ERP projects have long had a reputation for time and budget overruns, and mostly with good reason. According to Panorama Consulting’s 2016 ERP Report, for example, some 57% of implementations carried out in 2015 ended up costing more than expected, while another 57% took longer than the organisation had originally planned.
So why, in such a mature market, is it still so common for a project to go over-time and over-budget?
There are a lot of different factors that affect the total cost of ownership of ERP. To discuss them all in depth would take a long time. What we’ve often found in the past, however, is that implementations carried out without a process mapping stage – and, specifically, without the level of detail made possible by dedicated process mapping software – are setting themselves up for failure.
Or, to look at it another way, the success rate of ERP projects is much higher when process mapping software is put to use, saving the organisation time and money. Here’s why.
1. You get a complete picture of the business from day one
It’s generally well understood that in order to carry out a successful ERP implementation, you need to understand how the business works and where there’s scope to make its processes more efficient and effective.
But what if this information is wrong? What if there’s a difference between the way users – and especially managers – describe a process, and what that process really involves in practice? It’s easy for this kind of discrepancy to go ignored, often leading to costly recovery efforts a little later down the line when it emerges the ERP solution isn’t working as well as anticipated.
With process mapping software like XSOL, it becomes much simpler to discover and validate critical business processes from day one, meaning a lower ERP spend in the long run.
2. Implementation can be carried out faster, with greater accuracy
Once an organisation and its ERP partner have agreed on a process map, the path to go-live is usually a much less rocky road than if no such step had been taken. The business has a better idea of what to expect from the implementation, and the partner has a stronger understanding of what users’ pain-points are and how to solve them. This means fewer trips back to the drawing board, despite a greater increase in efficiency and productivity in the long run.
3. Process mapping sets the stage for continuous improvement
Finally, putting together a process map is a great starting-point for continuous improvement. A common risk-factor for ERP ROI – even when the project is delivered on time and to budget – is the solution ceasing to meet business needs as the organisation grows and evolves. With process mapping software, you can maintain visibility of waste and bottlenecks over time, and therefore take steps to keep your ERP aligned with the business for the foreseeable future.
This way, you can pre-empt and avoid another costly implementation a little later down the line – and it’s difficult to imagine a bigger saving than that!