Are You Getting Your Money's Worth From Your ERP Investment?

A recent question from an ERP customer opened the door to a conversation around application utilization. Meaning: "We bought the license for the whole application, but we're only using a small portion of it. How can we get more return on our investment?" I brought this question to Amer Dalain, ERP Advisor.

SDM: As I understand it Amer, your focus is ERP Advisory Services?

AD: Yes. Consultants usually are engaged to look at a specific problem, so they fix it and leave. An advisory relationship is a long-term and strategic relationship. It includes fixing specific problems, but focuses on ensuring that the ERP system is continuously aligned with the customer's business objectives, and on achieving better performance by optimizing the ERP system.

SDM: What is the first question you ask an ERP customer about their investment?

AD: How are you maximizing the returns on your license investment? Businesses continue to change. This change brings new challenges and opportunities which translate to new system requirements. A lot of companies have already purchased the medicine that helps them ease these pains, but they are not using it. Many customers leave a lot on the table to get through the notoriously risky Phase 1 and GoLive.

SDM: In your experience, how much do they leave on the table?

AD: An interesting dynamic happens when a company goes live with a new ERP system. During the first week, the user community is generally quiet. Users are still not at ease with the system. They are finding their ways around process guides to do their jobs, and they are not exploring what is out there. Things get interesting the next few weeks. The extended user community starts to reach out to the ERP project team with questions like," Why can't we use this feature?" or, "We saw during initial demos that the system could do this and that, how come these useful features are not turned on?" Questions like this represent first glimpse into future phases of the ERP implementation project.

To answer your question, there is no specific percentage that companies leave in terms of functionality. Some companies leave out functionality on purpose -- so they keep the scope low for Phase 1. Some companies leave functionality out because they do not know that it exists.

The key point is that businesses are dynamic and they need to keep making sure that the software systems are aligned with the business objectives.

SDM: How do you approach helping customers maximize the return on their investment?
AD: The thinking process around the scope of an ERP implementation goes through three phases:

During sales, the client is shown a fully implemented system with all the bells and whistles (like Enterprise Portal, Enterprise Search, Workflows, BI and Dashboards, Quality Control, Mobile Apps, etc.).

During implementation, and to mitigate risks, the scope is usually limited to key functionality only. This may result in a situation where the new system has less productivity features, reports, and functionality than the existing systems.

Once the Go-Live phase is complete, users start discovering new features that were not implemented. These are usually productivity enhancement features that can be implemented quickly and with less risk than the initial phases of the implementation.