Developing an Enterprise Software Strategy
The Problem and Opportunity
At most companies, operations management would admit that business software usage and integration of enterprise business processes could be improved. Key issues usually are:
- Can existing ERP software be improved or upgraded to meet current and projected needs?
- Are there enough deficiencies in current ERP functionality, technology, or vendor status to justify searching for new ERP software?
- Understanding the ERP strategy’s effects on the options and timing to improve satellite business applications expected to coordinate with ERP.
- Who's responsible for business software, department coordination, and change management?
Without the guidance of a well-crafted Enterprise Software Strategy, companies tend to react to problems and opportunities in a ‘business software vacuum’ which results in a business software environment that’s unnecessarily difficult and expensive to maintain. This often increases isolation and inefficiencies of business process areas across the enterprise. This plan is especially important as companies enter the green zone in the chart below.
Developing this Important Plan
Engleman Associates, Inc. offers a process to develop a realistic and defensible Enterprise Software Strategy. Our approach and skill is based on more than 900 ERP software projects conducted since 1996.
The Enterprise Software Strategy plan is designed to improve confidence on whether a company should improve existing ERP or implement new ERP, and when—for the greatest benefit to the company. The plan also contemplates major satellite business applications that may compliment ERP—hence the name 'Enterprise' Software Strategy planning.
The Enterprise Software Strategy Planning Process
Education: The following items are useful to discuss, and are intended to improve your team's ability to participate in, and appreciate the results of, the Enterprise Software Strategy planning exercise.
- Status of the current-market ERP and satellite business applications types that typically complement ERP.
- Attributes of a modernized business applications and the general benefits to companies.
- Techniques to reduce business software costs (licenses, maintenance, or subscriptions) which can affect the business application paths ultimately taken.
- Techniques to control software implementation projects to manage risk and achieve better results.
- Details on the Enterprise Software Strategy planning being conducted and requirements of team members.
Company Discovery: This involves the collection of specific information on status of strategic topics, affected business process areas and business units, enterprise business software and IT infrastructure.
- Big picture: This discovery is about the company from a big-picture or strategic level. This includes discussions of potential changes in your company size, acquisitions, new products, manufacturing techniques, distribution, international business, industry trends, or other major potential changes with your business.
- High-level for affected business process areas and Business Units: The business process area or business unit interview techniques are built to detect weaknesses and potential opportunities in business processes related to ERP and satellite business systems.
- Enterprise business application options and IT infrastructure status: This discovery seeks details about strengths and weaknesses of ERP options, satellite business applications, and overall IT infrastructure that supports business applications.
Discovery Build-out and Stabilization: Further develop and organize all company findings for potential use in the Enterprise Software Strategy. This includes findings from the big-picture/strategic interviews, business process interviews, business application/IT infrastructure discussions and other findings.
Strategic Goals: Confirm, develop, and unify business strategic goals for eventual tie to the Enterprise Software Strategy plan. The discovery in earlier steps of this planning defend existing or establish new company business strategies with which an Enterprise Software Strategy plan should align.
Enterprise Software Strategy: Develop strategy plan components and initial Enterprise Software Strategy Report. The reports sections are:
- Executive summary—highlight key opportunities and key recommendation with justifications.
- Methodology—summary of methods used to develop this important Enterprise Software Strategy.
- Current status of enterprise applications and IT infrastructure—strengths, weaknesses in the context of relevant improvement options.
- Strategic goals used to influence the Enterprise Software Strategy and eventually business application projects approved.
- Key improvement opportunities for enterprise business applications organized by (1) specific functionality, (2) enterprise-wide collaboration, (3) strategic concepts, and (4) IT infrastructure.
- Each key improvement opportunity is reviewed for how it may be achieved within the major ERP software improvement paths and as augmented by legitimate satellite business software options. For each improvement opportunity and for each major improvement path, an assessment of risk, cost, and benefits is made. The key improvement paths (or a subset of these paths that may be relevant) are:
- #1: Current ERP with low risk upgrades.
- #2: Current ERP with major upgrades.
This evaluation point is unnecessary if the current ERP is fully updated or updates remaining are low risk and low costs.
- #3: New ERP.
This evaluation point is typically unnecessary if the current company ERP is estimated to be in the ‘better ERP group’.
- Governance model and plan for enterprise business application improvement projects that are properly aligned with the Enterprise Software Strategy.
Governance Model: Further develop and confirm governance model to execute the Enterprise Software Strategy plan: The governance plan or model is intended for ERP and major satellite business software projects. This includes ongoing business software improvements that can more resemble a continuum and not a specific project. The governance model shows estimated personnel resources and duties of, or support needed from, various roles to better ensure the Enterprise Software Strategy plan can be effectively used in future business software projects.
Enterprise Software Strategy Plan Validation Workshop: This workshop is intended to 1) confirm that the Enterprise Software Strategy developed in prior steps is meeting expectations and 2) tune how it should be communicated to the larger company team that needs to approve the plan and be involved in executing it going forward. This workshop is intended to include the key company project members, selected other company team members, and one or more of the EAI consultants.
Final Enterprise Software Strategy Report Developed and Debriefed: The report includes the sections listed above, with the bulk of the findings in addendums, referenced documents, or other sources. The final report is debriefed to the company team members.
The Enterprise Software Strategy planning process described here is adjusted based on company-specific factors. Please call us if you would like to discuss your ERP improvement ideas/concerns and how our service may help.
Our various ERP white papers provide useful background for Enterprise Software Strategy Planning
SoftSelect was a great partner throughout the process of choosing an ERP solution. They helped us control the terms throughout the ERP buying process, and we achieved impressive results in reduced ERP license fees. Having an experienced partner like SoftSelect, helped us negotiate for the products we need and set our expectations for the process of implementing these solutions.
Long term ERP license costs were initially very difficult to calculate. Working with SoftSelect we were able to insist on a predicable ERP license fee approach and achieve much lower initial and ongoing license fee costs.
Negotiating ERP costs is complicated and the ERP software vendors take advantage of the buyer’s lack of experience. SoftSelect’s experience and influence helped us level the playing field. We clearly saved money and lowered our long term risk.