A recent survey* conducted by Redshift Research for a major player in the ERP industry reveals that ERP users aren't happy with what they're getting. While the article appearing at Information Week talks a lot about mobile access to ERP systems, the ranked response put that issue at number four—when considered by direct mention.
Here is the list of "most important consideration[s] for future ERP implementations" from the more than 1,500 respondents:
- Fast time to value
- Simplicity for all users
- Easy collaboration with customers, suppliers, and employees
- Mobile access for all employees
- A choice of on-premises, cloud, or hybrid deployment approaches
I find it fascinating—but not surprising—that "fast time to value" (read: return on investment) ranks number one in the list.
Here's why: I think all of the remaining items are directly linked to number one—return on investment.
Simplicity for all users
I have frequently told my clients two things:
- Inherent simplicity should rule the day: the more complex a problem appears to be, the simpler the effective solution must be
- The most powerful computer is not the computer with the most RAM, the fastest CPUs, or the most elegant software; the most powerful computer is the one that gets used—and complex, hard-to-use systems are simply avoided by users
There are times when I come into a situation at companies with which I work and find that their technologies are not serving them in portions of their enterprise. Instead, well-intentioned automation has become the "master" and the workers are serving the technology—instead of the other way around.
In such cases, it is high time to seek an inherently simple solution to solving the problem the technology was supposed to solve. Sometimes, pulling the plug on some technologies is the best thing you can do to create real and effective improvement.
Taking the inherent simplicity approach almost always leads to rapid R.O.I. (return on investment) or "time to value."
Last year, I attended the Supply Chain Insights Global Summit 2014 in Phoenix, AZ. There, Lora Cecere, an thought-leader in supply chain management, said, "Simplicity can be the ultimate sophistication."
Easy collaboration with customers, suppliers, and employees
This matter of "collaboration" has always been a tough one. Maybe it is just a matter of our sense of independence as "the American way," but I have found that a great many mid-market enterprises have real difficulty in thinking about their supply chain beyond the four walls of their enterprise.
Of course, I really cannot blame them. After all, at a major ERP software conference I attended a few months ago, the ERP vendor was promoting sessions dealing solely with warehouse automation as "supply chain automation" sessions. Apparently, the ERP vendors are having trouble thinking about the supply chain extending beyond the four walls of the enterprise in which the software is installed, too.
I think most small to mid-sized business enterprises today have not really figured out what "collaboration" should look like. They have lots of unanswered questions about…
- With whom should we collaborate?
- What kinds of data should we share in our collaboration?
- When is collaboration beneficial—or essential?
- Where should collaboration take place—do we meet "in the cloud" or in someone's office?
- What are the real benefits of collaboration? What are the risks?
But, I have a strong sense that the first solution provider that truly makes "easy collaboration" across the supply chain a reality—and provides the supporting change management and guidance to make it effective—will have a huge success on its hands. Mid-market supply chain participants—and there are hundreds of thousands of them—will beat a path to the company's door.
Why?
Because making supply chain collaboration "easy" will, for certain, make number one in the list a reality, too. The firms will get their "rapid time to value."
Mobile access for all employees
To tell you the truth, I think this statement may be a bit of an exaggeration. I do not know of many enterprises that really want to give mobile access to ERP data to "all" employees.
Nevertheless, the concept fits nicely into "rapid time to value." There we are, back at number one on the list again.
Since mobility accelerates the flow of information, it automatically brings in efficiencies that cannot be gained in any other way. And, accelerating the flow of information will also automatically accelerate the flow goods and services all across the supply chain.
Increase the flow of goods and services while also increasing efficiencies and what do you get? Rapid time to value—fast R.O.I.
A choice of on-premises, cloud, or hybrid deployment approaches
The whole world is moving coming to understand a new rule: "Use it; Don't Own It."
Two decades ago, I was trying to get my clients to see this vision. I was just trying to get them to understand the rapid time to value that leasing—versus owning—hardware and software in an ERP environment could bring to them.
Sometimes I would approach them in this way: I would toss a handful of CD/DVDs on the table. The discs would be labeled "Very Expensive Software." Then, I would ask this: "Are those disks I just put on the table worth the $75,000 or $100,000 you are about to spend on your new ERP software?"
Of course, this demonstration got them to immediately recognize that the value in the purchase they were contemplating was in using the technology effectively and not in the ownership of the software.
Today's movement to the cloud is just a further evolution of the same concept. While pricing models still need to honed, it is indisputable that "rapid time to value"—number one on the list—is found in effectively implementing and using the appropriate technologies, and not in owning hardware and software.
That is precisely why the team and partners selected to decide on the ERP system's components and how they will be implemented and used is so very vital to achieving rapid ROI.
Summary
It seems to me that the real, underlying unhappiness of users with their ERP systems all revolve around ROI. However, ROI does not come primarily from the software; it comes from the use of the software.
Implementations, and the decisions preceding and surrounding the implementations, are everything. Effective use comes from effective management of choices surrounding technologies more than from the technologies themselves. This is true all across the supply chain
What are your thoughts on this matter? Please leave your comment below.
