I created this Blog by reusing material from an internal Blog from Dave Loesch. I made only some minor format changes to his text.
the evaluation consultants
Most of the business processes in ERP
have been automated for 40+ years. Who needs a consultant to spend a year on
requirements analysis and comparing vendors when all of the products have
proven themselves or the vendors wouldn’t be in business? Instead, ask for 5 names of customers in your
industry, size and geography who have licensed the vendor’s products and
that’ll narrow the list. (If you can’t find any vendors with 5 customers that
tells you something.
you doing this for the users or the company?
If you’re looking for an enterprise
platform to run your business, know up front that your various departments and
users have different priorities and drivers so getting everyone to agree is
unlikely. Moreover, software experience has provided a consistent answer to
“What’s the world’s best user interface?”
How many months would you need to
evaluate the pros and cons of a motorcycle versus a bicycle? While they both
have similar structures and purposes, it probably wouldn’t take you months to
know which one to concentrate on. Then why do customers compare point solutions
to ERP? Why spend months and millions figuring out if your users like Manhattan
Associates or Maximo more than ERP? Save yourself the hassle! The users will
almost always prefer the point system because they’re purpose built. (No need
to worry about nosey accountants or slow-moving IT folks!) While inspecting ERP
“fit” is reasonable, parading it in front of users next to a point solution is
not the way to get users on board with what’s best for the organization.
Apps stores and downloading software via
the cellular network is really cool. I mean, Angry Birds is so easy and so much
fun! Wouldn’t it be great if I could download a PO app that I really liked?
Well, yeah, but there’s little thing called integration and support that many
cloud ‘paradigms’ don’t contend with. Sure, mobile is great, but can I really
have my mechanics using a phone to access the engineering drawings on a
centrifugal pump? Not being a Luddite here, but customers to need to make sure
that all the cool stuff they ask for (or the vendor demos) is really practical and will be deployed in
One of the biggest problems in a mature
market is customers start to see the vendors as interchangeable as the
products. Buying software from IBM is a world away from buying from Oracle or
SAP! (IBM generates about 60% of their revenue from services and we get under
20%. Do you think their strategic focus—or institutional inertia—is oriented
toward creating repeatable COTS or maximizing services revenue? Likewise, does
ORCL spend more on productization or creating billable moments for consultants?
An ERP decision is a long-term
commitment. Maybe not a full-blown marriage, but close to raising a kid. After
all, the average life of an ERP system is getting longer from 5-7 years to 10+
years. Think about all those Ventyx customers who are wondering if ABB is going
to stay in the software business. Aside
from having a reputation as a technology laggard, ABB just missed a quarter and
replaced their CEO and CTO who pursued the software acquisition strategy. It’s
already out that the new CEO is questioning the strategy leading one to wonder
when the “core competency” press release gets issued. (“ABB is a controls company…). If you buy
your ERP from a private equity firm, a services company or an industrial
automation vendor, you need to recognize you’re not in complete alignment.
Enterprise applications may be critical to you, but for many of these vendors
it’s akin to corporate speculation. They sure aren’t going to upend their
business to focus on (or even remain committed to) ERP.
I hope there’s a message or two worth
exploring with your customer. (Particularly those considering an evaluation
consultant armed with functional matrices!) But, if your customer remains committed to traditional evaluation
models, perhaps they’ll consider this advice of a Fortune 500 CIO who once told
Why would I do 3-4 day demos of products that are
largely interchangeable? (He was looking at SAP, ORCL and MSFT.) Why would I
spend thousands of dollars in travel and lost productivity to listen to another
customer tell me how they chose to implement the system? That was
probably valuable when ERP was new, but I implemented my first ERP system
nearly 20 years ago. With tens of thousands of ERP proof points, what I need to
do is go to Redmond, Walldorf and Redwood Shores and figure out whose culture
and strategic direction best aligns with mine. There’s really little else that
matters when you consider the amount of money and time invested in these 10+
year ERP relationships.