Better the devil you know; building a case for ERP

Who knew that Kylie Minogue had such insight into the subject of business management software?

It’s probably fair to say that the diminutive Australian pop princess didn’t really have ERP in mind when she sang “Better the devil you know”. But she inadvertently picked up on the thought process that many business owners have when it comes to upgrading their software.

It certainly feels safer and easier to stick with a system that you’re used to and know well, even if you’re well aware of its shortcomings. Change is always risky but keeping a system that isn’t working effectively is an awful lot riskier in the long run.

Embracing change

The problem isn’t that business owners don’t realise they need to upgrade their software. Instead, they are so used to operating in a certain way that they happily plod along with an ageing, restrictive system rather than spending money on a new solution that could improve the business.

When it comes to the growth and success of your business, don’t let your systems hold you back. Upgrading your current software can be a daunting task for any business. The important question to ask yourself is, “What will happen if we do nothing and stick with the same software?”

It’s likely that if you continue to endure the shortfalls of your existing software it could result in:

  • Preventing potential growth
  • Increasing workloads due to duplication
  • Extra man-hours to process orders, reducing order values
  • An inability to develop into new markets and regions
  • Incompatibility with new technologies, such as mobile devices
  • Increased risk to the business
  • Lower morale in the workforce caused by inefficient software
  • Existing software becoming obsolete
  • Loss of information due to crashing applications

Building your case

Unless you want your business to fail, you need to start looking at the available options for a new ERP system as soon as possible. Realistically speaking, it’s highly unlikely that any Managing Director will simply hand over a large amount of cash because of a hypothetical problem being on the horizon. They need concrete facts and figures that can give them clear benefits, measurable results and a profitable return for the business, especially in today’s economy.

To determine whether an investment in new software is a good thing, you need to build and present a business case for ERP that shows ‘the powers that be’ why they should spend their money. Here are some steps you should consider.

Understand and define the business challenges you want to solve

What’s the driving influence behind considering a review? Your processes, your people or the effect that your limited technology is having on the business? There are many things to consider when it’s time to upgrade but some of the most common reasons to review are a desire to grow, the need to reduce costs, inefficient and unproductive processes, and superseded systems.

Consider what advantages there are for your business

The right ERP system will benefit your business in a number of ways;

  • Making growth easier
  • Improving the sharing of information
  • Providing better visibility of future trends
  • Improving efficiency through easy integration
  • Streamlining processes
  • Reducing costs
  • Eliminating duplication,
  • Inspiring faster and better decision making

Think about the time and money involved

Implementing an ERP system can be expensive but if you understand the total cost of the project from the outset, you won’t face any unexpected charges. When budgeting, include costs for software, licences, implementation, compatibility, customisation and development, training, as well as the potential costs of extending the solution and any ongoing maintenance and support. You’ll also need to factor in the cost of annual relicensing of the software with the author.

Recognise the risks involved with upgrading

Being aware of the risks at the outset allows you to address them long before they come up. ERP isn’t the cheapest solution, so the financial implications need to be considered. Potential risks can also involve a lack of buy-in from users, an inability to adapt and use the system, and long implementation processes draining resources.

When you’ve considered and addressed everything above you should be in a strong position to present your case for the business ditching the devil it knows and investing in a slightly more angelic ERP solution.

Once you’ve persuaded your Managing Director to open their cheque book, all you need to do is find the best software and partner to meet your requirements.

Luckily, that’s where we can help, so give us a call.

Written by Mark Blackmore,  QBS Group. 

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