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!

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