Measure More, Produce More

In the report “ERP: IS High ROI with Low TCO Possible?” from Aberdeen Group, total cost of ownership remains a significant factor that influences enterprise resource planning strategies and decisions.

As companies brace themselves in a down economy, ERP projects (upgrades, extensions, new implementations) run the risk of being delayed just when they are needed the most. A well-managed ERP implementation can be a continuing source of cost savings and operational improvements which help companies survive and thrive, according to Aberdeen research.

While the total cost of ERP ownership is important to monitor and optimize, focusing on TCO is no longer sufficient.

“Focus must now expand to include ROI of ERP projects in order to justify continued investment and maximum benefits,” says Cindy Jutras, VP, research fellow and group director, who was primary analyst of this report.

“Companies with ERP implementations that we determine to be ‘best in class’ don't necessarily pay more than poorer performing installations, but measure more and subsequently produce significantly more benefits in terms of cost savings and other improvements, driving the cost of those benefits down,” Jutras says.

This story has been reprinted with permission from Information Management.