In this 7-part series we will present ideas and solutions to help build a business case for a new ERP in just 7 steps. In this second step we will take a look at some of the Investment Benefit Assessment challenges to getting support for your ERP project.
Step 2: ERP Investment Benefit Assessment
Here in the second installment of our ‘Making a Business Case for a New ERP’ series we are going to take a look at the Investment Benefit Assessment. When it comes to replacing and obsolete or homegrown system with a modern ERP manufacturers need to be aware of and address the new tools available to meet their business challenges.
These new tools will help meet business challenges head on while reducing costs to achieve a wide range of benefits. Some of these benefits include: Business Growth, Improved Efficiency, Information Integration, Process Automation, Business Intelligence and Better All-Around Collaboration.
When moving to a comprehensive, integrated ERP business gain needed functionality to manage larger more complex operations. Choosing the right system is paramount, it will enable a company to use an ERP to increase business and evolve. Using an ERP to grow your business is one of the most important (and if you make the wrong choice possibly company ending) decisions, so choose wisely.
When choosing an ERP there are many factors that go into the project: are you starting from scratch with a new project? Are you implementing the ERP in one site or across several locations? How many users will you have and will they all be local or will you have remote users as well? By having the right answers to these questions you can manage the implementation from the beginning and minimize any additional cost.
One big investment advantage to implementing a new ERP is the ability to improve efficiency across the board. This investment benefit can usually be seen in the first year by reducing inventory costs. Other areas benefiting from ERP efficiencies are eliminating redundant data entry, automation of workflows providing collaboration across functional silos, and to distribute improved business intelligence to inform effective decision making.
A new ERP will help eliminate inefficiencies and waste within your business processes and execution. In many cases a new ERP is able to pay for itself quickly, in some cases before the bill even comes due. Using the ERP to be more responsive in your production process and you gain the ability to predict any issues that may arise. This will let you cut down on production costs, raise productivity and provide savings for the lifespan of your ERP.
When it comes to choosing a new ERP solution, make sure to do your research. Finding the right system for your product, business or process requires a fair bit of research and testing. Making a hasty decision based on the name of the company can end up cost you more in the long run. By taking the time to make sure your process can be optimized with increased efficiencies you will be able to see savings in how you handle inventory, process and user costs.
An ERP is a huge purchase, it can go one of two ways; one, it can make you a more optimized and efficient organization resulting in cost savings and more generated revenue because of increased productivity. The other, it can be a nightmare with a long drawn out implementation that costs you money and interrupts processes bringing your production to a halt. Choose wisely.
Make sure to check back next week for Step 3: ERP Cost Assessment.
And if you missed Step 1 you find it… HERE.
Step 4: Implementation Risk Assessment
Step 5: The Implementation Approach
Step 6: Return on Investment Measurements
Step 7: Recommend the Preferred Solution