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Justifying a Software Selection Project in Our Current Economic State

Thursday, February 19th, 2009 by Alex Smith

As 2009 arrives, companies of various sizes contemplate the year ahead and consider their options for remaining both profitable and viable in a world of relative economic uncertainty. As such, business leaders are adjusting to the new economic challenges and market conditions. While all of this uncertainty will eventually stabilize, organizations must question what is next for them as a company and for their upcoming projects and applicable expenditures.

As has occurred throughout history, human nature evolves and the strong survive. Businesses are no different. Virtually every industry or sector has evolved in some manner over the last few months. The world of information technology has experienced its own transformation. Technology-based purchases are still occurring and companies are initiating new projects. The difference is the nature of the project and the decision making process surrounding the acquisition of the products or services purchased.

ERP software is, without question, a major endeavor for any organization. While a significant amount of work goes into both the selection and implementation of a new business software system, it does so with the ultimate promise of providing significant tangible and intangible benefits to the organization. ERP software can help transform an organization by eliminating internal weaknesses and by producing a roadmap for leaner, more efficient, and more profitable operations. It can be the saving grace for a struggling company, and it can help provide a solid foundation for a profitable tomorrow.

To achieve the project success and the promises ERP software offers, the ERP selection process needs to be tightly managed and executed in a very systematic manner. Now more than ever, the purchase needs to be based on known pain points or organizational weaknesses. The purchase needs to help solidify the organization’s future. The resulting purchase needs to allow for tangible benefits and a measurable return on investment. The purchase needs to be justifiable for both the selection team and the organization’s leadership.

While this may seem like a pipe dream to some, concrete return on investment is completely feasible when the right ERP software is purchased and implemented. From inventory reductions and improved order fill rates to more efficient back-office processing, ERP software can significantly improve an organization’s bottom line and overall profitability. ERP software can provide a genuine return on investment through lower inventory carrying costs, reductions in overtime hours, and more efficient production lines.

While these are only a few areas of ROI, they are realistic expectations when implementing a solid ERP solution. These benefits can provide a relatively fast payback, and they represent the means to justify the purchase that brings along with it a number of additional intangible benefits such as visibility to data, improved customer service, and an increase in overall customer satisfaction. Intangible benefits aside, in uncertain times, any major expenditure needs to be backed by measurable results.

If 2009 brings the promise of change, an ERP software purchase can help provide the catalyst for that transformation. It can provide the backbone for an organization’s future by offering a path to a more efficient operational flow and a more productive workforce in the months and years to come. It can be a justifiable purchase with solid return and measurable payback.