ERP Flavors: Vanilla or Custom?

December 13, 2011 By
Happy Holidays

Happy Holidays!

Should you customize your ERP system to match your existing business processes or adapt those processes to the best practices embodied by the enterprise software?  It’s an old and oft-considered question; second only to “build or buy?”

Conventional wisdom tells us to just leave software alone to get the best value and return from it.  The stated reasons are also classic and valid: the ‘domino effect’ of breaking some unintended function by customizing another, much more costly and complex upgrades (or being prevented from upgrading), delayed go-live dates, lack of vendor support for your customized code, dependence on whoever did the customization, and increased documentation costs to have help files accurately reflect the customized system’s operation.

In the face of such common sense reasoning, why would anyone undertake an ERP customization?  It’s notable that despite many companies’ best intentions for vanilla implementations, the majority of ERP customers use customized software.  The primary reason is competitive advantage.  If your business process delivers an advantage, it’s likely to be worth the cost and complexity to adapt your ERP software to match that process.  If not, it may be simpler and less costly to adapt your processes to the best practices built into the software.

In either case, careful consideration of the comparative value of business processes and software solutions should always precede customization. The inclination to change one often indicates a shortcoming of the other.

Once you’ve determined that customization makes sense, the project should be approached like any other implementation:  Careful project controls and a disciplined framework are strong predictors of success.

Filed Under: ERP Implementation

Is ERP Implementation Ever Really Over?

December 2, 2011 By

Time and change are the only constant with enterprise resource planning…

Here’s the usual situation.  A company decides to improve their company with a comprehensive IT system that will help them manage financials, human capital, supply chain, and their product life cycle.  This system must provide a centralized brain to store data and to oversee both the strategic and tactical processes of the company.  It’s ideal if this system can do all of this in an efficient manner.  But can any system achieve this goal?  Possibly.  What is the best system for the job?  It’s an enterprise resource planning system.

If only it were that easy.  Unfortunately, ERP projects can easily go awry and do so more often than not.

Imagine a using a compass to navigate from a home to an undefined location.  The compass is virtually useless until the location is defined.  Once the location is defined, then the navigator must follow a true course to reach that location.  If the navigator is even one degree off at the beginning of the journey, or at any time during, he or she will never arrive at the designated place.  Small navigational errors compound and multiply until the only way to succeed is to go back to the beginning and start again.

In ERP implementations, the first place many of these projects get off course is in the initial planning stages. Unrealistic budgets are set and resources are under-allocated.  Many executives frequently underestimate ERP costs and rarely realize that implementations span several years and involve endless amounts of organization-wide effort and change.

The 2011 ERP Report by Panorama Consulting says:

“ERP systems don’t end at the software purchase; they require changes in business practices across the entire company…Moreover, ERP vendors, in efforts to make their bids more competitive, have been known to underestimate the complexity of the implementation and suggest and unrealistic project plan to company executives.”

Some of the top unanticipated costs that expand budgets and lengthen the duration of ERP implementation include:

  • Employee training
  • Software customization
  • External consulting assistance

These three unanticipated costs are interlinked.  For example, the ongoing need for employee training and external consulting assistance revolves around software customization.  This is because “plain vanilla” software simply isn’t sufficient for approximately 85% of businesses; 70% choose at least minor customization.  Then, once implementation begins, many companies get off course.

The next step for companies, then, is to determine how to take full advantage of the potential increased functionality waiting for them…if they could only get there.  This is where many companies go back to the beginning, hire a consultant, and take the time to define their business process and train their employees to successfully leverage ERP system capabilities.

According to the 2011 ERP Report:

“Deciding on the right level of customization for a company’s business processes is critical to the success of an ERP project. While customization can enhance the value of out-of-the-box software and allow the company to maximize its cutting-edge advantages, it also can result in high implementation costs without the realization of expected benefits.”

The new 2011 trends, for ERP, have turned out to be: over-estimate project scope and cost, spend less overall than planned, customize only as necessary, get consultant help before getting off course, and hang in for the long-term.

Works Cited

Panorama Consulting Group. (2011). 2011 ERP Report. Retrieved November 2011, from http://Panorama-Consulting.com/resource-center/2011-erp-report/

Filed Under: ERP Implementation, Technology

Power to the CEO

November 30, 2011 By

What do chief executives want today? It’s not money.

Today’s CEOs and business owners are dealing with a world full of intense complexity. Decisions need to be made faster than ever to keep up with the chaos in the business world. This pressure, felt most keenly by CEOs, is attended by incredible amounts of stress. Bill Wilkerson, himself a CEO and expert on the effects of stress on an organization, notes, “In 2001 an executive officer could expect to have 15 years to fully implement an agenda…” however today, the average longevity for CEOs in North America is less than three years.[1]

On the other hand, is it possible to reach the end of the career road, to max out? Is it possible for a company to reach a plateau? Yes. Many of today’s workers, especially chief executives, are not happy with business as usual. They want more from their jobs and they are determined to get it.[2] “Case in point: in a fortune 500 firm, fifteen top executives are asked what they really want. It’s not money. What they want is development.”[3]

According to the 2011 Sherpa Executive Coaching Survey, workers today have all the skills. Therefore, training is not the issue. The big issue is development – meaning behavior – which is the other half of the coin.[4] Development means better behavior, better leaders, and better role models. In fact, Sherpa says that “when development is done right, people pass it on.”[5] Therefore, when chief executives capitalize on development, it affects their company from top to bottom: they’ll have a better culture and a better organization.[6]

Consider that some executives work as much as 100 hours a week[7]. Add to that the pressure of shareholders, employees, customers, media, suppliers, competitors, and global markets; it’s more than one person can handle alone. Also, a recent corporate wellness survey by Apollo Life reveals that chief executives are burning out in record numbers. Why? Well, 28% have headaches, 23% struggle with insomnia, 38% have back troubles, 25% have allergies, and 53% have ulcers; and that is not the end of the health struggles.[8] So, think about it. If a company has reached a plateau and the CEO is maxed out, where is there to go? Development and growth, then, are critical to the health and wellness of a business owner and the business.

Management consulting and coaching are key constructs in the area of development. In fact, in the recent Sherpa survey, it is reported that executive coaching is so powerful and effective, companies are not measuring its ROI; they are measuring its IOB – impact on business as a whole.

So, we know executive development is valuable, but what does development do for the CEO? It all comes down to reflection, truth, change, and strategies. For example, a management consultant[9]:

  • Allows leaders to reflect about business decisions and about themselves
  • Brings reality – truth – front and center
  • Helps executives find replacements for behaviors that aren’t working
  • Offers advice and solutions for success

When selecting a consultant, it’s important to note that the industry does not provide a united front.[10] Not all consultants are qualified or certified. According to Sherpa, the most beneficial background for a coach or consultant includes the following (out of 100%):

  1. 50% business or consulting experience
  2. 35% training and certification as a coach
  3. 10% training as a coach
  4. 6% industry-related experience
  5. 4% experience as a therapist or counselor

The data is conclusive. For chief executives today, seeking out personal development through a management consultant is rising to the top of the list in importance. It even beats money!

Works Cited
Apollo Life. (2010). Corporate Wellness, CEO Health and Wellness Survey.

Burson-Marsteller. (2005). Who Wants to be a CEO? Understanding CEO Capital.

CMA Management. (November 2001). What’s happening to CEOs? Today’s hectic business climate is demanding a high price at the top levels of corporate life.

Lavine, T. (March 22, 2011). Why Lonely CEOs Need Executive Coaches.

Sherpa Coaching. (2011). 2011 Sherpa Executive Coaching Survey. Cincinnati, Ohio: Sherpa Leadership Institute.

[1] What’s happening to CEOs? Today’s hectic business climate is demanding a high price at the top levels of corporate life. CMA Management, Nov, 2001. Why Lonely CEOs Need Executive Coaches, Terry Lavine, March 22, 2011.
[2] Sherpa Coaching, 2011 Sherpa Executive Coaching Survey, Sherpa Leadership Institute, p. 2
[3] Sherpa Coaching, 2011 Sherpa Executive Coaching Survey, Sherpa Leadership Institute, p. 2
[4] Sherpa Coaching, 2011 Sherpa Executive Coaching Survey, Sherpa Leadership Institute, p. 4
[5] Sherpa Coaching, 2011 Sherpa Executive Coaching Survey, Sherpa Leadership Institute, p. 4
[6] Sherpa Coaching, 2011 Sherpa Executive Coaching Survey, Sherpa Leadership Institute, p. 4
[7] Who Wants to Be a CEO? Understanding CEO Capital, Burson-Marsteller 2005; Why Lonely CEOs Need Executive Coaches, Terry Lavine, March 22, 2011.
[8] Corporate Wellness, CEO Health and Wellness Survey, Apollo Life, 2010
[9] Sherpa Coaching, 2011 Sherpa Executive Coaching Survey, Sherpa Leadereship Institute, p. 9
[10] Sherpa Coaching, 2011 Sherpa Executive Coaching Survey, Sherpa Leadereship Institute, p. 7

Filed Under: Management Consulting

Do you live to work or work to live?

November 10, 2011 By

For business owners and CEOs, the “good life” is not stumbled upon, it is created.

Who is the sanest CEO in America today?  According to Inc. Magazine, it’s Pete Wakeman of Great Harvest Bread Co.  Just what is it that makes Pete Wakeman and his wife Laura the model of life-balance?  Handrails – physical handrails.  But before we talk about what Pete and Laura’s physical handrails are, let’s talk about the root of the issues.  That issue is that entrepreneurs today crave life-balance; a life outside of work: time to work out, time with family, time for relationships, and time for hobbies…time for something outside of work.

Business owners, CEOs and members of the c-suite crave balance for the simple reason that competitive pressure is on the rise.  In a flight or fight type of response, the first priority for most of them is to simply survive the job, if they can.  A recent IBM study has introduced the term: complexity.  Complexity relates to a faster pace of business, faster decision-making, higher possibility of failure, and global competition.  For the business owner or top executive complexity translates to job insecurity.  In fact, between 1999 and 2011, the average tenure of CEOs declined from ten years to about seven; and 40 percent of new CEOs last an average of less than two years.

With so much pressure, it is easy to see why many business owners opt to become workaholics in an attempt to preserve their company and their position.  In essence, they live to work.  But, the real outcome of overworking is not in success; the outcome is an unbalanced life that leads to exorbitant amounts of stress and serious health issues.  We’re not talking about a few extra cold and flu days.  These health issues include higher risks for high blood pressure, diabetes, high cholesterol and heart problems.

Workaholism and a lack of life-balance not only negatively impact the entrepreneurial spirit of the business owner or executive, it actually works against them.  Past neuroscience tests suggest that high levels of stress actually may impair decision-making.  So, rather than preserving the company or their position, many well-meaning business men and women are, in reality, destroying themselves and their work right along with it.
In a LeaderSource survey of CEOs, 92 percent revealed that finding a measure of work/life balance was the single toughest challenge they faced.  Forty-four percent complained that they had too little time at home, too much time spent at work, and too little time for leisure and relaxation.  So, what is the answer?  Well, now is the time to talk about those physical handrails.

Pete and Laura Wakeman made a few very important choices in their early days of their business when they were only one retail store.  They determined to make a few rules for which no exception would suffice; and they followed them like a religion.  Pete said, “One was the two-day weekend.  We never violated that, no matter what – it was a line we were afraid to cross, as though lightning would strike us down if we did…We didn’t talk about work at home; that was a rule.  That’s especially important.  When we left the bakery, we were gone until we came back…But the biggest handrail of all was what we used to call our ‘three-week trips.’  Sometimes longer than three weeks but never less; we never skipped them.  Later, as the business got more intense, it was easy to get confused and begin to think the trips were to refresh us so that we could work better.  We fought that thought like the poison that it is.  The trips were, are, their own justification.”

Think of the all the movies where a marriage falls apart, a child’s heart is broken, a friendship is sacrificed, and even a love of some simple hobby is set aside for the pursuit of work.  Hook, The Devil Wears Prada and others come to mind.  So let’s place Pete’s words into another context: ask yourself, “Do I live to work, or work to live?”

It is certain that Pete and Laura Wakeman work to live.  What they do for work does not define who they are or their life.  What they value more is the life they have and their work supports the loves they have developed outside of it.  Pete and Laura, even though they own their company, still use timecards.  They choose how many hours they will work and then as they punch in and out, their time adds up.  Pete says, “I know when I’m working and when I’m not…

“You can see that what works for us now with a 100-plus-bakery franchise is what worked for us with a single retail store; simple, physical handrails.  Handrails that we set then follow without further questioning.  All the good systems, all the good habits, derive from this simple act of partitioning.”  Pete also acknowledges that “It’s not uncommon for people to want to believe they are trapped…but we never make our company impossible to leave.”

The Wakemans trust their employees to solve problems even if it is not exactly the way they would do it.  Their employees know their handrails and have been empowered to run things while the bosses are out.  They also encourage the same lifestyle for their employees, who often take leaves of absences to live.  They hire only people like themselves, “with strong personal loves as important as their work.”

Perhaps it can’t be said any better than this.  Pete says, “Because we have always cared so much about having fun and being nice people, I think we would have achieved that in our lives no matter what we did, whether we had been businesspeople or not.  The business didn’t really give us that – we gave that to the business.  But what the business has given us in return is more excitement, even adventure, and much more constant growth and change than we could have had otherwise.”

So, the true handrails that the Wakemans have set are those that ensure that whether their business succeeds or fails, they will not have lost themselves.  They work to live!  And not unexpectedly, when they keep their life in balance, their business not only lives, it thrives as well.

Read more:  http://www.inc.com/magazine/20010201/21829.html

Sources:
Capitalizing on Complexity: Insights from the Global Chief Executive Officer Study, Executive Summary for the United States, IBM, 2010.

Resolving the CEOs Dilemma, Bain Brief, 10/09/09. The New Year Begins with 96 CEO Departures, Challenger, Gray & Christmas, 2 February 2011.

Corporate Wellness, CEO Health and Wellness Survey, Apollo Life, 2010.

Rick Nauert, Ph. D., Senior News Editor, Stress May Impair Decision-making, Nov. 21, 2008.

The Executive Balancing Act, Kevin Cashman, Forbes.com, 10/18/06.

Filed Under: Management Consulting, Work/Life Balance

Is HCM the key to success?

November 2, 2011 By

The modern world is looking at employees in a whole new way

In a world where technology is out of date the moment it’s created, software terms are not far behind.  For example, in the past, employees were considered a resource; an asset that companies utilized to provide the services and labor to meet the needs of the consumer; hence, perhaps the naming of the “human resource department.”

Today, however, a never-ending stream of data and statistics has proven that employees are far more than a resource.  Employees today are more than a set of hands; they are an asset full of on-the-job knowledge, colored with a dash of company culture, and sculpted by time and priceless experience.  In fact, employees’ power to make or break companies has turned them into a living, breathing chunk of capital: Human Capital.  Therefore, companies are no longer managing resources, they are managing capital.

A company might ask, “Is it possible to manage human capital according to the same old human resource standards?”  According to the Human Capital Theory, human capital is a company’s most valuable commodity.  Therefore, coordinating human capital is essential; when people work together their output is greater than what they can produce individually.

One way to expand the power, efficiency, and production capacity of human capital is to invest in them through training.  Leading-edge companies train 86% of their workforce.  As well, “Investing in employees’ future is more important than immediate compensation,” says Eric Rolfe Greenberg, director of management studies for the American Management Association (AMA).  Therefore, training increases employee morale and engagement – and a company’s bottom line.  Organizations that invest more in workplace learning yield:

  • Higher net sales per employee
  • Higher gross profits per employee
  • Higher market-to-book values

This is the function of the HR department, to find, establish and maintain high quality workers, high company morale, and to create a creative, knowledgeable workforce.

Yet, another critical area to address is enterprise resource planning.  Or should we say, human capital planning?  Traditionally, ERP software has been viewed as an operational and transaction system.  However, with ERP vendors and systems extending well beyond managing financials and materials, ERP is now a critical tool for managing that most important capital – human capital.  In fact, today’s ERP systems are growing far beyond tracking cost of labor, production hours, time and attendance and so forth.

Several ERP software giants are producing software and upgrading systems; and they have a new name for these systems – HCM, Human Capital Management systems.  Several companies tout these new HCM systems, including Oracle’s HRMS and PeopleSoft HCM, Workday’s HCM, and others including SAP ERP HCM.  An HCM ERP module enables businesses to manage all activities associated with their human resources or employees.  Some general functionality that many HCM ERP modules provide is:

  • Employee evaluations
  • Performance reviews
  • Employee leaves
  • Attendance
  • Benefits
  • Employee profit sharing
  • Employment equity
  • Group insurance
  • Employee compensation
  • Employee assignment tracking
  • Employee promotions
  • Employee retirement tracking
  • Employee training
  • Employee vacation tracking
  • Employee equipment tracking (lap tops, phones, cars)

The world today is looking at employees in a whole new way.  It’s time for companies to do the same.  Employees are no longer merely a resource; they are a critical company asset.

Sources:

All about the Human Capital Management ERP Module, ERP Modules, ERP.com, 3/24/11, http://www.erp.com/section-layout/337-erp-software/9472-all-about-the-human-capital-management-erp-module.html

Business Know How, Gregory Smith, Training and Development Leads to Higher Retention, Accessed April 2011, http://www.businessknowhow.com/manage/higherprod.htm

ERP’s Impact on Human Resources: People are the Key to Top Performance, Benchmark, Aberdeen-Group, 9/1/11, http://www.aberdeen.com/Aberdeen-Library/7270/RA-enterprise-resource-planning.aspx

The Human Capital Theory: The Most Important Lesson in Business, Task.fm, 9/7/11, http://task.fm/2011/09/human-capital-theory-the-most-important-lesson-in-business/

New or Outdated?? Ajit Yadav, technolism.com, 10/3/10, http://www.technolism.com/new-or-outdated-how-fast-the-latest-technology-becomes-old-in-todays-world.html

Filed Under: ERP Implementation, HR

Drive, Misapplied Doesn’t Get You Anywhere…

October 24, 2011 By

Combining the wits of Covey, Pareto, Williams and Hamming turns drive into history-making effort!

I was helping a client recently with an internal systems development strategy. Like most tech companies, there were many more enhancements on the “to do” list than money, developers, and time to get the enhancements done. The discussion inevitably led to a conversation about the process of prioritization.

Prioritization is a single process that takes place within the complex multicellular-organism of time management. If it’s only one process among many, why is it then that it’s so hard to do?

To help my client understand, I recalled a metaphorical device that I often use to focus the mind on what’s really important. Not unusual for me, the device I chose was Ted William’s Science of Hitting. Why? Well, Williams was known as a great hitter – arguably, the best of all time – and equally great at knowing “the strike zone” and his capabilities within it.

Ted Williams created a system to determine which pitches would allow him to get the best hit. Invariably, he learned that he hit a higher batting percentage on the pitches that crossed the plate in the right areas – his sweet spot. What does that mean? Well, he knew which pitches were worth swinging at. He didn’t just go up to the plate and swing at everything; he prioritized his decision-making and put his effort into the pitches that would help him make history.

I use this example to illustrate why it’s so important to crystallize thought, efforts and drive into what matters; what we are good at, what we want to sell, and what will yield the greatest customer satisfaction. In the business world, when we stray too far from top priorities – our sweet spot – performance declines, costs increase and customers may feel they are not getting the service they desire.

Another way to look at priorities is to look at the philosophies of Covey, Pareto and Hamming. In an article by T.E. Walker Jr., the commonalities of these philosophies on prioritization are combined, yielding a more comprehensive and understandable set of guides.

  • Covey focuses on 4 quadrants to show how focusing on the important matters in life that are non-urgent (first things first) help us take care of the things that really matter rather than the things that are merely urgent, but not important
  • Pareto instructs us that focusing on everything will not return the desired progress; rather, he suggests focusing on the smallest area available that has the most impact and yields the greatest return on our efforts. Or in other words, “The few most potent things wield disproportionate influence, so act accordingly,” Walkers says.
  • Hamming says, “The steady application of effort with a bit more work, intelligently applied, makes all the difference.” Therefore, two people focusing on the same things with the same level of drive will achieve the same; but if one spends a little extra time, the results will double his capacity.

Summary: To prioritize successfully, people and companies must focus first on those things of greatest importance in the areas that will give them the greatest return on their effort, and they should spend a little extra time doing them. By so doing, success can be doubled and the likelihood of driving the metaphorical baseball out of the park has been drastically increased.

Read more: What I’ve Learned So Far, T.E. Walker Jr., tewalkerjr.com, 12/2/07,

Filed Under: Management Consulting, Westchester Partners

The Top 2 Reasons Companies Fail to Implement ERP

October 15, 2011 By

The 1 thing that may make the difference between success and failure

Implementing Enterprise Resource Planning (ERP) is a lot like bowling.  With the right training, sophisticated equipment and proper aim, any company should be able to clear-the-lane.  However, many companies struggle to simplify and streamline processes.  The variability in knowledge and technique leaves many critical pins standing.  A recent LinkedIn survey reported that budget write-offs for failed ERP Implementations “were typically in the range of tens-of-millions” and many CIOs even lost their job4.

Large IT projects, like ERP, often fall short of expectations.  In fact, in a recent report by the Standish Group, only 32% of IT projects are completed within scope, cost and time.  Forty-four percent (44%) of projects were late, over budget or did not have required functionality5.  Twenty-four percent (24%) of projects were cancelled prior to completion5.  Research from Oxford University also reveals that 93% of IT projects fail to some extent: 60% fail in some measure and 33% fail catastrophically6.

IT projects are critical to business survival, yet such failures become costly write-offs of financial and human capital.  Several articles and reports agree on a list of reasons why ERP implementations often end up in the gutter.  Among the top reasons are1&2:

1) Selecting the wrong ERP Software System (unsuitable to company needs)

2) System failures due to incorrectly selecting an ERP consultant

Dr. Edward F. Knab says, “Most organizations are ill equipped to select the most appropriate ERP solution, the task is daunting and if not given the appropriate attention can expose the organization to a significant risk. There is an almost infinite number of horror stories associated with the selection and implementation of ERP software; most organizations only go through this process once every 15 years and therefore have little or no experience in maximizing the effectiveness the process.”3

Selecting software depends upon its features and business applicability to a particular company.  However, above and beyond selecting a system; the most critical step in successful ERP implementation is finding the right ERP partner.  An ERP consultant has a level of knowledge and expertise that is essential in fully utilizing ERP to its fullest potential within an organization.

Dr. Knab also said, “There are two major reasons why organizations find the process of selecting the proper ERP solution such a difficult challenge. The first has to do with the knowledge base within the organization. Unfortunately, organizations (and people) only “know what they know”; meaning, that [they] are limited by [their] own experience and are only able to evaluate ERP software within the context of [their] own collective experience which may be too limited maximize the benefits of this important decision.”3

Put simply, selecting the wrong ERP partner can be the gutter-ball, the failed spare, which keeps companies from knocking down all the critical ERP necessities.  The result is poor performance, severe budget write-offs and for many CIOs, their job.  Conversely, the right ERP consultant can guide and coach companies through ERP transitions to avoid the following mistakes1:

  • Lacking a solid implementation plan
  • Failing to provide adequate training to employees on the ERP
  • Failing to test the ERP system prior to full operation
  • Failing to evaluate the system
  • Lacking a long-term maintenance strategy

Consultation and coaching are crucial to ERP change management and company success.  In fact, they are so important to business success that it is estimated that over 60% of Fortune 500 companies’ CEOs utilize coaching.  Therefore, for many companies, finding the right ERP partner may be the one thing that makes the difference between success and failure.


Sources:

1) How To Avoid ERP Implementation Failure, eHow, http://www.ehow.com/how_6827880_avoid-erp-implementation-failure.html

2) The Reasons Why ERP Projects Fail, Dora Diamond, 11/19/10, http://www.ehow.com/list_7368329_reasons-erp-projects-fail.html

3) The Science of Selecting the Proper ERP Solution, Dr. Edward F. Knab, 9/19/11, http://www.edwardknab.com/

4) Is Your ERP Implementation in Trouble? Sue Bergamo, CIO Update, 2/1/10, http://www.cioupdate.com/insights/article.php/3862056/Is-Your-ERP-Implementation-in-Trouble.htm

5) Nate Prince, Project Failure, Standish Group, November 2010

6) Studies Show IT Projects Experience High Failure Rates, Wiley, July 2010

Filed Under: ERP Implementation

Surviving the Cloud

September 26, 2011 By

When we think of clouds we think of wispy puffs high up in a blue sky or soggy gray sponges showering down gloom. However, in today’s increasingly web-based business world, the gloom might be more applicable; especially when ERP and cloud computing are mentioned in the same sentence.

Recent online commentary suggests that cloud computing will do much more than rain on large enterprise computing companies; in fact, the forecast calls for severe calamity. ERP giants like Computer Associates (CA), Hewlett-Packard (HP), Oracle and Dell claim to have cloud strategies, but will these strategies help them avoid disaster?

Dana Blankenhorn, in a recent post on Seeking Alpha says, “These companies may work hard to get out of the way of the cloud, and they all have cloud strategies, but their room to maneuver is limited. Generally the more money you’re making from pure hardware, the more you’re relying on enterprise software contracts, the more of your business is vulnerable, and the more vulnerable you are, to the cloud.”

So the question becomes, “Will the ERP industry integrate the cloud successfully, or will cloud technology render giants, like Oracle, helpless?”

So far, Oracle CEO Larry Ellison has redefined the cloud with his company’s “cloud in a box” definition. However, according to Charles Babcock of InformationWeek, “The only problem with this dichotomy is that few implementers of cloud computing agree with [Ellison’s definition].” Babcock goes on to say that, “The Oracle appliances, stacked with layers of Oracle software, bear little resemblance to Amazon EC2′s data centers…Amazon’s EC2 is the leader in cloud computing market share because it tells its customers to supply the software that will run on its machines. Customers [basically]…build their own workloads. With Oracle, even the version of Linux running on the appliance will be built by Oracle, not to mention the application, database, and middleware.”

How are other ERP related companies dealing with the cloud? Well, ERP consultants, who provide assessment, structure and guidance in maximizing ERP processes, should be able to easily circumvent the storm. The only requirement will be to educate themselves on cloud computing and integrate its values and benefits into their core competencies.

Sources: Who the Losers are in the Cloud? Seeking Alpha, August 3, 2011; Salesforce.com challenges Oracle CEOs Cloud Account, Charles Babcock, Informationweek.com, October 1, 2010

Filed Under: Cloud Computing, Westchester Partners

Westchester Partners Is Now Online

September 25, 2011 By

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Did you know that 70% of top companies take an integrated approach to enterprise resource planning (ERP)? Yet, industry statistics show that more than 60% of ERP implementation starts historically fail. What causes these pitfalls? Is true operational efficiency attainable? We believe it is.

Continuing our tradition of accelerating businesses, Westchester Partners is now online! Online interaction enables us to amplify the success and value we offer with weekly “injections of experience.” From research statistics, current news and our perspective on ERP issues, you will find it here. You can also follow us on LinkedIn, Facebook and Twitter.

Sources: News & Analysis, Aberdeen: 70% of Top Companies Use Integrated ERP for Orderto-Cash Cycle, May 11, 2007 // Published as a news service by HIS; The 12 Cardinal Sins of ERP Implementation, Richard G. Ligus is President of Rockford Consulting Group, Rockford Consulting Group, 2004

Filed Under: Westchester Partners