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Calculating ROI for ERP implementation

Calculating ROI for ERP implementation

One of the biggest challenges to a successful enterprise resource planning (ERP) implementation is actually getting the project approved and off the ground.  Creating a strong business case for ERP implementation will require a strong return on investment analysis (ROI).  ROI for ERP implementation is a critical calculation.

Organizations that gain the most value from an ERP system conduct ROI for ERP implementation analyses at nearly every stage of the project, according to a 2012 Aberdeen Group report on ERP Implementation and Training.

Unfortunately ERP implantations are frequently viewed as a necessary evil rather than an opportunity to improve business processes and take an organization to the next level or take a product from research and development into production. 

The first step to having a favorable outcome in terms of ROI for ERP Implementation is to proceed with the frame of mind that the implementation is a business initiative not a technology initiative.

A recent article at Panorama Consulting listed five considerations for successfully calculating ROI for ERP Implementation.

1. Set the bar high for your ERP implementation
Rather than operating out of fear of failure, think what the ERP software functionality you need to take your business to the next level.

2. Focus on people and processes, not technology
Creating favorable ROI for ERP implementation will come down to how well you handle organizational change management and how employees use the system.

3. Don’t underestimate the cost, time and effort required for your ERP implementation
Setting realistic expectations from the start is critical part of a successful implementation.  So, conservatively over-estimating all your costs will keep you out of trouble.

4. Understand where the finish line really is
Much like the previous tip on budgeting, over estimating time will give you the space you need to finish the project well.

5. Focus on the long-term alignment between your business and your new ERP system
There really is no true “end” to the ERP implementation. Your business processes and employees change all the time, so your ERP system has to organic and change with the times in order to avoid misalignment with processes.

With a cloud based ERP solution from Microsoft Dynamics ERP you can eliminate many of the challenges commonly associated with ERP implementations.  With Dynamics in the cloud it is possible to shrink the budget and shorten the deadline for your project, leading to successful ERP implementation ROI with low total cost of ownership.

Start a free Microsoft Dynamics ERP trial in the cloud today and see for yourself how fast and simple it is to start moving forward with a new ERP solution.


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