{"id":9010,"date":"2015-06-02T08:47:23","date_gmt":"2015-06-02T08:47:23","guid":{"rendered":"https:\/\/eu.syspro.com\/blog\/four-ways-to-achieve-roi-with-erp\/"},"modified":"2021-03-04T14:48:22","modified_gmt":"2021-03-04T14:48:22","slug":"four-ways-to-achieve-roi-with-erp","status":"publish","type":"post","link":"https:\/\/eu.syspro.com\/blog\/planning-for-erp-or-purchasing-erp\/four-ways-to-achieve-roi-with-erp\/","title":{"rendered":"Four ways to achieve ROI with ERP"},"content":{"rendered":"Reading Time: <\/span> 3<\/span> minutes<\/span><\/span>

Return on investment (ROI) is often cited in relationship to ERP but not so often achieved.\u00a0 It doesn\u2019t matter whether you are selecting a new ERP system, are part way through an ERP implementation or living with ERP \u2013 reviewing ROI is the best way to ensure ERP adds value to your business.\u00a0<\/p>\n

Step 1 \u2013 start with the opportunities<\/strong><\/p>\n

Quantify where you think you can achieve a return on investment.<\/p>\n

    \n
  1. Which areas of your business cause you the most pain, how much money would you save by eliminating that pain?<\/li>\n
  2. Where do you think you could add value, new processes which would provide increased opportunities in your market, be a service your customer would be willing to pay extra for?\u00a0 How much additional margin would this generate for your business?<\/li>\n
  3. Talk to your ERP vendor, where have their other customers achieved a return on investment?\u00a0 What stands out to them as obvious pain or gain areas in your business?<\/li>\n
  4. Look out as well as in, could you alleviate pain in the supply chain, e.g. by automation or integration?\u00a0 Would this translate into supplier price reductions or customer price increases?<\/li>\n<\/ol>\n

    Step 2 \u2013 prioritize the returns<\/strong><\/p>\n

    Once you understand the size of the potential returns you need to prioritize.\u00a0 Recognize that you can\u2019t do everything all at once.\u00a0 Classify the list in terms of importance (size of potential return) and difficulty.<\/p>\n

    \"cathi_Roi_with_ERP_diagram\"<\/p>\n

    Step 3 \u2013 plan and deliver<\/strong><\/p>\n

    Form a project team to deliver the benefits.\u00a0 Identify the key \u201cseeker of value\u201d in your business – the individual with the right personality (communicator, negotiator, champion, analytical) to lead the team.\u00a0 Then make sure you have the experts you need in each of the identified areas of return.<\/p>\n

    List the objectives that the project needs to deliver and make those objectives SMART (specific, measurable, attainable, relevant, time-bound).<\/p>\n

    Put a realistic plan together, making sure you don\u2019t overestimate the time this team has to implement the changes, or underestimate the time the activities will take.<\/p>\n

    Support \u00a0the plan from the top, create a senior steering committee to monitor the progress of the plan, make the ROI plan a central theme in the running of your business.<\/p>\n

    Step 4 \u2013 celebrate success and identify more<\/strong><\/p>\n

    Now measure your success against the original objectives.\u00a0 How much return on investment has been realized?\u00a0 How much more could you have realized?\u00a0 What needs to be done to capture the residual value?<\/p>\n

    Reward those involved in generating the return on investment and make sure they get the recognition in the business they deserve.\u00a0 Ensure all employees in the business know what has been achieved.\u00a0 Share the measures, show off to stakeholders: employees, customers, suppliers, your industry how much return on investment you have achieved.<\/p>\n

    Plan the next steps, go back to the original priority list, are there items in the \u2018do it sometime\u2019 list that you could do now?\u00a0 How much value would that realize?\u00a0 Go back to step 1 \u2013 how much has your business changed since you last reviewed your processes vs. your ERP system?\u00a0 Seek out the new opportunities for return on investment that this divergence creates.<\/p>\n

    In summary, to achieve return on investment, follow these simple four steps\u2026\u2026and repeat.<\/p>\n

      \n
    1. \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Identify ROI opportunities<\/li>\n
    2. \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Prioritize returns<\/li>\n
    3. \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Plan and Deliver<\/li>\n
    4. \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Measure, celebrate and start again<\/li>\n<\/ol>\n","protected":false},"excerpt":{"rendered":"

      Return on investment (ROI) is often cited in relationship to ERP but not so often achieved.\u00a0 It doesn\u2019t matter whether you are selecting a new ERP system, are part way through an ERP implementation or living with ERP \u2013 reviewing ROI is the best way to ensure ERP adds value to your business.\u00a0<\/p>\n","protected":false},"author":139,"featured_media":9639,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[272],"tags":[81,88],"class_list":["post-9010","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-planning-for-erp-or-purchasing-erp","tag-maintaining-upgrading-erp","tag-selecting-erp"],"acf":[],"yoast_head":"\nFour ways to achieve ROI with ERP<\/title>\n<meta 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