A recent survey of 139 IT executive in the U.S. and Canada conducted by research and advisory firm Computer Economics during November 2009 shows that 52% of IT organizations expect to increase their IT operational budget in 2010 by launching new projects. Only 16% plan to make further budget cuts in the year ahead.

This survey (see the Computer Economics Survey summary here), along with reports from news and opinion from other sources, seem to indicate that 2010 could result in a turnaround for IT spending from the depths of 2009.

RJMC’s recent experience is that software vendors and service providers are offering significant incentives to motivate buyers to close deals. If your company has been considering a change to your enterprise technology and you need to continue to hold the line on your IT spending, then 2010 might be the right time to minimize your cost while maximizing your benefit.

Let RJMC assist you in selecting the right solutions at the right price. Call us at (310) 445 – 5300 to learn how RJMC can help you.

RJMC led PFF, a public company, through an ERP Evaluation and Selection process that covered the bank’s Finance, Accounting, and Human Resources functions and later provided Project Management services during the software implementation.

This Referral Fee Program is structured to provide compensation at several levels, including fees for phone or in-person introductory meetings, fees at the point that a new RJMC consulting servcies engagement is initiated, and fees over the life of the resulting client relationship.

The scope of RJMC consulting services include assisting companies in assessing their existing Enterprise Resource Planning (ERP) technology, evaluating and selecting new ERP solutions, ERP implementation project management services, and other Information Technology and Operations Management-related consulting opportunities.

Interested parties should contact us at (310) 445 – 5300 to learn more about how to qualify for the 2010 RJMC Referral Program.

Please note, system technology and integration firms are not eligible to participate in the 2010 RJMC Referral Program.

1. Define your business needs by sitting down with all of the business areas that will be affected by the new system. Your business requirements need to be defined prior to starting the software selection process.
2. Establish a realistic budget for the project so that you can pre-qualify vendor solutions that should be evaluated.  Check out the RJMC ERP Calculator to help you determine your budget.
3. With the needs of stakeholders in mind, determine what features and functions you need as opposed to those that you want.
4. Don’t let your people get locked in to the way they do their jobs today. Prepare your staff to evaluate based on how the new software could work for them, rather than how it differs from today’s procedures.
5. Secure upper management buy-in before you start the selection project. Without this buy-in, your project will stall.
6. Ensure that your selection project has a Beginning, Middle, and an End. Your project team needs to know where the project is headed and how long it will take to get there.
7. Evaluate the system integrators that will be responsible for making the software work for your company. A selection process that results in the “right” software must also be implemented by the “right” system integrator. A very important secret to success!

Invite RJMC in to work with your company to take maximum advantage of the RJMC expertise that led to the Seven Secrets of Successful System Selections.

As larger software providers continue to gobble up smaller firms, it is more important than ever to have an informed perspective on what these large solutions offer as compared to the value that smaller but often-times no less robust packages can provide to your business. RJMC will help you match your business needs with these offerings – the key to success in any selection project!

Call us to learn more at (310) 445 -5300.

We used to think that evaluating and selecting the “right” enterprise system was the key to success. Well think again! After much industry consolidation, today’s options are dominated by Epicor, Infor, Lawson, Oracle, SAP, Sage, and Microsoft Dynamics solutions with a good number of Best of Breed industry-specific choices sprinkled in for consideration. The good news is that although fewer choices remain, the software products themselves offer a robust features and functions often packaged as a suite.

A Key Question - So if there are fewer alternative choices and you do a good job of matching your key requirements to the features and functions offered by the available software solutions, don’t you have a high probability of a successful implementation?

The logical response is “yes,” but experience says otherwise. In today’s market, selecting the “right” software does not guarantee a successful implementation. Why? Because with the level of sophistication of all these products, whether they be a Tier 1 or Tier 2 solution, there is a significant level of complexity to properly configure and test the solution before going live – not to mention the challenge of training existing user in the proper use of the new system. In addition, in almost all cases, putting in a new system today requires rethinking your existing business processes.

So where do you go for that guarantee, that warm and fuzzy feeling that your implementation will be successful and finish close to your budget? Much of the answer rests within the composition of your internal project team. Another key success factor is the competencies of the System Integrator that you engage to train your team and design, configure, and test the system.

How Do You Select the Right System Integrator?
Many years of experience in working with a broad scope of System Integrators has lead to the conclusion that some Integrators are better than others. This is probably not a surprise.

While none of the tips below are infallible, there are ways to lessen your chances of choosing a poor partner for implementation.

Here are 10 simple and effective guidelines to assist in selecting the “right” System Integrator for your project:

TIP #1:  Select an Experienced Implementation Team

Regardless of the name of the firm on the business card, the bottom-line is to assess the experience and skills of the specific individuals that comprise the proposed Project Team and make sure that each of the functional areas to be addressed has a functional expert assigned to the Team. The more important a functional area is to your business, the more important it is that you trust the team member responsible for this area.

It is also important to know that some of the key individual members of the System Integrators team have worked together in the past. Effective communication is a key to success and sometimes the functional consultants are recruited just for your project and may be meeting their team mates for the first time. This can be a warning of problems ahead.

Incorporate added protection by negotiating the option to change team players if one or more is jeopardizing the success of your implementation.

TIP #2:  Validate the Project Scope and Approach before Project Kick-Off

Make sure that the selected System Integrator has provided you with a detailed Statement of Work document that clearly describes the scope of work to be performed, identifies all assumptions or exclusions, delineates responsibilities, and clearly explains proposed fees.

A System Integrator that chooses to be vague is taking that approach for its own benefit, not yours. If the system integration firm refuses to provide an adequate level of detail to support the planned implementation activities, look elsewhere. This is not the time to simply trust a vendor.

TIP #3:  Look for Relevant Industry Expertise

You looked for a system that can address the unique features and functions for your industry. Make sure that the selected System Integrator brings a similar familiarity and relevant references to the project. You don’t want to encounter a situation where the assigned functional consultants do not understand the unique requirements that are mandated within your industry. The design and configuration stage of the implementation is not the time for the external implementation team to learn all the nuances of your industry.

TIP #4:  Can They Actually Do System Integration?

More often than not, you are implementing a new enterprise solution that will require integration to other in-house developed or third-party solutions. Does your System Integrator bring with it the technical resources to accomplish the required level of integration?

When a System Integrator looks to your internal team to develop the required interfaces into the new system it may be a signal to consider other options. You may be asked to participate in the integration process, but a good implementation partner will have the necessary technical resources to accomplish the required integration. They may even offer the use of less costly off-shore resources to effectively manage integration costs.

TIP #5:  Is Data Conversion Too Much to Ask?

No implementation can progress successfully without converting existing data into the new system. Both static and dynamic files require planning and mapping from legacy systems to the new database. The selected System Integrator must bring the tools and expertise to successfully convert required data files.

It is difficult to convert historical transactional data, but when it comes to routine master file data, your partner should provide you with a process to efficiently map the old formats to the new.  One of the primary causes of implementation project delays and budget overruns is the inability to convert and validate data.  Pick a System Integrator that can work with you to make data conversion as easy as possible.

TIP #6:  Can the System Integrator Introduce Business Process Improvements?

Remember that you are implementing a new system. Don’t settle for a System Integrator that supports the status quo.  A system is not just the hardware and software but also encompasses your defined organizational responsibilities and supporting business processes.  A good System Integrator will understand the best practices built into the software and possess the depth of experience to introduce alternative work flow or business process methodologies within the scope of the work being performed.

TIP #7:  Does your System Integrator Choose to Plan or Plan to React?

Look for a System Integrator that promotes a methodology that will provide a reasonable level of comfort that the project will be performed on-time and within budget.  You wouldn’t hire an a firm to build a house without blueprints, right?  Don’t hire a System Integrator that can’t describe the methodology that they will be using to build your system and bring you and your staff to a successful “Go-Live” status.

TIP #8:  Not All System Integrators are Equal, Look for Value-Add

With experience, you get System Integrators that can provide libraries of tools (programmed routines, utilities, reports, etc.) that they can utilize to simplify and streamline the implementation process. These are Value-Add features that should not go unnoticed.

Similarly, look for a System Integrator that has a strong relationship with the software solution provider. In cases where extra leverage is needed to resolve unanticipated software problems, these firms command priority status. There is tremendous value in such a relationship.

TIP #9:  Know the Cost Before You Start

Everyone knows how costly an implementation project can be. That is why we are all so intrigued when we learn of a major system disaster that resulted in huge budget overruns. Will your System Integrator mitigate your risk of being one of those stories?

Look for a System Integrator that is willing to share some of the risk by incorporating a fixed fee arrangement on portions of the project or fixed billing rates for the duration of the project assuming the project scope remains constant. Are they flexible about limiting out-of-pocket expenses? If you have a sense that the System Integrator is inflexible when it comes to pricing, this may be a signal to look elsewhere.

TIP #10:  Communication is Key!

Successful implementations are all about effective communications at a variety of internal and external levels.  The System Integrator and their functional consultants will be interfacing with your management and staff on a daily basis.  Look for a System Integrator that demonstrates their ability to communicate as evidenced by the manner in which they schedule meetings, present their Project Team and their proposal materials, and respond to open issues.

Answer: This question comes from Rich in Los Angeles. Thanks, Rich, for your question.

First, some definitions. A hosted Enterprise Resource Planning (ERP) system means that the system’s software physically resides on servers that are outside of your company’s physical infrastructure. Hosting also typically means that an outside party is managing and maintaining the database and code on which the ERP system runs. The more traditional method for setting up and managing an ERP system has always been to manage the system with company employees maintaining servers that reside within the company’s headquarters or other locations.

Hosting an ERP system provides some line-item cost savings by requiring little or no “on premise” hardware and by reducing the staff necessary to maintain both the hardware and the software. The hosting service, though, adds a new cost to the IT budget – and this cost can be substantial. In addition, this cost never goes away.

The persistence of the monthly hosting charge means that in the course of the first three years or so, a company that is hosting its ERP system has spent more for hosting than it would have laid out for a hardware purchase. This all by itself does not indicate whether hosting was a good or bad decision, however. The company has, after all, been saving on its staffing costs all of that time.

In addition to cost savings – or additional costs incurred – with hosting, there is the concern of whether managing an ERP system is the type of skill that this company wants to build and nurture while spending money recruiting, hiring, training the staff necessary to manage the system. If the company is a manufacturer, couldn’t these IT dollars be more wisely spent on IT staff who specialize in productivity-enhancing software tools for the shop floor or managing product design and lifecycle systems for the company’s critical engineering function? In other words, if large-system IT management is not a core competency, then why not let an outside expert do the job?

RJMC finds that companies with a lean IT staff often find hosting to be a solid option. This allows the company to maintain its focus on its core functions and its competitors, without worrying about whether the back-end system is up and running.

Companies with a large existing IT infrastructure are less likely to find the higher long-term costs of hosting to be an acceptable trade-off. These companies have the resources to recruit and train adequate resources to support an on-premise system and will not want to give up the agility that this sort of in-house skill can provide.

RJMC was engaged by the Universal Music Group to support several projects from the evaluation and selection of new financial systems to an assessment and review of their cooperative advertising programs. RJMC also participated in the development of custom software to support Commitment Tracking and Royalty Reporting.

RJMC was engaged to document the business processes supporting Worldwide Product Fulfillment and the related post-production and management functions required to manufacture, deliver, and store materials sold to SPE customers and SPE itself. The process documentation prepared by RJMC was used to re-engineer business processes leading to the definition of future system requirements.

RJMC was selected from among a broad range of competing management consulting firms to define the system requirements for a new common, shared, Collection Information System that would support the 19 museums that comprised the Smithsonian.