What Is Your Business Case for ERP?

PostedOn: 2018-10-10 11:55:31

What does it take to build a strong business case for ERP?

As an ERP consulting firm serving manufacturing and distribution teams, we’ve found that strategic methodologies involve robust analysis and full investigation into what the key drivers are of the project, analysis of which business process is going to be impacted, a clearly defined assignment scope and much more are all critical components when building a business case for ERP.

ERP implementations cut across the entire organization, so the decision of what will and won’t be included will impact the entire enterprise,  the delivery timeline, financial estimates and much more.  Thus, an agreed upon the business case for ERP is imperative

Determining the Business Case for ERP

One of the first steps in beginning an ERP project and launching the business case for ERP is to determine why change is necessary. Through our on-site meetings with the organization, suggests employing a proven process to conduct interviews and visioning sessions with all relevant stakeholders.

The goal of these sessions is to identify the key areas that would be improved upon by a modern enterprise application system.

The Business Case for ERP in Action

As an example, our team was recently engaged with an industrial supplier to help drive business process transformation.

Interviews and investigation with all key stakeholders uncovered the following drivers:

  • Customer Focus

The heightened ease-of-use of a new system would maintain, if not increase, customer focus and energy.

  • Business Processes

Improving ERP would make way for increased and optimized business processes.

  • Organizational Change Management Strategy

With a new system, the manufacturer will have the bandwidth to focus on change management and increase the effort towards general internal communication and collaboration.

  • Revenues

Improving efficiencies via a new ERP system has a direct impact on service revenue and margin.

  • Data Cleansing and Storing

An updated system would have features for data management, allowing the manufacturer to cleanse and migrate their current data from paper into actionable items.

  • Automation

Handoffs and exception management would be improved by newer technology.

Goals Achieved by Building a Business Case for ERP

Again, we turn to the industrial supplier as a use case of the importance of building a business case for ERP.

After we defined a few key benefits of a new ERP system, the next step was to discuss a few goals for the business that would be within reach after updating their business processes:

  • Scheduling 

Up-to-date ERPs typically have modules specifically dedicated to scheduling. After acquiring such a solution, the company would be able to minimize production coordination meetings by easily defining schedules and milestones.

  • Profitability

Defining project profitability and margin drivers at the time of OE would add visibility to basic project measures across the business.

  • Waste 

A new system would reduce waste from duplication of data.

  • Customer Knowledge

An updated ERP system would reduce the time needed to generate a 360-degree view of customers, including sales, marketing, and service data and case management.

  • Customer Satisfaction

By heightening the knowledge of their clients, the company will be able to better serve them, increasing customer satisfaction.

  • Data conversion

As soon as a new system is acquired, the industrial supplier would be able to convert all data from paper systems into the new, automated ERP system.