Insights

There Are Hidden Costs to Selecting a New ERP, Just Like a Wedding

So you’re selecting a new ERP, congratulations! When is your big day (read: targeted go-live)? Mine is in the fall. No matter where you are in the ERP selection process, I’m sure you’ve already encountered some hidden costs. These expenses are not unlike the things that went unplanned for in the first draft of my wedding budget.

Here are five to keep in mind:

  1. Configurations —Wedding dresses are made for brides with varying body types and style preferences and alterations are often a must to achieve a custom fit. Similarly, ERP systems are designed to handle a broad set of requirements across multiple industries. Your ERP may not “fit” perfectly out of the box given the size or complexity of your organization. Configurations may be necessary to meet the needs of your business including language, currencies, time zones and more but will come with a price.
  2. Licenses—Children are not complimentary wedding attendees did you know that? Non-core, non-super users are also not free to use your new system. Identify those who require access to the new system and further define their rights based on their role within the organization. When calculating your total cost of ownership, don’t forget to factor in licenses for business users who may not be involved in day to day transactions processing but rather are active in enterprise-wide processes like the annual budget or performance reviews.
  3. Consultants—The key to wedding planning success is outsourcing. That being said, I hired a wedding planner to negotiate supplier contracts, help design the reception, and manage RSVPs. And while I am getting primped by a professional glam-squad the day of the wedding, you can leave the tasks of gathering detailed requirements, setting an implementation strategy and managing the project to the professionals. Further, hiring consultants will ensure your best interests are represented in discussions with vendors and minimize the disruption to your day to day operations.
  4. Change management costs—Wouldn’t it be nice for all of your out of town guests to arrive at their hotels with a welcome bag brimming with your favorite local snacks? I would liken these carefully curated treats to change management costs. To start, develop a communications plan to make stakeholders aware of decisions made or milestones reached. During implementation and beyond, make sure practitioners are receiving the appropriate support to perform their jobs. Engaging users throughout this exciting time in your company’s life is a small investment toward building organizational consensus and making them feel at home with the new system.

My last hidden cost is actually not a cost at all, it’s a discount.

  1. Hidden discounts—My parents work within the Johns Hopkins system which entitles me to a reduced rate at any campus wedding venue. Although a slight amount, it is real money in my pocket at the end of the day. Don’t be afraid to ask a vendor for their best and final offer- this indicates that no further negotiation on the amount or terms is possible. Also inquire about any discounts the vendors offer.

If you can proactively anticipate the costs above associated with selecting your ERP (or planning your wedding), you can be assured that your money is spent within budget and where it provides the most value to you.

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