Featured in this post
How To Build a Business Case for Process Manufacturing ERP Technology
How To Build a Business Case for Process Manufacturing ERP Technology
22 Sep 2021Daniel Erickson
Process manufacturing enterprise resource planning (ERP) software is a major commitment, but a game-changing one. And to realize it’s true value, you need your entire organization on board before you make an investment.
When you’re trying to secure buy-in from senior colleagues, making a strong business case and demonstrating potential ROI is critical to success. It’s not just a matter of telling people what manufacturing ERP software can do; you need to demonstrate the bottom-line benefits it will deliver for everyone in your business.
To help you put a compelling pitch together, Aptean has created a six-step strategy for building your ERP investment case. This will enable you to outline ERP software’s role in digitally transforming your business and create criteria from which to choose your strongest-fit solution.
Step 1: Involve Everyone in Your Business
Your objective: demonstrate how every area of your organization will benefit from the introduction of process manufacturing ERP software.
While too many cooks can spoil the soup when you’re choosing an ERP, it’s important that your whole organization is on board with the concept of introducing new technology. Understanding why change is necessary will help your team become more open to new, digital ways of working.
Involving everyone early on will also provide input from all departments on their current frustrations and challenges. This way, team members don’t feel ignored or undervalued—even if they’re not part of the ERP selection group. Equally, the needs of those choosing the technology won’t dominate your ERP selection process.
Gathering a complete picture of your company’s needs will allow you to find a best-fit process manufacturing ERP solution that makes improvements across your business. And getting early buy-in will make it easier to onboard everyone and get them up-to-speed with your new software investment.
Step 2: Prioritize the Challenges You Want To Solve
Your objective: identify where you can add value quickly through process ERP investment.
While manufacturing ERP offers widespread benefits, it’s impossible to transform everything on day one. Rather than trying to boil the ocean, you can build a compelling business case by creating a hierarchy for change.
If you’ve completed step one and talked to each team in your business, it’s likely their feedback revealed some common frustrations. For example:
Lack of accurate data means you’re carrying too much inventory
Scheduling and material availability challenges are causing order delays
Difficulty accessing customer information mean you can’t analyze the profitability of individual jobs or overall customer accounts
Gathering company-wide data allows you to identify the major bottlenecks and inefficiencies that are holding your business back and which of these are causing the biggest obstacle. Understanding and addressing these critical pain points gives you a place to start when implementing new technology.
Step 3: Set Objectives That Align With Your Business Goals
Your objective: show how ERP will generate real business change to deliver rapid ROI.
We’ve already talked about making the link between what process manufacturing ERP software can do and the value that function delivers. For an even more compelling business case, you can align that functionality with your business goals, to ensure your chosen system has the in-built features needed to provide real change.
For example, if improving product costing is a key business goal, then you need to look for process ERP technology that extracts real-time data to generate precise estimates and track lost revenue potential. Equally, if you want to increase inventory accuracy, your ERP solution will need to include a warehouse management system (WMS) with electronic scanning capabilities.
Process manufacturing ERP software is powerful because there’s a huge amount you can do with it. But some of the solutions on your shortlist will have more useful features than others. Mapping technology investment to your business goals will help you solve the critical pain points you identified in step two quickly—and stop you wasting money on solution features that don’t add value.
Step 4: Create a Clear Timeline and Budget
Your objective: set clear deliverables to stop your ERP roll-out from costing too much or taking too long.
Often the barrier to embracing an ERP system isn’t the technology itself, but a lack of clear planning and financial acumen to drive the right choice of software. Your senior team may have been burned from previous projects that snowballed into an expensive failure during deployment.
Process manufacturing ERP software is a long-term investment, rather than an expense. However, you can use clear financial planning and scheduling to demonstrate the total cost to your business and put your colleagues’ mind at ease that this won’t be another white elephant.
Setting a budget will also help you to refine your shortlist of solutions. Use the information you gathered in step three to divide the ERP features you’re looking at into three categories: deal breakers, value-added features and nice-to-haves. You can disregard the nice-to-haves for now if it helps to get your shortlist within budget. Then you can put the solutions with all your deal breakers and value-adds in order of preference.
When you’ve shortlisted your preferred ERP solutions, creating a project timeline will enable you to map out exact what resources you’ll need during implementation, and how long it will take to train key users. This way, you can account for both internal and external costs, and demonstrate how quickly your organization can start reaping the benefits of process manufacturing ERP software.
Step 5: Take Steps To Mitigate Risk
Your objective: understand the factors that could affect your ERP’s performance and put measures in place to reduce their impact.
Going back to the subject of being burnt by previous poor investments, your senior team may still have some reservations about how you’re going to make process ERP technology a success.
Before you pitch your shortlisted software options to your directors or board, think about the possible points at which the roll-out could go wrong. How can you prevent the project (and associated costs) from spiraling out of control? Would a phased implementation enable you to make sure your ERP is performing as you want it before switching over your entire infrastructure?
Mitigating risk means more than finding the best-fit ERP solution; it means de-risking cultural change as well. For example, you may want to create change management initiatives, to help your colleagues embrace the new software. Or develop detailed training programs to make sure everyone feels confident with using ERP technology correctly.
Step 6: Find a Technology Partner Who Understands Your Sector
Your objective: work with a specialist process manufacturing ERP software provider who can deliver the features you need for success.
When you’re pitching for investment in new software, your colleagues will want to know two things: what will ERP do for our manufacturing business, and which manufacturers have your solution providers worked for already?
Choosing a specialist process manufacturing ERP solution is preferable to generalist ERP software because it’s been built for the specific needs of process manufacturers, by a company who understands the demand of this industry.
As part of your shortlisting process, do your homework on each of your shortlisted technology vendors, to understand their track record in your industry. Ask them for the names of process manufacturing companies they’ve worked with—if they can provide testimonials and case studies for you to use in your business case, even better.
Building a Strong Business Case for Process Manufacturing ERP
Putting an investment case together for process manufacturing ERP technology can feel like a lot of groundwork, but it’s short-term pain for long-term gain.
Researching and evaluating vendor options will ensure you find a knowledgeable, experienced partner who can implement the best-fit ERP software for your critical business needs. And you can take this information to your senior team, to show them how an ERP solution will accelerate your business development strategy.
Taking the time to build a strong business case also clearly aligns your investment with the company’s wider business objectives: you see what the future holds, and how ERP can help your organization reach those future goals quicker. Especially when you’re working with a technology provider that understands your market.
Aptean is a leading provider of process manufacturing ERP software. We specialize in digital transformation for process manufacturers, with an ERP solution that drives long-term success.
Ready to start transforming your business?
We’ve got the specialized ERP solutions you need to conquer your industry challenges.