With budget cuts sweeping across many of the nation's IT departments, the thought of adding high-priced ERP software and the expenses of hiring an ERP consultant to your payroll is a daunting prospect for most businesses today. What many companies fail to realize, however, is that the right ERP consultant can minimize ERP risk, accelerate the deployment process and increase the success and value of your ERP undertakings.
That's because an ERP consultant is more than just a highly skilled third-party provider. Irrespective of the pros and cons of an ERP consultant, they possess in-depth understanding of how to structure, upgrade and monitor a company's ERP system to ensure that it runs smoothly and reliably.
Still not convinced? Here are the top five reasons you should consider hiring an ERP consultant to help with implementing an ERP.
1. Making sense of the complex
With its complex interfaces, layers of configuration and robust capabilities, an ERP system can be a beast to implement. Just ask trash-disposal heavyweight Waste Management who filed a lawsuit against ERP provider SAP for $100 million to cover the cost of its failed ERP implementation. And then there's the case of consumer goods giant Nestlé who committed six long years and $200 million to its ERP implementation.
"ERP systems are pretty complicated, especially the high-end ones," warned Paul Hamerman, a research analyst with Forrester Research. "Companies need the expertise of people (ERP consultants) that have done it before to really help accelerate a project and get the system up and running sooner."
While an ERP consultant can advise your teams on the best course for system implementation, they can also help address and resolve ERP implementation issues together with your IT department, should they arise.
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2. High-speed deployments
Unfortunately, multi-year deployments aren't exactly unheard of when it comes to ERP technology. However, Hamerman said that, "By bringing in outside resources that have experience with ERP software, the job can get done quicker."
What's more, there are a number of distinct skills that are required to properly implement an ERP system. As a result, not only can a highly skilled ERP consultant get the ball rolling faster but he or she can save a company the time and energy needed to locate those specific skills in-house.
3. Spending money to cut costs
An ERP vendor may try to convince you to retain its IT consulting services, but think twice before signing on the dotted line. For starters, warned Hamerman, "The vendor has the brand name of the product and tends to command higher rates, but that doesn't necessarily mean it has better skills to implement the system. Sure, the vendor will argue that it has an advantage, but I don't really see it. Companies are just as well off with third-party firms."
According to Eric Kimberling, president of Panorama Consulting Group in Denver, an ERP consultant can also help you save money in ways a vendor can't. That's because outside ERP consultants are often able to negotiate a lower product rate for their clients when selecting ERP software options. "We will generally save our clients four to five times our fees just in negotiating with the vendor," said Kimberling. "It's all about knowing what levers to pull, how they make their money and knowing what other clients are paying for the system."
4. An objective opinion
The vendor's account reputation and your IT people may be singing the praises of an ERP system, but it never hurts to hear an objective opinion. "Having an independent set of eyes that knows the industry well and specializes in the ERP space can be very valuable," said Kimberling.
But not any old ERP consultant will do. Warned Kimberling, "It's important to have someone who's not in bed with any of the software vendors, because you want to find the software that's right for you — not the one that the consultant is getting the kickback on."
5. No more blame game
You're bound to encounter a few bumps along the road to a complete ERP implementation — hiccups that can lead to vicious finger-pointing among IT leaders, techies and C-level executives. Handing an ERP implementation over to a third-party provider, however, reduces the risk of blame-game theatrics.
What can an ERP consultant offer you?
We believe hiring an expert ERP consultant can save you from things going south particularly when you have only recently implemented the system. Since many things can go downhill if not tended to by an expert, unless you have trained and capable resources, it is best to hire an ERP consultant!
- Expertise and knowledge: the ERP consultant must possess and exhibit the perfect mix of industry expertise and experience, business knowledge, and communication skills to ensure the success of your project.
- Product familiarity: Hiring an ERP consultant means equipping your workforce with an expert member who is familiar and comfortable with using the software. Apart from their familiarity and knowledge of the features of ERP software, your consultant has acquired the essential skills for handling the software, giving clear directions, and helping your team in understanding how to manage and mitigate setbacks.
- Unbiased approach: Hiring a third-party ERP consultant with no personal or professional affiliations to any ERP software vendor helps you in getting unbiased advice in choosing your vendor. An impartial consultant will also inform you when the software is no longer serving the purpose for you.
- Risk management: An ERP consultant having your back means a smoother journey as your workforce eases into using a new system. With an expert around, your team will better understand the importance of your investment.
- Clarity of expectations: an ERP consultant should help you learn how you can work better with your current solution, as well as the impacts of implementing a new system on your organization. This way, your employees understand the true goals of an ERP, so its use can be maximized for optimal productivity,
Final verdict on hiring an ERP consultant
Hiring an ERP consultant may seem like an expensive decision, but it might help you keep costs down in the long-run. Consultants can help your business implement an ERP efficiently and successfully. Moreover, your IT staff and other employees can focus on their primary responsibilities.
Before hiring a consultant, however, make sure you find someone that can best meet your company's unique needs. Ask the right questions when interviewing candidates, and check up on their references. You don't want to be stuck with someone that can't deliver on their promises.