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Published bySylvia Fox Modified over 9 years ago
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Selecting an ERP System The good the bad and the ugly!
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Local Vendors Less cost Faster response Market knowledge Accessible Cannot hide or disappear! Here to establish a market No ‘wow’ factor! Too small Little or no marketing No or few packaged solutions Low self esteem
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Foreign Vendors Large size Packaged software Can be Experienced Can allocate resources to project High cost No local support Can hide or run away Customisation woes Here to make a quick buck?! Difficult to assess No local market knowledge
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Typical Foreign Vendor 15 Management and secretarial 10 Sales 70 Support 5 developers, 1-2 experienced, 3-4 rookies! HIGH developer turnover! 100 Employees or more!
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Typical Local Vendor 5 Management and secretarial 2 Sales 7 Support 1-2 developers Developer turnover! Leaving developers set up own business! Initially offer good service/support until they become a typical local vendor. Cycle repeats! 15 Employees or more!
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Reality! Many times inexperienced Can also run and hide. Many times they do! Many times expensive Many times inexperienced Can run and hide Always expensive LocalForeign
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Let’s bind them with a contract! 3 out of the 4 Cypriot companies who bought from the largest ERP vendor in the world are in court with them! The fourth was convinced that everything is OK. Nevertheless, they don’t ask for any support or customisations as they cost too much. They now use Excel to produce many of their reports!
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TCO – What they tell you! Application Price Customisation Implementation (whatever this is!) Training
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TCO – What they don’t say! CustomisationWrite the application! ImplementationFix all bugs of customisation TrainingYou just pay for this! No time to do it. We are still implementing… SupportThe training that should be! InfrastructureExpensive licenses, telecomm lines, Royalties, hourly fees, hardware, more hardware, more software packages… MaintenanceYou pay for it but you don’t know what it covers!
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The big question What do we do?!
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Ask yourself! Do we really need it? Are we ready for it? Do we understand our business needs? Are there any other alternatives?
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Ask others who did it! Are they happy with it? What was the real cost? How long did it take? Would they do it again? Can they account for the cost savings? In general, ask around about the vendors. Cyprus is a small place!
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Check the vendors Other installations at similar companies? Can you visit these other sites? Check to see if they understand your business processes Do they have a sense of proportion? (e.g. did they ask you what your turnover is, etc.?) Ask how long it will take. Usually it does take long!
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If you sign Break the project into small pieces with well defined boundaries Pay only for work delivered so far Keep money for one year or so as warranty Make sure management is actively involved and follows the project closely Pay attention to training
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Keep in mind It does take a long time to decide. It takes much longer to implement! Don’t be impressed by buzzwords/tech talk. They usually mean nothing. For sure they will not make the project work by themselves! Before calling anybody, call your accountant/business consultant. Evaluate your processes for bottlenecks etc. If you don’t know what you need, who does? Have your requirements clearly laid out and written in a small document. It will help the company immensely.
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Conclusions Do your homework well in advance. Evaluate and re-evaluate the company’s management model Set a reasonable budget Develop a firm set of company procedures/processes. An IT solution is only as good as the processes it automates Set up a firm set of specs/requirements Negotiate a total, firm cost in advance Keep in mind: They prey, you pray!
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