Aberdeen ERP TCO Midsize_July 2007

2 9708 179797 12719 all mid size companies 175 169

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Unformatted text preview: es the success of an ERP implementation is not only based on cost and time to implement, but also on the business benefits achieved through its use. In benchmarking ERP in Manufacturing, Aberdeen determined Best-inClass using the following metrics: • reduced levels of inventory • inventory accuracy • manufacturing schedule compliance • percent on-time and complete shipments • “Solutions have matured in the past 10 years, so we are hoping that we’ll find a solution that meets our needs. The software is more user-friendly, and we expect that the implementation will be more cost effective. Before, the maintenance of the software and all of the associated files was too expensive. Now ERP software is mature. It’s also cheaper, easier to install, and has less overall associated maintenance.” number of days needed to close a month In addition to the metrics used to determine Best-in-Class, the following improvements were measured: • reduction of manufacturing operational costs • reduction in administrative costs • improvement in manufacturing schedule compliance • improvement in complete and on-time shipments ~ Chief Technical Officer, mid-size industrial equipment manufacturer in the midst of ERP selection Therefore, for one final measure of TCO, Aberdeen calculated the cost of each percentage point of improvement gained from the deployment of ERP implementations of each of the six vendors (Table 7). Table 7: Cost of Performance Improvement by Vendor...
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