ERP Cost Control

Why ERP License Contracts Are Not True Contracts

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We are pleased to announce our latest educational video, “Contracts to Access ERP - Are Not Really Contracts”, now available on our YouTube channel and embedded below for your convenience. Designed for IT personnel and executives, this concise video examines why typical ERP license contracts from vendors are so fundamentally flawed that they fail to qualify as legitimate contracts.

Drawing on our experience with over 1,000 ERP projects since 1996, the video explains how ERP contracts often undermine buyer protections through vague language, unilateral seller rights to modify terms, and references to external documents with unclear precedence. These elements, combined with explicit constraints on buyers and broad seller privileges, prioritize vendor control and cost escalation over mutual agreement, particularly given the high costs and risks of changing ERP systems. The video also highlights how this industry trend has worsened over the past 15 years.

Watch the embedded video to gain critical insights into the deficiencies of standard ERP contracts and their implications for buyers. For guidance on securing appropriate commercial terms and costs, explore the related resources linked in the video description. Be sure to like and subscribe to our YouTube channel for ongoing ERP expertise. Thanks for your interest, and certainly call us with questions you may have.

Why ERP Software Contracts Are Nearly Useless for Buyers

Why RFPs Are Unsuitable for ERP Selection

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We are happy to announce our latest educational video, “The Unsuitability of an RFP”, now available on our YouTube channel and embedded below for your convenience. Tailored for IT personnel and executives, this concise video explains why the classic Request for Proposal (RFP) process is ill-suited for evaluating and selecting ERP business applications.

Based on our extensive experience with over 1,000 ERP projects since 1996, the video highlights the mismatch between the RFP’s structured approach and the complex, nuanced nature of ERP decision-making. It explores four critical areas—functionality, cost, commercial terms, and implementation services—where RFPs fall short due to vague requirements, opaque pricing models, and the need for direct, strategic engagement with vendors. The video emphasizes that achieving optimal ERP selection, cost control, and durable terms requires hands-on, targeted interactions with sellers, which an RFP cannot practically facilitate.

Watch the embedded video to gain valuable insights into avoiding common ERP selection pitfalls. For additional resources, check the links in the video description and explore our full collection of ERP-focused content. Please like and subscribe to our YouTube channel for ongoing expert guidance.

RFP Approach Fails for ERP Selection

Unlocking Significant ERP Cost Savings

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We are pleased to introduce our latest educational video, “Controlling ERP Costs: Achieving Significant Savings”, now available. This comprehensive 29-minute presentation, based on the insights from our recent white paper, Controlling Costs when Buying Access to ERP, addresses how buyers can achieve substantial initial and ongoing cost reductions when purchasing access to ERP systems.

Aimed at IT personnel and executives, the video draws on our experience with over 1,000 ERP projects since 1996 to highlight the often-exploitative practices within the ERP industry and the critical need for informed buyer strategies. It outlines actionable methods to secure cost savings, potentially reducing typical ERP lifecycle costs by 50% or more. Key topics include:

  • Initial Cost Reduction: Targeting up to 50% off standard ERP pricing through informed negotiation.
  • Ongoing Cost Control: Establishing escalation terms and fixed pricing for additional licenses or subscriptions to greatly reduce long-term expenses.
  • Avoiding Double Payments: Strategies to defer payments until go-live and mitigate costs when transitioning between ERP systems.
  • Protecting Future Flexibility: Securing rights for license retirement, conversion, and data access for retired ERP systems.

The video emphasizes the importance of aligning buyer needs with ERP capabilities, setting realistic cost objectives, and leveraging competition among vendors to achieve favorable terms. It serves as a practical guide for navigating the complexities of ERP purchasing while avoiding common pitfalls.

We invite you to watch this in-depth video below to gain valuable insights into controlling ERP costs effectively. For further details, explore the full white paper and related resources linked in the video description. Stay informed by liking and subscribing to our channel for ongoing ERP guidance.

Control ERP Software Costs

Explores Paying for ERP at Go-Live

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We’re excited to announce a new educational video, Pay for ERP at Go-Live—When It Delivers Value, now available for IT personnel and executives involved in ERP projects. This concise video, led by industry expert Mark Engleman, challenges the conventional ERP payment model and offers practical strategies for aligning costs with value delivery.
Drawing on insights from over 1,000 ERP projects since 1996, the video examines why vendors typically require substantial license fees at the purchase decision, often a year or more before the system goes live. Unlike physical products with high production costs, ERP software incurs minimal vendor costs per instance, yet buyers bear significant upfront expenses for a system that delivers no value until implementation is complete.

The video highlights two primary reasons for this “pay-up-front” model—vendor cash flow and buyer lock-in—neither of which prioritizes the buyer’s interests. It then proposes actionable alternatives:

  • Conducting preparatory implementation work without requiring the ERP system.
  • Negotiating deferred payment terms, allowing buyers to halt projects without further license costs.
  • Starting with limited ERP access and scaling closer to go-live.

These approaches reduce upfront costs, keep vendors engaged throughout implementation, and preserve flexibility for unexpected changes, such as a company sale.

This buyer-centric payment model offers a logical path forward and could reshape industry standards. Watch the video to learn more.

Pay for ERP at go live
Pay for ERP at go live

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