ERP Statistics from Panorama Consulting

May 5, 2010
By djohnson
Bar Graph

Panorama Consulting recently published 2 statistics about ERP implementations that were worth repeating. The entire Panorama article, How Much Can You Afford to Lose With Your ERP Implementation is worth a read.

ERP Statistics from Panorama Consulting

Average annual cost for on-premise ERP: $6.2 million
- software licenses, hardware, services, and annual maintenance

Average benefits realization: 37.2%
- percent achievement of business case savings and efficiencies

Ideas from ERP Cloud News

The statistics above imply that an expected ROI of 269% in year 1 will actually result in a break even scenario. But using cloud technology, SaaS options, and setting realistic goals, you can easily lower your risk by reducing the initial expense prior to measuring your results.

Cloud ERP technology

Using the cloud will help you reduce costs associated with hardware as well as implementation costs. You can start with a small system to see if you can really generate the benefits before sinking money into a fully redundant architecture. Using a cloud provider, you can scale up and down quickly, so you may never have to invest in hardware.

Realistic goals

Automating 100% of your management, accounting, billing, reporting, and business processes may not make sense on day one. Automate the 80% of your business and then go back and build interfaces to the remaining 20% later. A great portion of the cost of ERP is often included in ERP customizations. Read more about minimizing ERP customization costs.

SaaS Options

Purchasing a SaaS solution which is run on a cloud infrastructure will help you gauge the success of your ERP deployment before you make a full investment. Most mid-size SaaS ERP implementations can be implemented with costs of $100,000 or less in year one, including software, services, and maintenance. With a minimal up-front expense, you can decide to continue using SaaS or move to a full fledged on-premise deployment.

Important: do not get locked into a SaaS solution, otherwise your “inexpensive trial” can turn into a permanent solution with higher and higher ongoing costs. Pick a vendor which offers both on-premise and SaaS options as well as several support options.

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