Think right ERP and right partners

Fully 75% of Microsoft Business Solutions' Axapta ERP suite users achieved positive ROI, with an average payback period of 23 months, according to an independent study carried out recently by Nucleus Research. The average deployment time was 13.4 months, with a range of five months to 36 months for a phased deployment. Companies that had not yet achieved a positive ROI had all been using the technology for fewer than two years, and Nucleus projects that most of them will achieve payback in the next six to 18 months. Why did these companies opt for Axapta? Reasons given include the following: 'It was the cheapest and most flexible solution'; 'We did a pilot and felt it could be more easily and cheaply installed than others'; and 'We calculated the expected ROI, projected a two-year payback and achieved it'. Companies cited several key benefits leading to a positive ROI from using Axapta: reduced IT costs (one said yearly costs went down by $150,000 after it reduced work running on the mainframe); improved customer and partner satisfaction; and improved operations and visibility. The point of all that: "ERP doesn't have to be synonymous with bad ROI," says Clyde Bennett, product solutions marketing manager, Microsoft Business Solutions UK. "What this research demonstrates is that when the right system is properly selected, planned and deployed – with the help of well qualified partners – an ERP solution can indeed deliver significant returns for any organisation." How to really grow This approach, he says, is key to driving customer and partner satisfaction. "That is how you not only grow your business, but actually prevent it from shrinking." Bennett believes the way forward for UK manufacturers in 2005 is to "climb the customer intimacy mountain – and they should make a mountain of it, if it's not already there. They need to get up to a level where they can look at their customers and say, 'to serve them properly, I need to evolve business practices that none of my competitors can follow' – and then take tight control of that qualitative process." That 75% of Axapta customers achieved a positive return on their investments from their deployments was largely because they had a clear roadmap from the outset, and experienced guides to help them get there, insists Bennett. And while a long-term successful implementation of ERP is clearly founded on the strengths of the chosen solution, he stresses the other critical factors. "You have to choose outstanding partners to work with to deliver those benefits. Selecting the right reseller is crucial, not only for its skills and expertise, but also in relation to the affiliates on your project. And your partners must have compelling strengths around engagement processes, too." Bennett reckons Axapta helps companies to streamline their processes and communication channels, because it uses "only one business logic, one source code, one database and one comprehensive tool box." This, he states, enables organisations to smooth their workflow by allowing employees, customers, vendors and other business partners to interact directly with the ERP system. "If manufacturing companies in the UK are going to be in business five years from now, they will have to be very nimble in supporting their customers," he observes. "Our approach, at Microsoft Business Solutions, has been to provide absolute flexibility and diverse integration points more smartly and organically than you will find with any 'best-of-breed' system for SMEs. "On a day-to-day operational basis, many companies are mired in old systems, with data that isn't very accessible. What they need to be able to do is to get a team around the table, with the right data and agreed processes, and say, 'Here's an opportunity to innovate and make the customer really happy; we're going to readjust priorities and change the schedules to accomplish this, and make something really important happen'." Bennett says the legacy image of ERP, as intractable and difficult to implement, is fast fading in the light of solutions that empower businesses exactly like that. "Most SMEs are peopled by very thin layers of management, and have had little or no access to such forms of leverage in the past. Where once they might have been wary of an ERP approach, solutions like Axapta are changing everything, giving them new freedoms."