Understanding the Differences Between Leading ERP Software Solutions
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1 Understanding the Differences Between Leading ERP Software Solutions April 1, 2010 Eric Kimberling, President Panorama Consulting Group
2 Agenda Brief Introduction to Panorama Consulting Purpose of this Webcast Review of Panorama s 2010 ERP Report Comparison of Leading ERP Software Vendors Best Practices in Selecting ERP Software Questions and Answers
3 About Panorama Consulting Niche consulting firm with critical mass in the ERP market We Provide Three Primary Offerings: o ERP Software Evaluation and Selection o ERP Implementation Project Management o ERP Organizational Change Management and Benefits Realization Experience with 100+ ERP packages Depth in targeted industries, including manufacturing, distribution, supply chain, and high-growth companies ERP Vendor Independent and Neutral
4 Some of Our Clients
5 Broad and Deep ERP Expertise
6 Agenda Brief Introduction to Panorama Consulting Purpose of this Webcast Review of Panorama s 2010 ERP Report Comparison of Leading ERP Software Vendors Best Practices in Selecting ERP Software Questions and Answers
7 Purpose of This Webcast To learn from Panorama s benchmarks how companies implemented their ERP solutions To understand how the results differed in different ERP vendors compare to global implementation benchmarks Provide guidance on how companies can achieve best-in-class ERP results
8 Agenda Brief Introduction to Panorama Consulting Purpose of this Webcast Review of Panorama s 2010 ERP Report Comparison of Leading ERP Software Vendors Best Practices in Selecting ERP Software Questions and Answers
9 Overview of Panorama s ERP Study Surveys completed by 1,600 organizations across the globe Additional deep-dive and interviews with sample of organizations Included organizations that implemented a variety of ERP solutions Tier I Tier II Best of breed and niche
10 Common ERP Challenges Three-year study of over 1,600 ERP implementations across the globe Full report available at:
11 Overview of ERP Software Vendor Analysis Top 4 challenges companies face: Lack of employee buy-in Lack of ERP expertise Lack of project resources Too small of a budget 78% of implementations took 6-18 months Only 43% of projects finish on time while 35.5% took much longer than expected
12 Results of Panorama s 2010 ERP Report 51.4% of ERP implementations go over budget 72.2% of respondents are satisfied with ERP
13 Agenda Brief Introduction to Panorama Consulting Purpose of this Webcast Review of Panorama s 2010 ERP Report Comparison of Leading ERP Software Vendors Best Practices in Selecting ERP Software Questions and Answers
14 Market Share of Leading Vendors Tier I Vendors SAP Oracle Microsoft Tier II Vendors Epicor Sage Infor IFS Lawson CDC Software Others
15 Average Implementation Duration
16 Implementation Duration vs. Expectations
17 Average Implementation Total Cost of Ownership Average Implementation Cost (US$) SAP Oracle Microsoft Tier II Industry Average Average Cost Cost as % of Revenue Median / Q2 $16.8 M $12.6 M $2.6 M $3.46 M $8.47 M 18.6% 10.6% 5.0% 6.7% 9.0% $4.5 M $2.2 M $0.44 M $1 M $1.55 M
18 Implementation Cost vs. Expectations
19 Average Vendor Satisfaction & Benefits
20 Vanilla vs. Customized ERP
21 Average Benefits Realization Over ½ of ERP implementations fail to realize at least 30% of expected business benefits.
22 What the Numbers Say: ERP Challenges Are Not Uncommon 64% of respondents are satisfied with their selected vendor and 63% feel that their implementations were successful The proportion of companies that suffered from operational interruptions following go-live are relatively high SAP Oracle Microsoft Tier II Business Risk Factor 50.0% 56.9% 57.7% 61.8%
23 Microsoft Dynamics No. 3 market share Shorter duration but high level of variability Lowest cost: predictable and consistent Medium benefits realization Medium satisfaction Medium business risk Summary: Low and predictable cost/duration, but average satisfaction and benefits
24 Oracle No. 2 market share Duration below average and highly predictable Above average cost, second to SAP Lowest benefits realization Highest executive satisfaction but lowest employee satisfaction Medium business risk Summary: Very predictable and reasonable implementation time, high cost, high exec sat
25 SAP No. 1 market share Longest duration and high level of variability Cost more than others and cost 2X average Highest satisfaction Lowest business risk Summary: Very high and unpredictable cost and duration, but highest satisfaction
26 Tier II Vendors 30% of market (up from 23% in 2008) Shortest implementation duration Below average cost Above average satisfaction Above average business risk Summary: Lowest implementation duration, below average cost, above average satisfaction, above average risk
27 Agenda Brief Introduction to Panorama Consulting Purpose of this Webcast Review of Panorama s 2010 ERP Report Comparison of Leading ERP Software Vendors Best Practices in Selecting ERP Software Questions and Answers
28 Seven Tips for ERP Selection 1. Define clear goals for your ERP project 2. Clearly define business requirements in detail 3. Choose the right software 4. Set realistic implementation expectations 5. Involve employees and system users 6. Develop thorough business processes & workflows 7. Position ERP for Benefits Realization
29 Benefits of a Successful Software Selection Process Reduces business risk Structured process ensures the right functional fit Injects sense of reality into vendor evaluation and implementation planning process Reduces implementation cost Investment in an effective evaluation and selection process saves money later Effective negotiation with vendor reduces total cost of ownership Establishes foundation for optimized ERP results ERP benefits realization Include ERP success factors in selection and implementation planning process
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