December Blog Series: Spreading the Joy
Insights from: Cindy Jutras (Founder of Mint Jutras LLC)
While not every one of us across the globe celebrates Christmas, it is no doubt known throughout the world as a "giving" time of year. With 2015 just around the corner, let's see what kind of gifts enterprises may have received from their ERP implementations over the past year. Some will be good, some not so much. Maybe a new ERP is on your Christmas wish list?
Let's hope your ERP hasn't left the equivalent of a man's tie under the corporate tree this year. You see, ties really serve no functional purpose at all. They can be window dressing or the finishing touch to a nice suit. Or they can be a sad attempt to add class to an otherwise shabby outfit. Not only do ties not perform any particular function, they are constricting. Most wearers of ties will loosen them or shed them altogether at the first opportunity. If at the end of the year your ERP feels more like a noose around your neck than something useful, if it doesn't seem like it adds real value, maybe it is time to turn it in for a new business accessory.
Now here is a gift that many welcome any time of the year. Of course if you are under the age of 12, the sole purpose of these gadgets might be entertainment and maybe a little educational value. But most adults today use these electronic devices to access data and connect with the world in ways most of us couldn't even imagine just a few short years ago. Has your ERP delivered on its end of the gadget bargain? Can you use those treasured mobile devices to connect back to enterprise data contained in your ERP?
As a fun-loving kid you hated getting something as useful and necessary as clothes. As a teenager you dreaded receiving the (not cool) clothes your parents picked out for you. Don't worry; ERP doesn't try to keep you warm or put clothes on your back. But ERP itself can be a lot like clothes, particularly those you receive as gifts. Those you receive as gifts are equally likely to be either too big or too small rather than fit perfectly. If too small, clothes don't cover you well. If too big, they swim on you, while you trip over them while trying hard to fill them up. An ERP should fit your needs perfectly – not too big and not too small. Of course the ERPthat fits perfectly might also be the one with a little spandex in it, that provides a good fit, with the elasticity to grow.
Coal in Your Stocking
Nobody wants to wake up to a lump of coal in his or her stocking on Christmas morning. Coal is a pretty good signal you haven't been "good" all year. So what is the ERP equivalent of messy coal in your stocking? I would lump invasive customizations into the same category as coal. And unfortunately, customizations are the gift that keeps on giving. By building invasive customizations you are building barriers to consuming the innovation your maintenance dollars are paying for. Did you customize because your ERP is a poor fit? Perhaps it is an older solution, bought before ERP solutions really came of age. Or maybe you customized because you think you are different? Unless that difference is a real differentiator for your business, chances are customizations cost you more than the value you receive from them. Maybe a new ERP would fix that.
On the other hand, everyone can use a little extra cash. Can your ERP put money in your pocket? The 2014 Mint Jutras ERP Solution Study found the average ERP solution paid for itself in about 2.35 years. But of course, the savings doesn't have to stop once 100% ROI has been achieved and we find those with World Class ERP implementations produce some pretty spectacular results.
Regardless of what you include in operating costs and administrative costs, take a look at what you are spending and do the math. Even if you are not operating a World Class ERP (World Class is based on results measured, progress against goals and current performance), 5% to 6% is still a good chunk of change. Then add in inventory savings. Think what you could do with the money saved from a World Class implementation. If your ERP is preventing you from achieving these kinds of savings, perhaps you need to make an investment in order to reap those kinds of rewards.
2014: It's a Wrap!
As we wrap up 2014, take a close look at what kind of benefits you are reaping from your current ERP implementation. Are you keeping up with the competition? Are you realizing real cost savings? Do you have the kind of real time accessibility all those electronic gadgets should be bringing you? Or is it time to add a new ERP to your wish list for 2015?