Measure and Maximize ROI from your ERP Software
Updated: Feb 11, 2020
Thinking about adopting an ERP system or implementing a new one? Let's take a look at how the costs and potential benefits stack up. One of the main benefits of an ERP system is the ability to reduce operating costs. Automation of previously manual processes not only increases productivity but can also screen out costly errors. Increasing the speed, accuracy and efficiency of tracking and reporting. Your new ERP system may also provide standard features that can replace services previously purchased separately.
Here are a few common ways that ERP systems can reduce costs:
Reducing overall operating expenses
Increasing inventory turns or billable hours
Accelerating response time for returns or recalls
Minimizing Accounts Receivable days outstanding
But there are also some benefits that are more difficult to account for yet still produce tangible value:
Improving staff retention through ease-of-use and productivity
Effectively fixing errors in a timely and economical manner
Centralizing documentation online for constant availability of a single source of truth
Making faster decisions due to increased visibility
When mapping out the Total Cost of Ownership (cost to license, implement, train and maintain a system over 5 to 10 years) it is important to also map out the expected ROI from the system over the same period. Historically speaking, many ERP projects run over budget on both time and cost. These overruns can often be traced back to the project management process or to underestimating the cost components. However the value produced by the ERP system is also often underestimated or, even worse, the system is underutilized.
An experienced consultant can provide solutions to both of these problems and help you capture more value from your ERP system or make a new implementation flow smoothly with the team dynamics and existing operational structure. Olsen Consulting specializes in making sure you get the maximum ROI out of your ERP system.