The Cost of ERP – What Makes the Most Sense for Your Business - Part 1

March 24, 2016

Posted by Jack Payne

ERP

 

When beginning your quest to purchase an ERP solution, building a case for the cost benefit should be priority. However, focusing on all of the bells and whistles of a new ERP often overshadows looking at an actual cost benefit and understanding the overall value you are getting with your ERP.

ERP enables you to automate the tasks involved in performing your business process and gives you insight into all of the aspects of your plant. ERP is an expensive investment but it’s important to understand the cost benefits of a full solution.

ERP COST BENEFIT EXAMPLES AND SUCCESSES

Data Collection - The Case of the Expensive Italian Meat

The first week after go live with their ERP, a regular customer ordered their usual type of meat from a well-known Italian meat producer. The user scanned the same meat he had been pulling for years with the data collection application in their new ERP system. The ERP’s data collection system however, failed and would not let him pull the ham. Or did it actually fail? It turned out that the reason the meat wasn’t able to be pulled was because the user had been pulling a higher quality meat at a much higher cost for several years. Thank you to the ERP’s data collection, fixing this one instance alone actually paid for the entire ERP system.

While the instance of the Italian meat may be extreme, cases like this can and will happen. However, there are several other successful ROI opportunities that pay for the cost and help your business benefit from your ERP investment.