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What is Your ERP Consultant’s ERP Negotiation Methodology?

What is Your ERP Consultant’s ERP Negotiation Methodology?

During the ERP software selection process, many organizations struggle to understand and compare vendors’ statements of work. Some of these organizations hire ERP consultants to help them navigate the cost variables and negotiate favorable terms.

However, choosing the right ERP consultant can be just as confusing as selecting an ERP system. Any ERP consultant can claim to deliver vendor negotiation services, but not all consultants have an effective methodology. When evaluating an ERP consultant’s vendor negotiation methodology, consider whether it includes these four activities and deliverables:

1. Strategy Development

An ERP consultant should collaborate with you to develop an ERP negotiation strategy. Ideally, they’ll ask you about your goals and priorities. For example, is it more important for you to reduce operational expenses or reduce capital expenditures?

They’ll also help you determine which contract terms are most important to you. These may include terms, such as:

  • Licensing payments should be spread over deliverables.
  • Organization will spend x amount per year.
  • Subscription costs will not be increased for x years.

Costs to Consider During ERP Vendor Negotiations

2. In-depth Price Comparisons

The most valuable deliverable an ERP consultant can provide is a negotiation workbook showing apples-to-apples comparisons of your top contenders. You may have found that vendors’ quotes are not easy to compare. Vendors’ statements of work make various assumptions, such as:

  • You’ll use all software functionality right away
  • You’ll use x amount of out-of-the-box functionality
  • You’ll need x amount of customization
  • You’ll take x implementation approach
  • You’ll use mostly internal resources

A negotiation workbook helps you understand statements of work based on your unique requirements instead of vendors’ assumptions. Your ERP consultant should help you understand your requirements by facilitating activities, such as:

  • Determining an ideal level of software customization, and ensuring you’re only customizing when absolutely necessary (i.e., to improve your competitive advantage)
  • Understanding how many internal full-time resources you can reasonably dedicate to the project and how many vendor resources you’ll need
  • Understanding how long it takes to automate workflows in the system and how complicated it is, as well as who will be configuring workflows
  • Determining which activities should be included in each project phase

Below is a sample negotiation workbook. The spreadsheet allows “what if” scenarios (i.e., what if you get a 30% discount):

3. Total Cost of Ownership Analysis

A long-term view of cost is just as important as a short-term view. The ideal ERP consultant will provide a three-year total cost of ownership analysis – or use whatever timeframe makes sense for the length of your ERP implementation. This analysis should be included as part of the negotiation workbook. The analysis considers factors, such as:

  • Payback period – Panorama clients typically recoup the cost of their ERP implementation within three years.
  • Benefits realization timeframe – Panorama clients typically realize full business benefits from out-of-the-box functionality within 9-12 months.
  • Deployment model – Most ERP vendors encourage a cloud-hosting model and a SaaS licensing model. Organizations that deploy ERP software on premise typically host it in the cloud.
  • Licensing structure – The number of users and types of users will affect your cost if you choose a user-based pricing model. Many ERP vendors underestimate the number of users to make their system seem less expensive.
  • Implementation approach – Will you use a phased, big bang or hybrid approach? If phased, will you phase per function or per module? Make sure your ERP vendor doesn’t expect you to buy all licenses upfront.
  • Software costs vs. service costs – You should aim for a ratio of 2:3 for software costs to service costs.
  • Software configuration – How long will it take you to configure each of your business processes? Are there any process dependencies (processes that need to be set up before other processes)?
  • Resource rates – Panorama clients typically pay $175-225 per vendor resource. If you negotiate this too low, you may end up with rookies on your team.

4. ERP Negotiation Guidance and Coaching

Your team has made large purchases in the past, and you don’t want ERP consultants taking control. The ideal ERP consultant will take a collaborative approach and be flexible enough to respond to your unique needs: they can negotiate on your behalf, prepare you for negotiating with ERP vendors yourself or attend calls with you.

Whichever method you choose, you should aim for cost savings of 30-60%. Your savings will vary depending on your organization size and your chosen ERP vendor. Some vendors don’t go below a 20% discount. You can achieve additional cost savings overtime by ensuring maintenance costs are based on purchase price rather than list price.

Panorama clients typically go through three to four rounds of negotiation, which can last anywhere from three weeks to several months.

 

The Right ERP Consultant

It’s not easy finding an ERP consultant that focuses on all four of these activities. If you’re not convinced these activities will save you money, take a look at these case studies:

  • Panorama recently negotiated more than $15 million in savings on licensing costs alone for a large, multi-national client.
  • Panorama negotiated cost savings for a client that could not afford their top-choice vendor and was about to settle for their second choice.

Typically, Panorama clients achieve cost savings that are ten times the cost of the negotiation services. And Panorama’s performance warranty ensures every client gets a significant discount on their software purchase or they don’t pay us a dime for our time spent negotiating on their behalf.

Schedule a Free 30-minute Consultation With an ERP Systems Expert!

How to Manage ERP Vendors “Like a Boss”

How to Manage ERP Vendors “Like a Boss”

The ERP software selection process isn’t without its share of pitfalls and ambiguities. Few of these challenges are intentionally caused by ERP vendors and their sales reps, but a lack of oversight early in the selection process can come back to haunt your organization during the ERP implementation process.

Five Red Flags

If your vendor is exhibiting any of the following behaviors, consider it a red flag:

  1. Insists on conducting the demo and evaluation process their way, rather than your organization’s preferred way
  2. Controls the tempo and pace of the evaluation process by requesting that they demo last or at a later date
  3. Bypasses working with your project team, and tries to work directly with executives
  4. Creates doubt by criticizing your project team’s approach
  5. Cries foul by expressing concern that they don’t have enough time to prep or don’t agree with the selection process

These patterns are generally more common when the ERP vendor feels they are at a competitive disadvantage to their competitors. Many organizations overlook the warning signs, but this is to the detriment of their entire digital transformation.

How to Manage ERP Vendors

The following methods can be very effective in diffusing vendors’ attempts to control the selection process:

1.  Ensure time to prep with the vendors so they have no reason not to understand your business. This includes sharing demo scripts, outlining key business requirements and allowing access to subject matter experts within your organization.

2.  Allow vendors access to your organization’s key employees. While many sales reps prefer to build strong relationships with your executive team rather than sell the merits of their system, they should have at least some interaction with your employees. Without this relationship building, key employees may refuse to participate in the selection process.[vc_video link=”https://www.youtube.com/watch?v=aj2psg5LSWA” el_width=”60″ align=”center”]3.  Remember that you are the customer, not them. Although it sounds simple, you would be amazed at how demanding sales reps can be. Whatever heartache a sales rep expresses, it is important to remain firm, have confidence in your evaluation process, and demand that they earn your business on merit. You are not expecting too much by asking a vendor to demo their ERP system against your business needs and requirements rather than simply presenting their canned sales demos.

4.  Coach executives to deal with vendors. It is very likely that at least one vendor will bypass you at some point in the process and go straight to someone higher in the organization. Your executive team should be coached on how to handle reps when they call or request a meeting so that those inquiries are redirected to the project team.

5.  Let a vendor walk if necessary. If a vendor thinks their chances of success are slim, they may walk from the deal. Your organization shouldn’t be afraid to let a vendor self-disqualify. After all, it’s not a good sign if a vendor doesn’t have confidence in his or her own product’s ability to compete.

6.  Remember that you can work with another value-add reseller (VAR). Many software vendors sell directly to customers as well as through a network of VARs. If one option doesn’t want to participate, don’t be afraid to look at another VAR that may be willing to participate in your selection process.

7.  Engage with an independent third-party to facilitate the evaluation. Information is power, and having complete and unbiased information about software vendors and their functional capabilities can only be achieved by relying on an independent third-party.

8.  Expect some turbulence and drama. There is no such thing as a software selection that goes exactly as planned. It is not realistic to expect that every vendor will cooperate.

 

ERP vendors that are difficult to work with during the selection process aren’t going to be any easier to work with during ERP implementation. By managing ERP vendors “like a boss,” your organization will save time, money and heartache.

Five Reasons to Select a New ERP System Now Rather than Later

iStock_000030504824MediumIt’s easy to get stuck in your own ways. Organizations stuck on old, outdated legacy systems often deal with the pain of manual and inefficient processes for years before they finally make a change. Our average client has been using their current system for 12 to 15 years – dealing with pain and inefficiency building over that time.

Employees often aren’t in a huge hurry to change anything. Much like a frog in boiling water, they simply get used to the challenges and limitations of their old systems. It often takes an outside perspective to provide a wakeup call or some sort of operational emergency to force the company to change. However, good business sense suggests that earlier is better when determining timing for a new ERP system.

Assuming you foresee a new enterprise solution in your near future, here are five reasons detailing why selecting and implementing a new ERP system makes more sense to do NOW instead of later:

  1. You are leaving too much money on the table. Chances are, your organization is wasting a lot of money on inefficient business processes, poor customer service, employee stress and turnover and other hard-to-quantify but not-so-hidden costs of broken legacy systems.
  1. There are too many good ERP software options available. Back when you chose and implemented your current ERP systems, you probably didn’t have a ton of options, and you definitely didn’t have as many options as you have now. SaaS ERP systems, niche solutions, best of breed software and two-tier deployment models are just a few examples of the variety available to enterprise software buyers. The other good news? Along with this proliferation of options comes lower costs and more financial flexibility that ends up translating to a better return on your ERP investment.
  1. Your organization can’t grow or scale effectively without a new system. Most organizations are struggling to find sources of growth and don’t need any additional headwinds to slow their progress. Even when demand for your product or service is strong, the last thing you need is an operational framework that can’t deliver to that demand. Think about how a new ERP system – along with more efficient business processes and employees – would enable your organization to scale and grow faster.
  1. Your operational breaking point is probably just around the corner. We occasionally work with the unfortunate client that has waited too long to remediate their enterprise solutions and the results typically aren’t pretty. Although the pressures and limitations of your current system may have been survivable for some time, you will eventually reach a breaking point where you simply can’t continue with the old system. By correcting this situation you can avoid putting your team under the gun to implement a new solution quickly, which doesn’t allow for the timely transition that you need.
  1. Morale and productivity is suffering. The stories of what people deal with in their current working environment may border comicality at points. However, these pain points undoubtedly have a very real impact on your overall employee morale, which is inevitably undermining your bottom line. Everyone’s morale and job satisfaction – including yours – will increase exponentially once you have a new ERP system in place to address some of those issues.

The bottom line: if you know you’re nearing the end of your current system’s lifecycle, then getting started on a replacement initiative now will increase your bottom line, allow your company to grow and mitigate risk. In addition, it will give you and your team ample time to take the time necessary to select and implement the best ERP system for your organization.

Learn more about preparing for your ERP transition by registering for our webinar tomorrow, ERP Software Selection Success: 10 Tips from the Pros at Panorama.

Behind the Curtain of Negotiating with ERP Vendors

With new fiscal budgets and renewed momentum in place, the early part of the year is when we see a lot of demand for our ERP negotiation services. Over the last two weeks in particular, I have been helping a number of companies negotiate contracts with their ERP vendors.

After all these years of negotiating contracts for our clients, there are a number of patterns and trends that I look for when working with a firm that is about to embark on an ERP implementation. First and foremost, companies tend to be most concerned about the obvious variables on the surface of any ERP software deal: software costs, maintenance costs, hourly rates, and scope of services. Most CIOs and CFOs go into contract negotiations expecting that their ultimate measure of success will be how much they can hold the vendor’s feet to the fire on these cost items. Indeed, these are all important and should be negotiated aggressively, but they are typically not the things that materially determine the total cost of ownership of your chosen ERP system.

Instead, it’s the things lurking beneath the surface of the deal that really make a difference. It’s those things that may not be obvious, is not on the radar of most executives during negotiations, and often doesn’t even directly relate to the software vendors.  There are three things to keep in mind when negotiating with ERP vendors.

Three Key Things to Remember While Negotiating with ERP Vendors

1. Carefully consider scope, assumptions, and expectations. While it’s nearly impossible to put a price tag on this item, it is the one that arguably will most impact your total cost of ownership. A majority of contracts I review include assumptions that shift much of the workload onto the client and minimizes scope and responsibility of the vendor. Most vendors are willing to negotiate these assumptions for an added cost, or perhaps you don’t want the vendor doing more of the work, but in either case, you want to understand what the implications are, who will handle missing scope activities, and what the costs will be. For example, if a vendor assumes that you the client will handle all data migration activities, that may reduce your vendor’s costs but increase your internal costs.

2. Understand what’s not being discussed during negotiations. When looking at proposed project plans as part of a vendor proposal and contract, it is amazing how often those plans do not include critical project activities. While point #1 above addresses those things that are explicitly omitted from vendor scope or shifted on to the client’s plate, this point has more to do with key activities that should be defined somewhere by someone, but are not. For example, organizational change management is often reduced to basic end-user training.  Business process definition is over-simplified to entail adoption of the software workflows out of the box with no modifications, which rarely ever really happens. The inexperienced eye will typically overlook these omissions from contracts and statements of work, which will significantly increase risk and cost for the ERP implementation.

3.  Where are the buffers and internal project activities? I recently viewed a client contact for a $1B aerospace and defense company, whose ERP vendor priced their contract estimate based on a 23-month deployment. However, there was little to no buffer built into that plan for internal deliverable review, process definition, and other handoffs and reviews between the vendor and client. In this case, yes, we absolutely want to bring down that hourly rate on the services side, but what will really impact cost is the overall duration estimate.  In this case and as with the above two points, expectation management and a sturdy dose of reality is just as important as the dollars and cents negotiated on the contract line items.

Many of these points may seem unrelated to traditional contract negotiations designed to pinch project costs. When completing your ERP software selection process, it’s a lot easier to say “I negotiated 70% off of the vendor’s license price” than it is to say “I identified five things that the vendor left out of scope and as a result increased the initial implementation estimate.” However, setting the right expectations and having a realistic scope and contract in place will absolutely save money, time, and risk in the short and long run.

So instead of thinking about negotiations in terms of how to squeeze the best deal out of licenses, maintenance, and hourly rates, it is more imperative to expand your discussions and planning to include those things that will ultimately affect the total cost of ownership.  You don’t want to come out of negotiations thinking that you’ve scored a great deal only to find that you’ve merely shifted your costs to other budget categories, incurred greater costs in the future, or elevated overall implementation risk. Unfortunately, common negotiation tactics result in these exact problems.

We do this type of work every day with clients and vendors from around the globe. Since we’re independent and are not affiliated with any of the software vendors, we can help you identify blind spots and negotiate the deal that makes the most sense for you. Visit our service offering page to learn more about our ERP vendor negotiation services.

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How Well Do You Know Your Business?

Considering a new ERP system for your business? Can you articulate why need new software? Is it all just a “feeling” that things are not working right? Is it just a “hunch” that data is not integrated? Do you “think” your processes are antiquated or too convoluted?

No matter how small or how big your business is, it is extremely important to understand and to document your processes.

As a consultant, it is always amazing to me how difficult generating ERP requirements can be. Listing requirements, and blueprinting your processes can take months instead of weeks or days without the proper information.

Many companies have little, to no, documentation regarding the functions carried on right under their noses. There are no statistics, no process flows, not even job descriptions that match up to the daily activities within each department. Many companies rely on their managers to make sure things are done right, but never have the ability to measure if it is done “smartly”.

It is next to impossible to determine if a new ERP system is even necessary, if you can’t describe why you really need a system.

And as for measuring the before and after, forget it. With no real metrics for how your business software performs prior to purchasing an ERP system, there is no benchmark for post installation.

There are many reasons to document. Do it now, before you need it!

  • Identifies areas of concern
  • Provides employees with insight into their areas of responsibility
  • Highlights problems that may be fixed internally now
  • Provides you with real job descriptions
  • Identify redundancies
  • Provides benchmarks for improvements
  • Gives you a head start in determining your software needs
  • Speeds selection of software
  • Engages your employees
  • Provides Regulatory and compliance, internal and external audit
  • Develops employee and departmental performance standards

How detailed should you be? Put your processes under the microscope! Ask every question you can think of, and write it down. As an example take a simple task such as order entry and ask the questions.

  • How do we get our orders? EDI, fax, hard copy, phone… and what are the percentages?
  • How many orders do we receive every day?
  • Who receives the orders?
  • Are the orders edited?
  • How many active customers do we have?
  • How many orders do we receive from new customers?
  • How many orders fail in EDI?
  • How many orders cannot be entered without further research?
  • How long does it take to enter an order?
  • How many orders fail credit checks?
  • How long are they on credit hold?
  • What is our processing time from receipt to shipment?
  • How many orders have multiple lines?
  • How many orders can be filled complete on the first pass?
  • Can you promise ship dates at order entry time?
  • Can you verify pricing at order entry time and match to the price the customer sent?

Does it need to be beautiful? No. Flow charts are nice, but a simple word document with step-by-step processes and measurements are sufficient. Don’t forget that by engaging your employees they feel empowered. You may be surprised; the users often have ideas for process improvement.

You get the picture. Leave no stone unturned, especially those processes that identify pains and problems. Your first pass will probably highlight the fact that no one has the answers. So start measuring and keep measuring!

Whether process documentation is used to help with an ERP system or just to improve your processes, these steps are crucial to making a good business a great one!

You are never too small and never too large to identify, document and improve.

Blog entry written by Jeanne Hedman, a Senior ERP Consultant at Panorama Consulting Group.

Starting Up and Stepping Out: ERP Software and the Little Guy

You just developed the greatest thing since sliced bread! Customers are beating down the door, and everything looks rosy! But along the way, you somehow forgot that all that order taking, manufacturing, shipping and receiving, financial transactions and reporting require business software!

And not just any ‘ole software will do. Of course, you know there are pieces and parts that can be purchased for at little to no cost. But then there is that nagging feeling that they won’t talk to each other. And what about all that repetitive data entry? If the data is not integrated, you’ll be loading the same information into each software package. Then it hits you. You don’t have enough people to do that!

You are the Perfect Candidate for ERP Software

“Sure sounds great, but I can’t afford that. I’m a start up and cash is tight. I know I will grow, but how soon? I don’t think I need all that functionality. There is just a few of us running the show today.”

I say it again; you are the perfect candidate for an ERP software package. In fact, you can’t afford not to have one. When the customer orders start rolling in and the production schedule is overwhelming, it will be too late. When you don’t have a solid supply chain in place and you can’t produce your product in time for shipment, it will be too late. When receivables are out of control and you can’t make your payroll or pay vendors, it will be too late.

Most start up companies and small businesses know how to prepare a business plan. They worry about initial investments and they try to prepare themselves for success and many times failure. What they forget to worry about is the long-term management of a successful start up that will eventually start spiraling out of control. Prepare yourself now so your lack of supply is not overshadowed by your inability to meet customer demand. When the opportunity knocks, you want to ready.

You may be right; perhaps you don’t need all that functionality today, but what about tomorrow? Software, or the lack of it, can make or break a great new company. And you want the best for the idea you spent years developing. You want to be able to sustain long-term growth and operational success.

There are dozens of ERP vendors that provide real solutions for the needs you have today and the demands you will have tomorrow. They can grow with you, share in your success and help prepare you to become the entrepreneur you always thought you were going to be. There are ERP software packages with full functionality that require nothing more than Internet connectivity. There are packages that can start in the “cloud” and move into an on-premise solution. There are ERP solutions that are designed specifically for your industry and those that can be configured to your specific needs. And guess what – you can afford it today and you don’t need to wait until tomorrow.

So Where Do You Turn?

Now is the perfect time to select ERP software that is designed around small business growth or your industry. Now is the time to think long-term and prepare for tomorrow. But be sure you partner with the ideal ERP vendor, make sure the ERP system is right for your short-term and long-term business goals and functional requirements.

You have an accountant, a lawyer, and most likely a trusted advisor. They have all helped guide you through the early years of product development, launch, and growth. Technology is no different. You need professional help from a software selection expert. An ERP selection consultant will help you sort through your requirements, locate suitable ERP vendors, and put you on the path of sustainable growth and success. Just like your accountant or lawyer, they bring years of experience. The can help in selecting, negotiating, and even implementing the ERP software. They understand your growing pains, your unique requirements and even the emotional impact of making such a big decision. They are part of the team that has a common goal of making your small business a success.

If this scenario sounds like your business, the ERP selection professionals at Panorama Consulting Group would like to hear from you. We have a service offering specific to smaller businesses. We are here to help you step out and move forward!

Blog entry written by Jeanne Hedman, an ERP Consultant at Panorama Consulting Group.

Episode One of the ERP Reality Series: Software Selection

The ERP project kickoff is an important step in the software selection process. Even though it’s typically a short meeting with the executive steering committee, project core team, and SME’s, it serves as a vital task that helps to create a sense of teamwork, as the blueprint of the process is laid out.

The primary goal of the kickoff meeting is to reach an agreement on how we’re going to proceed and to state the overall goals of the requirements gathering process.

The Script

  • Introduce the various team members and their role in the ERP project.
  • Create a sense of teamwork and motivate the team.
    • This is accomplished through many ways and depends upon the size of the group and client environment.
    • This is one area where you can be creative as long as the creativity goes along with the proper corporate culture.
  • State the goals and expectations of the ERP project. Reach agreement that the goals stated are accurate.
    • There’s few things worse than having the consultant firm come in with their client goals stated incorrectly.
    • Do your own research and ask questions.
    • Get the client to state their goals. Never assume you already know.
    • Remember the old adage: What does “Assume” spell…
  • Educate participants on the software selection methodology.
    • Provide a brief summary of the ERP selection methodology.
    • Always keep in mind that this review was probably addressed multiple times during the sales cycle.
  • Expand on the role of the project management website and it’s expected use as the single source of truth.
    • What? No project management website or centralized system?!
    • Now is the time for you to get one.
  • Perform requirement workshop training.
    • Have a discussion on workshop best practices.
    • Prepare
      • It’s vital that the participants involved in the workshop come prepared.
      • It’s the goal of the software selection team to make the necessary tools available to aid it in this process.
    • Review of workshop tools to be used.
      • Review expectations
      • Review worksheets
      • Give the participants homework, by having the come to each session with 5-10 questions they want to ask.

Things to Avoid

  • Not solidifying the team.
    • This is a prime opportunity to begin aligning the various teams to the project goals.
    • Let’s get everyone on the same page and excited to a part of the project.
  • Not reaching agreement on the project goals. Assuming the clients goals are stated accurately.
    • If you’re going in the wrong direction from the beginning, it’s impossible to end up at the right spot at the end.
    • There will be plenty of opportunities that arise to get you off track, don’t let this be the first.
  • Not listening to the client state what they want out of their project.
    • A successful software selection project depends a lot upon listening to your client and not assuming you know what they want.
    • You may be an expert, but you do not know everything.
  • Failure to build on the initial presentations performed during the sales cycle
    • Every step of the process should build upon the previous step.
    • Every presentation should add to the body of knowledge of the group.
    • Every client visit should build upon the previous one.

Summary

The ERP project kickoff meeting should start with a feeling of great anticipation, similar to that of waiting for the super bowl football game to begin. Everyone is tense with anticipation, waiting for the kickoff. By the end of the meeting, people should feel relaxed and confident of the process as we move forward in the requirements gathering process. They should have a sense of satisfaction and confidence in the process as we move forward into the requirements gathering phase.

Blog entry written by Kevin Cahill, an ERP Consultant at Panorama Consulting Group.

Preparation is Key: Tips for a Successful ERP Software Demonstration

Like most things in life, the more prepared you are for something, the better the outcome. That same principle applies to conducting a successful ERP software demonstration. By following the tips below in preparing vendors and participants, you will already be on the path to a successful ERP demo.

Tips for Preparing the ERP Software Vendor

Explain the ERP Requirements: You spent relentless hours gathering ERP requirements, so make sure the software vendor understands them! An ERP vendor can’t demo what they don’t understand. Don’t get caught letting the actual demo be the time of clarification.

  • Set Expectations: Not only should you explain ERP requirements, but you should also explain what the software vendors can expect during the demo. At Panorama Consulting Group, it is best practice to have the vendors spend the first hour of the day with all SMEs in the room addressing cross-functional requirements (i.e. dashboards and workflow) so they don’t waste time on these requirements during the functional sessions.
  • Dual Stream and War Room: Capitalize on the ERP vendor’s time! If possible, try dual streaming the demo to make sure all material gets covered. If questions are taking over a minute to address, set up a parking lot for later discussion. It is also ideal to set aside a “war room” as a chance for these parking lot items to be answered while vendors are on site.
  • The Early Bird Gets the Worm: Provide the software vendors with an early morning start to test their equipment. Nothing is worse than a room full of anxious participants staring at a blank screen.

Not only should you prepare the vendor before the demo but you should also do the same for the participants as well.

Tips for Preparing the Participants

  • Be Informative: Provide information such as the demo agenda and invites ahead of time. Business must continue as usual, so make sure the participants have time to cover their basis. Also, don’t forget to explain the scoring process so participants can properly gauge the sessions. Using demo scripts to write comments as they go will help jog their memory when inputting their scores digitally.
  • Set Guidelines: The ERP demos are the finale of the requirements gathering process. Attendees should be on time and attend the same sessions for each software vendor. If participants aren’t consistent with attendance, they can’t provide a reliable score.

Last but not least, remember these helpful reminders through the process to keep you on track and increase your chances for a successful ERP software demonstration.

Helpful Reminders

  • Remember to evaluate the ERP software based on requirements as apposed to vendor performance. When all is said and done, your daily life will revolve around the software, not the best performing vendor.
  • Designate a timekeeper to make sure sessions stay on schedule. Once the demos start to venture off track, it becomes very difficult to make up for the lost time. Remember, set up a parking lot for questions and even speak with the vendor before hand about the potential for WebEx follow-ups.

If you would like expert assistance with your ERP software demonstrations, visit our ERP selection page and learn more about our service offering.

Blog entry written by Jacqueline Gardner, a Senior ERP Consultant at Panorama Consulting Group.

Oracle E-Business Suite 12.1 Gives Macsteel Service Centers USA a Modernized Technology Foundation

Redwood Shores, Calif. – July 1, 2010

News Facts

  • Macsteel Holdings, one of the world’s largest private metals service centers, international metals trading and shipping companies, has modernized its technology foundation and improved its operations in North America by implementing the Oracle E-Business Suite 12.1 at Macsteel Service Centers USA.
  • By replacing its legacy system and standardizing on the latest version of the Oracle E-Business Suite, Macsteel Service Centers USA now has a holistic view into its rapidly growing sales and procurement operations, and can keep a pulse on internal and external business trends surrounding orders, inventory, pricing and lead times in order to improve margins, reduce waste and strengthen its competitive edge.
  • During Macsteel’s IT revamp, the company deployed applications including financial management, inventory optimization, advanced supply chain planning and Oracle Transportation Management, which have greatly added value to the Macsteel business process.

Improved Visibility Provides Foundation for Growth

  • Macsteel Service Centers USA is one of the leading metals processors and distributors in North America, and offers one of the largest inventories of metals in the service center industry, processing and distributing metals to customers throughout North America and Puerto Rico.
  • Macsteel previously used a legacy system to track orders and manage financial data. However, this system was not sufficiently scalable and could not provide the management information or insight necessary to make effective business decisions in the highly-competitive, commodity steel market.
  • In 2009, Macsteel made a strategic decision to standardize its IT department and systems on the Oracle E-Business Suite 12.1. The organization began implementing Oracle in May and went live with five of its 30 branches and 100 users in December.
  • In order to meet the specialized needs of the metals service center industry, Macsteel leveraged Oracle Business Accelerators to tie its business requirements to the software using process maps. Macsteel also created software extensions to complement the system without changing the core technology, allowing the organization to easily upgrade and benefit from the latest versions of Oracle software.
  • Macsteel now has an end-to-end view of information across its lines of business and has been able to achieve valuable business advantages:
    • With financial visibility into its extended supply chain costs, Oracle Landed Cost Management allows Macsteel to accurately analyze information such as transportation and acquisition costs in order to improve financial processes and decision making.
    • By using the new converged inventory system, Macsteel has been able to merge process manufacturing with discrete manufacturing inventory into one shared application, delivering a detailed view of overall inventory costs.
    • Running the Oracle E-Business Suite helps the organization track and manage important compliance data for audit purposes, including security hierarchies, raw material pedigree and purchase authorization, and ensures Macsteel retains genealogy and traceability data on its assets.
    • Relying on Oracle Transportation Management, Macsteel benefits from improved planning of shipments and load consolidation while validating freight billing against expected shipment costs.
  • Next, Macsteel plans to implement Oracle Business Intelligence Suite Enterprise Edition to automate its data collection and analysis process.

Supporting Quote
“As a leader in the highly dynamic global steel market, our success is contingent on the ability to make educated and fast decisions based on rapidly changing market conditions,” said Stuart Patsos, vice president of IT, Macsteel Service Centers USA. “Having real-time insight from sales and procurement data enables us to understand and gauge changes in our supply and demand, as well as the trends in the overall marketplace. With the Oracle E-Business Suite, we benefit from a flexible solution that provides the visibility to efficiently optimize our inventory, reduce waste and increase profitability – now and in the future.”

Supporting Resources

  • About Macsteel
  • Oracle E-Business Suite 12.1
  • Oracle Financial Management
  • Oracle Supply Chain Management
  • Oracle Transportation Management
  • Oracle Inventory Optimization

About Oracle Applications
Over 65,000 customers worldwide rely on Oracle’s complete, open and integrated enterprise applications to achieve superior results. Oracle provides a secure path for customers to benefit from the latest technology advances that improve the customer software experience and drive better business performance. Oracle Applications Unlimited is Oracle’s commitment to customer choice through continuous investment and innovation in current applications offerings. Oracle’s next-generation Fusion Applications build upon that commitment, and are designed to work with and evolve Oracle’s Applications Unlimited offerings. Oracle’s lifetime support policy helps ensure customers will continue to have a choice in upgrade paths, based on their enterprise needs. For more information on the latest Oracle Applications releases go to: www.oracle.com/applications

About Oracle
Oracle (NASDAQ: ORCL) is the world’s most complete, open, and integrated business software and hardware systems company. For more information about Oracle, please visit our Web site at http://www.oracle.com.

Trademarks
Oracle and Java are registered trademarks of Oracle and/or its affiliates. Other names may be trademarks of their respective owners.

We Stand for Freedom: An ERP Consulting Firm’s Declaration of Independence

The fourth of July holiday in the US is all about fireworks, a long weekend, and summer barbecues. Even more importantly, however, the holiday is about independence. For over 200 years, our nation has prospered and taken pride in its independence.

Just as our country struggled for its independence from the British in the early days, the ERP software market also struggles with independence, or lack thereof. The market is full of consultants, industry analysts, and software resellers that are aligned with one or more ERP vendors. Even most companies that provide online resources and databases for software selection are paid big bucks by the vendors. So whether you’re subscribing to a vendor evaluation database, viewing a market briefing from a vendor analyst, or hiring a software selection consultant, chances are they are in bed with one or more vendors.

So what’s the fuss? After all, this is how the industry has worked for years, right?

That’s exactly true, it is how it has always been, and therein lies the rub. As our independent 2010 ERP Report shows, 72% of ERP implementations fail, and that’s no coincidence. For too long, companies have been sold products that aren’t good fits for their organizations or have had implementations managed by consultants that don’t have their best interests in mind. In software selection, you need an unbiased partner to help you find the right solution for your business. During implementation, you need someone that isn’t trying to sell you additional software or charge additional fees to customize the system to death. Up until recently, you had two choices: 1) hire a biased consultant or advisor to help you select and implement the right software, or 2) try doing it yourself, with very little to no expertise.

Having been a part of this unfortunate landscape for 15 years and seeing the impact it had on clients is exactly why I started Panorama Consulting Group in 2005. Our vision is simple: to be the world’s leading independent ERP consulting firm. The keys to that vision are independence and focus on being better at ERP than anyone else in the market. Fortunately, our clients and the ERP market see the value in what we do, which helps explain our extremely rapid growth in a down economy.

So what are the questions to ask a consultant, analyst, or online resource to determine how independent they really are? Here are three starting points:

  1. Do you sell ERP software? This is probably the easiest one. If they do, it is impossible for them to be objective and to make your business requirements their priority. Even if they represent two, three, even five different software vendors, that’s only a tiny fraction of the overall ERP market.
  2. Do you receive any financial kickbacks or have any financial ties to one or more software vendors? This is one is not so easy. Ever since I started Panorama five years ago, we’ve been offered large sums of money as “referral fees” in exchange for bringing clients to them. This would have been an easy way to make some cash on the side, but completely goes against our business model. About two years ago a client asked us to guarantee our independence in writing, so we included a clause in our contract that if they found evidence that we were financially or any way aligned with one or more software vendors, we would refund 100% of our consulting fees to them. I have yet to find another firm that is willing to put money where their mouth is. Most consultants, industry analysts, and online vendor database subscription services charge vendors fees of some sort.
  3. Do you have a staff of consultants that focuses on one or more software packages? Having worked for one of the Big 5 firms earlier in my career, this is where a lot of the bigger consulting and audit firms get you. They may technically be independent, but they are going to be more than a bit biased if they have a staff of SAP or Oracle specialists that they’re dying to staff on the next project. I did several ERP selection projects with my former Big 5 consulting firm, and it was no coincidence that we recommended SAP in each and every one of our software selection engagements. Even in cases where SAP was a good fit, our blinders were such that we couldn’t objectively advise the clients on where the risks and weaknesses were with the solution, which every ERP solution has.

In case you’re not familiar with Panorama, we can answer these three questions with a resounding “no,” which is how we’re able to provide independent advice and bring knowledge of over 140 different ERP software solutions to the table. In addition, our independence allows us to provide an unfiltered, unsponsored view of the strengths and weaknesses of each solution, as well as how to most effectively implement them.

Want to learn more? Listen to our most recent podcast below for a more detailed interview with me about the value of hiring a truly independent ERP consulting firm like Panorama Consulting.
[powerpress url=”/Documents/062310-JULY-4TH-SHOW-on-Independence.mp3″]

Have a happy and safe Independence Day!

Five Key Elements for Documenting ERP Software Requirements

As I briefly mentioned in a previous post Six Steps for Executing Successful ERP Requirements Workshops, there are many ways to document an ERP requirements workshop. I stated that the common theme must be to capture an accurate and thorough description of what’s being discussed during the workshop. Ability to dissect a conversation down to an individual functional requirement is also a key factor. In this post, I want to elaborate on the various methods, which can be used to document the project.

Requirements must be defined at various stages of the ERP project. The stage of the project dictates the level of detail that must be captured. For example, during the ERP software selection process it’s necessary to capture requirements at a higher level of detail than during actual ERP implementation. Whereas the level of detail needed to write computer code for a new software program, requires an even higher level of detail.

However, the reoccurring theme is to capture the critical component of a given business process and convert that discussion point into a requirement at the appropriate level of detail.

During a high-level requirements definition workshop, there are a number of tools and techniques, which can and should be employed in order to reduce the risk of missing a key requirement.

  1. Actor Map – defines the relationships among the actors in the actor table.
  2. Actor Table – Defines the roles played by people and things that will interact directly.
  3. Domain Model – Defines groups of information that must be stored in the ERP system and the relationships among the groups.
  4. Use Cases – Describe the major functions that the ERP software will perform for external actors, and also the goals that the ERP system achieves for those actors along the way.
  5. Use Case Map – illustrates the predecessor and successor relationship among use cases.

When documenting the workshop activities, a spreadsheet can greatly assist in organizing each final requirement specification by functional area, which will aid in the final presentation the requirements in the forms mentioned above.

During some of my workshops, with the spreadsheet open on a screen for the group to see, I begin by discussing the pain points of the group’s functional area. This gets the conversation rolling and allows the group to open up about their needs and desires. It also allows me to capture the actors for that area and begin creating a domain model. Within in each functional area, I then ask pointed questions about different subjects within their area. This allows me to capture the detail necessary to produce use cases and a use case map.

Finally, the information captured is usually in a very rough form. It is much more important to capture the essence of the information being presented by the group, than it is to record that information in a formal, grammatically correct and stylish form. The cleanup of the workshop notes can then be completed separately and after the requirements workshop is completed.

Click to learn more about the software selection methodology used within our ERP selection projects.

Blog entry written by Kevin Cahill, an ERP Consultant at Panorama Consulting Group.

ERP Software Selection Testimonial and Success Story: Lessons From the Front Lines

There’s no better way to learn how to manage an ERP selection and ERP implementation process than by hearing it from someone who has just been through the process. Hearing it from a consultant or software vendor is one thing, but hearing it from an actual implementing organization can often times make it seem more real.

One of our recent ERP podcasts featured an interview with a client of ours, the President of a mid-size field service provider that recently selected and implemented new ERP software for their organization. There were several helpful lessons from that interview. For example, the client highlighted some of this lessons and tips from his company’s software selection process:

  • The importance of an independent ERP consulting firm. One of their difficulties was finding a consulting firm that was truly independent and didn’t represent one or more specific software vendors. They looked long and hard before hiring Panorama Consulting to help them select and implement their chosen software.
  • Define business processes and requirements. One of the key aspects of their evaluation was to document the tribal knowledge throughout the organization. They defined new, more clearly defined and standardized business processes that would take their company to the next level. In addition, they used the evaluation as an opportunity to define their business requirements and priorities.
  • Focus on the important stuff. They understood that no ERP system would address each and every business requirement, but they knew which business needs they absolutely had to address.
  • Vendor negotiations are critical. They leveraged Panorama’s experienced team to act as the bad guy and establish their position with vendor, while at the same time protecting them from potential strains with the vendor as a result of the negotiations.
  • Address major challenges. One of their biggest challenges was getting everyone across the company on same page to define what was critical to the company as a whole. In the past, different departments and functions had focused on what was important to their area rather than to the entire company, so ERP was a challenge and opportunity to change that mindset.
  • Key pieces of advice. His comment to those about to select new ERP software is to set realistic expectations for implementation and to understand the total cost and ROI of the investment in the new solution. These are two pitfalls that they almost fell into before being advised by Panorama to set realistic expectations.

There are a host of challenges and lessons in any ERP system selection process. However, these are just a few pieces of advice provided by one of our clients. Listen to the full podcast interview to hear more ERP selection and ERP implementation lessons from the company.

[powerpress url=”/Documents/JOHN-GIBSON-INTERVIEW.mp3″]

New White Paper Assists Process Manufacturers with Development of ERP System Requirements

WAYNE, PA – June 15, 2010 – A new Enterprise Resource Planning (ERP) white paper released by Deacom, Inc., producer of process manufacturing software for mid-to-large sized pharmaceutical, specialty chemical, cosmetics, food and beverage, paint and coatings, and adhesive and sealant manufacturers, provides a guide to identifying business requirements and existing process weaknesses to help batch process manufacturers shortlist suitable ERP software systems.

“There are many, many ERP options available to batch process manufacturers today,” says Jay Deakins, president of Deacom, Inc. “It’s important for these companies to formally assess their business prior to contacting ERP vendors, in order to understand the functionality and type of software that they may require.”

An ERP search process within a batch process manufacturing company typically involves an internal corporate assessment, followed by the addition of relevant ERP software vendors to a shortlist. The shortlisted ERP vendors then carry out discovery sessions to better acquaint themselves with the organization’s unique business processes. After gaining this information, vendors will generally demonstrate how their software can handle the company’s current needs, and often, its future needs. Based on this ERP search process, manufacturers are able to make the appropriate final ERP manufacturing software selection.

“An ERP Needs Analysis” is now available for download at the ERP Resources section of www.deacom.net.

To learn more about the DEACOM Integrated Accounting and ERP Software System or to schedule an online demonstration, call 610-971-2278 ext. 15 or visit www.deacom.net.

# # #

About Deacom, Inc.

Headquartered in Wayne, PA, Deacom, Inc. is the producer of DEACOM, a complete accounting and Enterprise Resource Planning (ERP) system for building component and process manufacturers with difficult-to-handle requirements. The DEACOM System seamlessly links all departments within a manufacturing company, providing a comprehensive view of the entire operation. By making complex issues simple, Deacom helps streamline manufacturing business processes to maximize productivity and profitability.

SYSPRO ERP Choice of Pioneering Medical Device Manufacturer

COSTA MESA, Calif., – June 11, 2010 – SYSPRO, the leading provider of visionary, pragmatic ERP software, has today announced that TransEnterix, a fast–growing medical device manufacturer based in Durham, North Carolina, has selected SYSPRO ERP software after a lengthy selection process that included a thorough analysis of seven mid-range ERP software providers. TransEnterix, which develops pioneering technologies to facilitate minimally invasive surgical procedures, sought new software to “deliver real-time, multi-functional data in various reporting structures to visually accommodate the needs of individual users and groups.” SYSPRO software is expected to facilitate superior inventory controls, forecasting and trend analysis and FDA compliance as well provide management with real-time insight into company operations.

According to Sherry Dickson, System Administrator, TransEnterix had been utilizing disparate Financial, MRP and PLM software packages. “We wanted to move to a single, integrated solution that would support business critical information, facilitate adherence to medical device regulations and provide a snapshot of the company at any point in time. Our goal was to select a cost-effective solution that would be user friendly, scalable, reliable and allow us to consolidate and eliminate older systems.” After narrowing the selection process to two ERP solution providers, Dickson notes that SYSPRO was the clear winner based on the comprehensive nature of the software, the wide choice of integrated modules, system scalability and ease of system navigation. “What really won us over was the endorsement of current SYSPRO users,” she said. “Not only did they stress the ease of implementing the software, but they all alluded to the highly productive nature of the solution.”

About TransEnterix
TransEnterix, a fast-growing medical device company, partners with leading medical thought-leaders to rapidly develop pioneering technologies that advance minimally invasive surgery. The company’s business model involves rapid prototyping, intense pre-clinical labs and hands-on collaboration with surgeons to accelerate learning and bring new technologies to market more quickly. TransEnterix has secured $75 million in venture capital funding. For additional information go to: www.transenterix.com/

About SYSPRO
Since its inception in 1978, SYSPRO has been delivering state-of-the-art business solutions to some of the world’s leading companies. As a global leader in the production of world-class ERP software, the company now caters to the specialized needs of over 14,500 licensed companies in more than 60 countries worldwide. SYSPRO is marketed globally through regional territory distribution centers and a global reseller network in the US, Canda, Africa, Asia Pacific, Australia and the UK.

SYSPRO is a fully integrated business software solution that provides complete control over the planning and management of all facets of business including accounting, manufacturing and distribution operations in a variety of industries.

For additional information on SYSPRO, call Stanley Goodrich at 714/437-1000 or go to www.syspro.com.

All company names and products mentioned in this release are trademarks or registered trademarks of their respective holders.

ERP Vendors Are Working on Upgrades and So is Panorama

When Panorama redesigned its website late last year, we made a conscious effort to have our new website serve as a one stop source for education and news on the ERP industry. In the past week we have continued this quest by launching the first phase of our ERP database.

The new ERP database provides information on the enterprise software industry and lists over 140 software vendors with groupings for the various tier I, II, and III segments. Each ERP vendor has a detailed profile that includes a list of their product offering, an overview of their target market and industry experience, contact information, and recent news or press releases. In addition to the basic profile information, the vendor listings provide an opportunity for website visitors and ERP users to rate their existing software supplier based on a variety of criteria such as presales activity, technical support, functionality, and obtainment of ROI. We feel the vendor profiles and their respective scorecards are imperative for providing an unbiased and unaltered view of the ERP vendors direct from within their user community.

As we move forward into phase two of this launch, we are encouraging the ERP vendors to review their profiles and provide updates, as well as information on their social media communities, literature, white papers, and any images or supplemental content that will help provide the most informative profile possible.

What differentiates this information from other ERP vendor listings is that it is provided for free, without need to register, and without restrictions. While ERP selection and ERP implementation is at the center of our core service offering, website visitors should be informed and educated even if they chose not to engage with Panorama as their chosen independent consultant. This philosophy is aligned with Panorama’s mission statement and the original reason I founded the company years ago.

While the ERP database is quickly becoming one of the most content rich areas of our website, our ERP database is only a part of the upcoming changes. We have more enhancements planned for the 2010 calendar year. I applaud my team for performing due diligence in their research and I look forward to the next phase of functionality that is coming to the ERP vendor profiles.

All of us at Panorama hope the new ERP database helps you and your ERP selection teams become acquainted with the ERP market, as well gives you a baseline for understanding the various offerings and a baseline for choosing the best ERP vendor for your organization’s unique requirements. As always, if my team can be of assistance, I welcome you to contact us so that we can help you make your ERP project a success.

You can visit the ERP database at: //www.panorama-consulting.com/resource-center/erp-database/

Dutch Food Manufacturer Agrico Selects Lawson for Food & Beverage

London, May 27, 2010 – Lawson Software today announced that Lawson Channel Partner Alfa-Beta Solutions has signed a contract for the implementation of Lawson for Food & Beverage with Agrico Coöperatie u.a.. Agrico will replace its legacy software with the industry-specific Lawson solution for the food and beverage industry and use it for the major areas finance, supply chain, enterprise performance management, manufacturing and customer sales & services. The Lawson solution will help Agrico manage its supply chain and help drive business efficiency, which can ultimately help support the company’s market position. The contract with Agrico was signed during Lawson’s third quarter of fiscal 2010, which ended Feb. 28, 2010.

Agrico, based in Emmeloord in the Netherlands, is a farming cooperative of 950 specialist potato growers who grow, breed, collect, process and sell seed potatos, ware potatos and organically grown potatos throughout the world. Agrico sells several organic potato varieties (Agria, Ditta, Toluca and Sante) under the brand name Bioselect. The company is committed to producing high quality products geared to the customers’ specific preferences and demands around the world. Agrico growers have up-to-date cold store facilities and grading stations throughout their working area, and their produce complies with the most recent food safety standards.

The evaluation project has been driven by Lawson partner Alfa-Beta Solutions B. V. Alfa-Beta Solutions is business partner of Lawson since 2001 and a full-suite Lawson M3 channel partner, concentrating primarily on the food and beverage market. Based in Arnhem, the Netherlands, the company employs 16 industry experts and consultants with deep knowledge in management sciences and extensive experience in implementing ERP and business intelligence solution,

“Lawson for Food & Beverage combines industry-specific content with built-in business tools based on Lawson’s experience and knowledge of the food and beverage industry. This made Lawson a great cultural and functional fit for our business. We needed a flexible solution that can grow right along with our expanding business. Lawson and Alfa-Beta Solutions will support us to get greater visibility into customer orders, which helps us provide improved customer service and makes our day-to-day business easier. We have been impressed during the evaluation project by the 100 percent commitment of Lawsons partner Alfa-Beta Solutions and the industry expertise which they have shown during the workshops. Lawson and Alfa-Beta Solutions really understand the business processes and requirements of our specific industry,” said Norbert van der Leegte, project manager for Agrico.

“We focus on providing the most valuable and efficient solutions to our customers,” said Frank Resink, managing partner at Alfa-Beta Solutions. “Alfa-Beta Solutions food and beverage industry domain expertise in combination with solutions from Lawson will help us better meet the needs of our customers in this space and enhance customer experiences. We are proud to have Agrico as an important new customer in our strategic food and beverage vertical.”

American Paper & Twine Turns to Infor to Manage Growth

ATLANTA – May 26, 2010 – Infor, the leading provider of business software for mid-market customers, today announced American Paper & Twine, a top distributor of janitorial, packaging, food service, and office products, has selected Infor ERP A+ to synchronize and manage operations across its five locations in the Southeastern United States. ERP A+, a robust distribution-specific enterprise resource planning (ERP) solution, will provide American Paper & Twine increased productivity and automated workflow.

News

  • As a complex distributor serving multiple vertical markets, American Paper & Twine requires the functionality of ERP A+ to improve the flow of information and enhance decision making capabilities across its facilities.
  • ERP A+ will enhance daily operations while driving strategic expansion for American Paper & Twine, which has rapidly grown to serve the greater Southeastern region of the United States.
  • ERP A+ will provide American Paper & Twine with precise tools that strengthen customer service and improve cash flow.
  • With improved forecasting capabilities from ERP A+, American Paper & Twine will be able to optimize inventory levels while heightening visibility.
  • Additional features, including order entry and warehouse management will advance the company’s order controls and enhance daily workflow management.

What the Customer Says

“When choosing a vendor, it was important that we partner with a knowledgeable company that delivers continuous innovation to meet our needs over time,” said Karen Doochin Shaffer, operations and business applications director, American Paper & Twine. “Infor’s expertise in delivering solutions tailored for the wholesale distribution industry, as well as its plans to enrich and innovate Infor ERP A+, made it the ideal match for our business.”

What We Say

“As distributors expand operations to gain profitability, company-wide data sharing and transparency becomes paramount to enhancing productivity and reducing costs,” said Kelly Squizzero, product manager, Infor. “Infor ERP A+ helps growing wholesale distributors address new business challenges as a result of rapid growth, from increasing inventory turns to reducing transportation expenditure, so they can remain competitive and profitable.”

Additional Resources

Note: registration may be required to access online content

At Infor, we work with a core belief. We believe in the customer. We believe that the customer is seeking a better, more collaborative relationship with its business software provider. And a new breed of business software: created for evolution, not revolution. Software that’s simple to buy, easy to deploy and convenient to manage. Our 70,000 customers in more than 100 countries stand with us. We look forward to your sharing in the results of our belief. There is a better way. For additional information, visit www.infor.com.

About American Paper & Twine
American Paper & Twine Company (APT) provides cost-effective and just-in-time delivery solutions to the companies it serves. APT creates operational value for manufacturing and distribution facilities, administrative offices, healthcare agencies, government, educational institutions, restaurant and catering operations, as well as diverse group of service industries. APT is a one stop shop for businesses large and small, meeting almost any need for any industry.

The Taoism of ERP Software: Use Your Tool Wisely

One misconception I had before researching enterprise software was that an ERP project was simply an IT project and that it was all about installing and testing software. I believe many people think the same way I once did, because when I tell people that I am an analyst and that I perform research on the ERP industry, often times people asked, “so you work for a software company?” I gradually developed a standard answer for these kind of questions: “ ERP software is just a tool. We advise people how to select the best tool, how to use the tool efficiently and how to manage the concurrent organizational issues when implementing the tool.”

Lao-Tzu, the great ancient Chinese philosopher and also a central figure in Taoism, said, “Give a man a fish and you feed him for a day. Teach him how to fish and you feed him for a lifetime.” ERP software, in this metaphor, is like fishing gear. Only when it aligns with an organization’s business strategies and business processes will it improve the enterprise’s actual performance.

Different companies can buy the same ERP system but have dramatically different results because of the various ways of utilizing the ERP software application. Panorama’s 2010 survey results indicate that companies use different strategies to accommodate their business processes for their ERP implementation.

Results show that 22.3% of companies “had very little or no focus on business processes,” which means that their ERP projects were treated more like IT project. This is the worst strategy a company could adopt. Companies like these lack clear business objectives, and the efforts on ERP selection and implementations usually go waste.

Nearly 41.9% of companies “changed business processes to accommodate ERP functionality.” Consultants usually suggest reengineering business processes prior to or concurrent with the ERP implementation and allowing a change agent to manage the numerous changes and ease the transition to the new processes.

A small percentage of companies (8.8%) “changed their business processes independent of ERP, then selected or configured software to align with new processes.” To utilize this strategy, companies usually rely on the assistance of ERP consultants, as they need to select the best software fit, as well as define the most favorable business processes for the organization.

About 27.0% of companies “changed or customized their ERP functionality to accommodate current business processes,” which to most consultants is a surprising figure. It is not typical for a company to totally change or customize ERP software to fit their current processes, as it requires a tremendous amount of work to customize the ERP system while also accurately defining current processes. This relatively high percentage is most likely due to responses from companies which had not yet started their ERP implementation and expected to maintain the lowest level of change to their current business processes. However, what they really should do is not to be afraid of change but to take advantage of the ERP systems’ inherent best practices to improve their business processes.

In a nutshell, an ERP system is just a tool. Learning how to use the tool to effectively leverage operational success within the organization is the key to a successful ERP project.

You can find more interesting content in Panorama’s recently published 2016 Organizational Change Management Report.

Blog entry written by Haoyan Sun, Research Analyst at Panorama Consulting Group.

Life-Science Innovations Selects Lawson Human Capital Management to Help Maximize HR Effectiveness

ST. PAUL, Minn., May 20, 2010 –Lawson Software (Nasdaq: LWSN) today announced that Life-Science Innovations (LSI) has selected Lawson for a multi-application deployment of Lawson Human Capital Management solutions. The implementation will occur in two phases, with the first comprising Lawson Global Human Resources, and Human Resource Management, including core payroll functionality, and the second including Lawson Talent Management. The contract was signed during Lawson’s third quarter of fiscal year 2010, which ended Feb. 28, 2010.

LSI provides guidance, support and funding to support the growth and development of its affiliate companies, which are in the bio-technology, engineering, genetics, and agricultural industries. LSI has more than 1,500 employees, primarily in the Midwest. The company selected Lawson to help integrate its human resource functions, including replacing its legacy in-house payroll system with one that helps streamline reporting processes and helps enable access to critical workforce information by employees and managers across the organization.

“We believe one of the best ways to create value for our customers is to thoroughly understand our workforce’s core strengths, skills and capabilities, and to help our people reach their potential,” said Jonathan Huisinga, director of Human Resources at LSI. “The Lawson offerings will help us align our HR activities with our business objectives and improve our recruiting and retention capabilities.”

Specifically, the planned Lawson deployment brings together core applications, including:

  • Lawson Global Human Resources, which will help define organizational and supervisory infrastructure to help streamline management processes.
  • Human Resource Management, which will help reduce time spent planning, reporting, managing and maintaining core human resource processes, helping to free time to focus on core organizational initiatives.
  • Lawson Payroll, which will help provide a smoother, more comprehensive payroll process, complete with the capabilities to address complex regulatory and reporting tasks.

“LSI’s selection demonstrates how Lawson Human Capital Management solutions can help an organization meet its business objectives by focusing more strategically on organizational and management infrastructure,” said Larry Dunivan, senior vice president of Human Capital Management Products for Lawson. “LSI wants to build out its human resource functionalities to support a stronger workforce, while reducing costs and creating more opportunities for the future. We are pleased to be delivering solutions that can help provide essential information about employees and roles within an organization to help achieve these initiatives.”

About Lawson Software
Lawson Software provides software and service solutions to 4,500 customers in equipment service management and rental, fashion, food & beverage, healthcare, manufacturing & distribution, public sector (United States), service industries, and strategic human capital management across 40 countries. Lawson Software is a global provider of enterprise software, services and support to customers primarily in three sectors: services, trade and manufacturing/distribution. Lawson’s solutions include Enterprise Performance Management, Human Capital Management, Supply Chain Management, Enterprise Resource Planning, Customer Relationship Management, Manufacturing Resource Planning, Enterprise Asset Management and industry-tailored applications. Lawson solutions assist customers in simplifying their businesses or organizations by helping them streamline processes, reduce costs and enhance business or operational performance. Lawson is headquartered in St. Paul, Minn., and has offices around the world. Visit Lawson online at www.lawson.com. For Lawson’s listing on the First North exchange in Sweden, Remium AB is acting as the Certified Adviser.

Forward-Looking Statements
This press release contains forward-looking statements that contain risks and uncertainties. These forward-looking statements contain statements of intent, belief or current expectations of Lawson Software and its management. Such forward-looking statements are not guarantees of future results and involve risks and uncertainties that may cause actual results to differ materially from the potential results discussed in the forward-looking statements. The company is not obligated to update forward-looking statements based on circumstances or events that occur in the future. Risks and uncertainties that may cause such differences include but are not limited to: uncertainties in uncertainties in the software industry; uncertainties as to when and whether the conditions for the recognition of deferred revenue will be satisfied; increased competition; general economic conditions; the impact of foreign currency exchange rate fluctuations; continuation of the global credit crisis; global military conflicts; terrorist attacks; pandemics, and any future events in response to these developments; changes in conditions in the company’s targeted industries and other risk factors listed in the company’s most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K filed with the Securities and Exchange Commission. Lawson assumes no obligation to update any forward-looking information contained in this press release.

J.R. Watkins Live on Lawson QuickStep Enterprise Solution

ST. PAUL, Minn., May 20, 2010 —Lawson Software (Nasdaq: LWSN) announced today that J.R. Watkins recently completed an organization-wide deployment of Lawson QuickStep Food & Beverage. The Lawson Quickstep solution, which is designed to help meet the unique demands of the food and beverage industry, will help J.R. Watkins coordinate its financial, manufacturing, supply chain and procurement processes. This will help reduce the time, cost and risks associated with bringing its products to market. Lawson QuickStep solutions provide a proven foundation for faster, successful enterprise software implementations.

J.R. Watkins also selected CIBER, Inc., a leading international IT outsourcing and software implementation consultancy specializing in Lawson M3 solutions, to partner with Lawson to provide implementation support. In addition, CIBER provided project management expertise and employee training workshops to help J.R. Watkins realize a smoother transition to using the new Lawson system.

J.R. Watkins, based in Winona, Minn., is a natural consumer products manufacturer with specialties in personal care, home care, remedies and organic food flavorings. The company is known for its natural, environmentally friendly ingredients and is emerging as one of the largest companies in southeastern, Minn. To help it maintain its competitiveness during this growth period, J.R. Watkins needed to update and align its business processes to improve efficiency.

“Our old system was comprised of several disparate software systems that didn’t talk to each other. This created data redundancy, data integrity discrepancies and considerable manual efforts to access and input information from procurement to finances,” said James Yenish, vice president, Operations, J.R. Watkins. “We chose Lawson and CIBER because we felt confident in Lawson’s food and beverage industry expertise and CIBER’s technical implementation expertise. We needed a flexible solution that can grow right along with our expanding business. Lawson and CIBER helped us move to a leaner environment. With this cohesiveness, we have greater visibility into customer orders, which helps us provide improved customer service and makes our day-to-day business easier.”

“The U.S. food and beverage industry faces many challenges today, including ever-increasing pressures on profit margins,” said Jeff McKinnon, director, Food & Beverage, Lawson. “Lawson QuickStep is designed to help companies like J.R. Watkins streamline and simplify complex supply chains. And since it can help companies get up-and-running quickly on their enterprise software, Lawson can help deliver faster business benefits for our customers’ technology investments.”

About Lawson Software
Lawson Software provides software and service solutions to 4,500 customers in equipment service management and rental, fashion, food & beverage, healthcare, manufacturing & distribution, public sector (United States), service industries, and strategic human capital management across 40 countries. Lawson Software is a global provider of enterprise software, services and support to customers primarily in three sectors: services, trade and manufacturing/distribution. Lawson’s solutions include Enterprise Performance Management, Human Capital Management, Supply Chain Management, Enterprise Resource Planning, Customer Relationship Management, Manufacturing Resource Planning, Enterprise Asset Management and industry-tailored applications. Lawson solutions assist customers in simplifying their businesses or organizations by helping them streamline processes, reduce costs and enhance business or operational performance. Lawson is headquartered in St. Paul, Minn., and has offices around the world. Visit Lawson online at www.lawson.com. For Lawson’s listing on the First North exchange in Sweden, Remium AB is acting as the Certified Adviser.

Forward-Looking Statements
This press release contains forward-looking statements that contain risks and uncertainties. These forward-looking statements contain statements of intent, belief or current expectations of Lawson Software and its management. Such forward-looking statements are not guarantees of future results and involve risks and uncertainties that may cause actual results to differ materially from the potential results discussed in the forward-looking statements. The company is not obligated to update forward-looking statements based on circumstances or events that occur in the future. Risks and uncertainties that may cause such differences include but are not limited to: uncertainties in uncertainties in the software industry; uncertainties as to when and whether the conditions for the recognition of deferred revenue will be satisfied; increased competition; general economic conditions; the impact of foreign currency exchange rate fluctuations; continuation of the global credit crisis; global military conflicts; terrorist attacks; pandemics, and any future events in response to these developments; changes in conditions in the company’s targeted industries and other risk factors listed in the company’s most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K filed with the Securities and Exchange Commission. Lawson assumes no obligation to update any forward-looking information contained in this press release.

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