Published on: April 18, 2017
You’ve already budgeted for Acumatica Cloud ERP implementation. But did you budget accurately? There may be hidden costs to your cloud-based ERP project.
Join us for a free webinar on April 25, 2017 to learn how to calculate your return on investment for a new ERP. Register here.
Mindover Software also offers a free white paper entitled The 7 Hidden Costs of ERP. Download your copy today to learn more about these surprising costs and how to account for them.
The ROI Investigation
Kick off your ERP budgeting with an ROI investigation. You won’t need a magnifying glass and deerstalker cap like Sherlock Holmes, but you will need a calculator, spreadsheets or pen and paper, data from your existing reports, and a good understanding of the costs and financial benefits of your ERP system.
All ERP benefits flow from one or more of the following four points:
- Delivering the right products at the right time—improved coordination.
- Enhanced visibility to both production and delivery schedules.
- Improved management of production schedules and workflows.
- Tighter management of personnel, supplies, and equipment.
Your ROI investigation must take into account these four facts. Assign metrics to them and include them as part of your ROI calculations. Ask yourself, for example, how much an improvement in production and delivery schedules will mean to your business. Will it increase orders and decrease canceled orders? Note the answers and use this as part of your ROI calculations.
Unforeseen Costs Hit in Three Key Areas
Along with the potential returns, of course, you must calculate the costs. The initial cost of Acumatica Cloud ERP can be accounted for, but what of hidden areas? These are discussed more in the white paper mentioned above, but most of the hidden costs of ERP fall into one of three categories:
- Time: The expression “time is money” is never truer than when you are implementing an ERP project. Planning, implementing, understanding, and managing an ERP project all take a significant amount of time. That is time that cannot be spent on other projects. Budget for that time as part of the hidden costs of ERP implementation.
- Training: Training is also part of ERP implementation. You will need to create a training program or allocate time for training. Part of training is making mistakes, so it is important to estimate some remedial time for additional training and correcting of errors. Additional time must be devoted to training around system use, documentation, and reports.
- Tailoring: While Acumatica ERP offers excellent features and benefits, it will create changes throughout your organization’s systems. Time must be set aside to examine and revise existing workflows. Personnel may need to be trained and assigned to different job functions. Change in one area, such as ERP implementation, often causes a ripple effect that stretches into surprising areas of your business. You’ll need to tailor things to the new business systems to gain the maximum benefit from them.
The 7 Hidden Costs of ERP will walk you through the methods used to examine all of the costs of ERP implementation so that you do not have any surprises waiting for you. Costs and benefits are all part of doing business, and that includes ERP implementation, as well as other projects. Now is the time to research and examine the potential costs so that you can weigh them against benefits while making your choices.
Mindover Software provides business software and solutions to companies big and small. We welcome your inquiry and can assist you with your ERP, BI, and warehouse management software needs. Contact us today.