We know from experience that companies don’t always really consider the importance of an ERP Partner’s experience working with other companies in their particular industry. Some companies may choose their ERP implementation vendors based on their size, or the number of overall implementations that they’ve done, but far fewer ask this critical question: “How many implementations have you done for companies in my industry?”
Why Is Industry Experience Important?
So why is this such an important question? The first reason is simple – there’s no substitute for actual experience. Choosing an ERP Partner with experience – not just with the software, but specifically with how to use it for your specific industry – will lead to a more rapid deployment, will be more cost effective, and will result in more efficient use of the ERP software. When an ERP Partner needs a day or more of paid “Discovery” to learn the intricacies of your specific industry, you’re basically paying to training them in your industry requirements. This can be avoided by choosing a Partner that has the right experience.
Secondly, a Partner with experience in your industry will also know where your industry is heading, because they’re already working with multiple customers in the same industry. This ensures that your system will be configured in way that will make it easy to incorporate expected changes. For example, this may include being aware of a changes in accounting standards for your industry, reporting standards changes, or changes being made by your vendors and customers on how data is transmitted. A good ERP Partner will be aware of these potential changes and configure things in way that puts in you a good position to handle the new requirements without major changes to your system.
Lastly, an ERP Partner with industry experience is more likely to provide long term value for your company. As your business grows, your system needs will change – that’s just a fact of life. A Partner with industry experience will be able to provide guidance – and even examples -from what they have seen other customers go through, as well as what worked and what didn’t. An experienced Partner will also be able to suggest relevant additional modules, 3rd party products, or training on existing solutions that may be helpful. But – you may ask – why would you need additional training on something that you’re already using?
Educating Customers on Unused ERP Features
The simple answer is that most companies don’t take advantage of all of the functionality at their disposal. One of the better studies that I’ve seen on this under-utilization of ERP was done a few years ago by Accenture. They interviewed over 300 CTO’s about their ERP systems. Here are a few key points from that study:
- On average, organizations only use 64% of their ERP functions.
- One-fifth of the study participants cited “lack of time to learn how to apply features” as their main reason for not using all functionality.
- 87% of respondents believe that spending on enterprise systems – including the use of newer technologies, like SaaS – will increase or remain steady in the future.
I pick out these points because I think they illustrate some of the areas where having an ERP Partner with experience in your industry helps. A good partner will work with your organization to get the most out of all the features in an ERP as well as directing you to the “best of breed” SaaS applications you might need to support growth. Your partner should be able to effectively communicate the features that may have not been implemented initially but you still own, as well as the importance of making time to train on useful features. I have definitely seen this lack of communication lead to organizations taking on ERP replacement projects simply because they didn’t know what they already had. That’s an expensive, wasteful exercise that anyone should want to avoid, if possible. A good, experienced partner should help organizations make these decisions, not just be there for the technical side of the ERP.
While it seems obvious, not all organizations take into account their ERP partners expertise in their industry. This is paramount to a successful implementation. In some cases you may even find an ERP partner in the same industry as your organization. At Tensoft, we are a SaaS software company providing solutions for other SaaS software providers. I use our software to run our business and have the same issues many of our customers have. Not only am I able to share my experiences with our customers on how I utilize our software, I often learn new, better ways to do things from our customers, based on their experiences.