000 elected American officials are listed.

A site called Govtrack.us lets you “follow specific legislators in Washington to see their voting records.”  The site also sends email alerts on bills your representatives may sponsor.

Votesmart.org links issues to details about what specific politicians have said and done.  Another site, Washingtonwatch.com helps convert pieces of national legislation into the cost or savings for the average family.

Yet another site, Brigade.com, is working to turn politics into a social network, and is currently oriented toward elections.

And then of course there’s Facebook and Twitter, where you can follow as many of your representatives as choose to post their views on pages there.

Taken together, you can consider these sites your Civic Feed.  In today’s new digital democracy, these new sites and portals provide citizens with some of the basic data we all need to stay informed, hear a candidate’s own words and views, and decide on candidates whose views most align with ours – not to mention, the truth.

metrics_mfgIn our prior post we talked about the metrics often applied in manufacturing to determine whether a company is best-in-class, or merely adequate, that companies use to identify and then improve their strategic performance.  We noted how manufacturing education associations like APICS and MESA have created metrics guidelines to help companies analyze their own strengths and weaknesses.  And then, because after all we’re all about ERP, we noted the difficulty in making the leap from identifying key metrics to actually implementing improved operations, controls and workflows through ERP.

Today then, a quick look at a couple examples drawn from the experiences of manufacturers, as identified by some consultants at a firm called Edgewater.

One company was a biotech firm headquartered in Kentucky with branches worldwide.  Possessed of an entrepreneurial spirit, the CEO was known as a “go, go, go” style of leader.  Their greatest challenge was to use technology in ways others had not.  They needed to bring global acquisitions into the family in quick and agile fashion.  They were a big user, as are many others, of Microsoft technology, from “the stack” through ERP (Dynamics).  They chose to employ a global infrastructure (via Azure) to minimize the investment within a specific country – where they’re opening several outlets per month – and crank up hundreds of servers quickly to speed the process.  Here, the platform goes hand in hand with ERP to ramp up quickly and cost-effectively on a common platform.

Another company was an Arkansas based poultry processor (of five millions chickens a week!) with challenges very specific to their business processes.  As their I.T. director notes: “In each of our independent processing locations we consider how they perform, accounts payable or accounts receivable, and ask each one: Is this a market differentiator for us? Is it something that sets us apart? Specific business process owners must justify keeping a process at an individual location; if they cannot, we eliminate those processes and standardize them across the organization.”

Here, it’s all about those ‘best-in-class’ competitive differentiators that a SCOR metric (noted in our prior post) helped them to identify and address.

But above all in these and other cases, it’s always about the results.  To do that, the CEOs had to be sold on the idea that a lot was going to be asked of their team.  As one I.T. director pointed out succinctly in speaking of his firm’s ERP project:

“In order to be successful, we had to make some assumptions about the level of effort required from non-IT people. Fortunately, our CEO bought into that completely and committed those resources, making it really clear to all the VPs that whatever we needed to do to make it successful was what we were going to do. I didn’t have to spend a single minute trying to convince anyone about what was required of them or what we needed from them. Having that full buy-in from senior leadership down made a huge difference.”

It’s a lesson well-learned and hard-won – one even we as implementers today must remind ourselves of from time to time.  ERP is hard.  As providers, our job is just as stated above: to convey to our clients how committed their team needs to be to owing the process.  It’s a lesson we never can learn well enough.

scorWith technology being everywhere today from the WiFi in the coffee shop to the Fit Band on our wrists, it’s not a stretch these days to say that today’s ERP and CRM systems are the equivalent in the business and manufacturing world: the band that ties the enterprise together through technology.  In a rapidly changing marketplace and supply chain, the input, feedback and data provided by these systems allows companies to keep up, or even get ahead, in the market.

The APICS Supply Chain Council has created a series of over 250 metrics known as SCOR (for Supply Chain Operations Reference) that helps manufacturers to measure these solutions.  These metrics are organized into a hierarchical structure starting with the organizational level, moving up to the process level and finally the diagnostic level.  They focus on: reliability, responsiveness, agility, costs and asset management efficiency.  Those first three attributes are mostly customer-focused, while the latter two are internally-focused.

The challenge then for any company is to analyze and define, then align and prioritize, the market and competitive requirements for each of these attributes.  Ideally then, a company wants to decide where it thinks it can be “best-in-class” and where it thinks it can at least adequately compete.

As a whitepaper by a firm called Edgewater points out, there is a second organization that goes by the name of MESA, the Manufacturing Enterprise Solutions Association that provides similar metrics.  In their Guidebook they point out the importance of the measurement process:

“Production companies are quite complex, so most need to work through the process of articulating goals and crafting a system of metrics that is effective. Each company may need to create its own correlations and linkages from corporate objectives to financial metrics to operations key performance indicators (KPIs) and from aggregate KPIs to very specific metrics at the individual, line or unit level.”

The point of all this as it relates to ERP is simple: It’s about a lot more than simply strapping on an enterprise fitness band, so to speak.  The managing of the people, the processes and the data, and getting the client company to embrace all these, is a bigger challenge than appears at first blush.

In our next post, we’ll take a look at a couple examples cited by Edgewater where firms had to throw out the old in order to bring in the new – as in, a new ERP system – and some of the challenges they faced.

Stay tuned…

erp-upgrade-pic_2Our prior post attempts to answer the question captioned in our title by suggesting the first three, commonly accepted steps in the process: Preparation; Process Review; Fit/Gap Analysis.  Today we’ll conclude with the last three steps.

Step Four: Architecture.  In this step, which may be a part of one of the next steps, you identify the hardware foundation for your solution.  It could be cloud based for certain well-defined verticals and for more generic (i.e., pure accounting) solutions, or it may consist of hardware, either on-premise or off, that will serve as the underlying architecture for your solution.  The hardware however is always a byproduct of – and dependent on — the desired software solution.  This step is the natural follow-on to any potential solution identified in the earlier fit/gap analysis.

If you’ve decided on standing pat or upgrading your current solution, you still need to ensure that the hardware it runs on is up to the task and offering you the speed, functionality and scalability you require today.  If you’re considering new technology, new or upgraded hardware will be a part of that overall consideration.

Step Five: Scope definition.  Just as it’s important to define what your choices will do, it’s important to define what they won’t – at least initially.  Here you determine the bounds of your new implementation.  This is the place to look at where you potentially will, and will not, modify the workings or code of the proposed new solution.  We often advise clients to work as much as possible with their new software “out-of-the-box” and to forego all but the most critical, business-necessary modifications until they’re up and running and have had time to truly understand the capabilities of their new system.

We find most companies are a bit overwhelmed initially with what their new system can do for them.  It’s almost too much to wrap your head around all at once.  So initially, take it one step at a time.  There’s plenty of time later to decide where you want to fine tune your system (assuming your selection can be fine-tuned and modified – some systems are better at this than others).

Finally as to scope, remember, this is where you can best identify and control costs.  A good, tight scope definition helps your software partner quote more accurately, and helps you ensure the budget is both realistic and achievable – in both dollars and time to implement.

Step Six: Proof of concept.  Once you’ve reviewed your processes, identified gaps and potential solutions, defined requirements, hardware, scope and acceptance criteria, you need some assurance that the proposed solution will work.  If you’re already familiar with a trusted adviser and software partner, they can step you through this process with either basic PoC demonstrations, or a combination of referrals, conversations and software high-level reviews.

This is not user training and does not involve porting over of existing data (aside from perhaps a few sample records for demo purposes).  It’s not a full prototype or a complete system test.  Proof of concept simply means a general acceptance that the overall processes you have identified as key to your flow can be accommodated in the proposed solution.  There may be some cost associated with this step, depending on the depth of your requirements for proof.  The key thing is to have established trust between your firm and your implementation partner for the long road ahead.


There are any number of variations on the steps and flow of your selection process, but the outline we’ve provided covers the fundamentals of an accepted method for determining your requirements, and whether your current solution will get you through, or a look at new technology is in order.

In all cases, keep an open mind… be honest and open about your expectations and your budget… and remember that ERP is, above all, a strategic investment in business improvement.  We may be biased after 30 years of doing it, but the relationship with your provider – and their business and technical capabilities and understanding of the business environment in which you operate – are the keys to success.  Remain honest and open with one another throughout the process, keep the expectations realistic and the lines of communication open, and you will ultimately be one of the success stories.



erp-upgrade-picIn this brief, two-part post, we’ll look at the commonly accepted process steps for answering the question in our title.  While there are many formats and variations on this process, there are essentially about six key steps a company can take to gain clarity on whether to upgrade, purchase new, or stand pat.

The first step is preparation: This is the information gathering phase where you define the internal skills and staff required to staff the process.  You’re doing this, presumably, because you question the utility or capabilities or robustness of whatever system you’re using today.  So you’re about to engage, possibly, in some real transformation.  Therefore, you want to look for a few thought leaders in the company who can help you map out what you’ll need in the future – and whether that will come from what you have, or require something new.

Here you want to identify the purpose of your assessment, and try to gather your subject matter experts.  How well can you identify and map your current business processes, in each department?  Do the participants have some ideas about what the future processes might look like?  Once you have an internal team established, and you’ve asked some of these questions, then consider bringing in the external subject matter experts.  These are typically folks who do this kind of thing for a living.  Fellow business people (owners, managers and grizzled veterans) are good referral sources.

Be sure you investigate and document your KPIs (key performance indicators) – those few key business benchmarks that you rely upon to determine the overall health of your business.  Try to begin to map your business processes at least at a high level, to share with the consultant you later engage.

Step two: Review your processes and requirements.  You want to identify, at least at a high level, the key requirements you require of a business management system, regardless of whether you’re inclined to keep or replace.  The business process review will largely define the scope of your ERP requirements, and serves as a tool in your selection process.

(At our firm, we use the term Business Process Analysis, or BPA, to describe a process for identifying workflows, mapping processes, identifying key technology touch-points, mapping current and possible future process flows, and ultimately creating a written Summary of Recommendations that serves as the “roadmap” for most of what comes after.)

Step Three: Perform a fit/gap analysis.  Just like it sounds, in this step you identify the gaps in your current methods or system between your business requirements and what you have today.  Reporting is often one key area.  Often, entire swaths of the business are untouched by the current system if the required technology simply wasn’t available when the system was implemented.  We often find this in the manufacturing/shop floor and warehousing/distribution realm.  Technology exists today that was uncommon ten or twenty years ago that allows companies to better manage product configuration, production and movement within the plant.  These technologies open up vast areas for process improvements and cost reductions across the board – and they simply didn’t exist (at least in economical form) a decade or two ago.  The fit/gap analysis is intended to identify all these shortcomings, and offer suggestions (including possible software selections) for how to fill them.

In our concluding (next) post, we’ll take a look at the final three steps.  Stay tuned…