2010 Organizational Change Management Report Released

Panorama Consulting Group, an independent ERP consulting firm, today released the next installment of the firm’s 2010 ERP Report. This report focuses on the sensitive issues that arise during ERP implementations and the organization’s ability to leverage the effects of organizational change management.

Organizational change management is a broad topic that encompasses employee buy-in, organizational design, communications and training. It also includes, but is not limited to, cultural assessments, organizational assessments, and executive alignment. The report reviews the seven key areas of a comprehensive ERP organizational change management plan and provides metrics for each area.

“The report highlights some interesting data concerning organizational change and how it relates to ERP implementations,” said Eric Kimberling, president of Panorama Consulting Group. “One key data point within the report is the average organization’s drivers for changing their existing business processes. The report findings show that 41% of respondents changed business processes to accommodate ERP functionality, while just 27% changed or customized ERP functionality to accommodate current business processes. Clearly some companies are allowing their ERP software to determine their future business processes,” which highlights the need for an effective organizational change management strategy.

To offer further analysis of the study results, Kimberling will present the free webinar, Thursday, on June 3 at 10:00 a.m. MDT.

The full report is available for download at: http://panorama-consulting.com/resource-center/2010-organizational-change-management-report/.

Panorama Consulting Group 2010 ERP Report

The 2010 ERP Report was conducted by Panorama Consulting Group via online polling and was supplemented with qualitative data gathered from focus group interviews with a sample of survey respondents. Information was collected from December 2005 to December 2009. The 1,600 participants represent global organizations that have implemented ERP within the last four years.

Panorama Consulting Group Issues 2010 ERP Vendor Analysis

Panorama Consulting Group, an independent ERP consulting firm, today released the 2010 ERP Vendor Analysis Report. The 2010 ERP Vendor Analysis Report provides findings on detailed project factors such as implementation costs, durations, and payback periods summarized by vendor.

Though nearly three out of four companies (72%) indicate that they are least “fairly satisfied” with their enterprise resource planning software, the majority fail to realize even half of the business benefits expected after ERP implementation. The findings were relatively consistent across vendor tiers, with a total of 55% of companies reporting realization of just 30% or less of expected benefits. Tier III ERP software clients realized the least amount of benefits (72% reported less than 50% realization) with Tier I ERP clients close behind (69.8% reported less than 50% realization). Over half of Tier II ERP clients (53.3%) reported less than 50% realization but nearly half (46.7%) reported more than 50% realization.

“The fact that most companies are initially satisfied with their ERP selection but then fail to realize more than half of the expected benefits indicates widespread underutilization of the capabilities of these packages,” said Eric Kimberling, president of Panorama Consulting Group. “No matter how robust the enterprise software is, it must be fortified with change management and end-user training to ensure it is being used to its full potential.”

The report confirmed previous findings that each vendor tier has its own set of strengths and weaknesses. Tier I ERP vendors had a strong showing, with SAP as the most commonly short-listed vendor (20.4%), Oracle eBusiness the most frequently selected ERP solution (54.2%), and Microsoft Dynamics has the shortest “payback” period of all the major solutions (2.6 years). However, Tier I ERP implementations are more likely to take longer than expected (30%) as opposed to Tier II (18%) or Tier III (5%). Tier I ERP solutions are much more likely to require heavy customization (25%, on average) than their Tier II and Tier III counterparts (6% and 12%, respectively). In addition, Tier I ERP systems take an average of three years to “payback” their cost, while Tier II ERP packages take 2.2 years, and Tier III ERP packages take only 1.7 years. Conversely, with 70% of clients rating themselves “fairly satisfied” or better, Tier III ERP solutions have the lowest satisfaction levels of all the vendor tiers.

“Companies must weigh so many factors during an ERP evaluation – and put out so many fires during a software implementation – that it’s no wonder many of them fail to realize the full scope of possible benefits,” said Kimberling. “Third-party consultants can provide ERP selection advice, implementation supervision, and organizational change management services to help companies more effectively harness the power of their ERP software.”

To offer further analysis of the study results, Kimberling will present the free webcast, Understanding the Differences Between Leading ERP Software Solutions, on April 1 at 10:00 a.m. MDT. Register for the seminar at: http://panorama-consulting.com/resource-center/erp-webinars/.

Panorama Consulting Group 2010 ERP Report

The 2010 ERP Report was conducted by Panorama Consulting Group via online polling and was supplemented with qualitative data gathered from focus group interviews with a sample of survey respondents. Information was collected from December 2005 to December 2009. The 1,600 participants represent global organizations that have implemented ERP within the last four years. The full report can be accessed at: http://panorama-consulting.com/resource-center/2010-erp-vendor-analysis/.

Panorama Consulting Group

Founded in 2005, Panorama Consulting Group is a niche consulting firm specializing in the enterprise resource planning (ERP) market for mid-sized companies in North America and Europe. Independent of affiliation, Panorama helps firms evaluate and select ERP software, manages the implementation of the software, and facilitates all related organizational change management to assure that each of its clients realize the full business benefits of their ERP implementation. More information can be found on its web site, www.panorama-consulting.com.

Panorama Consulting Group Releases 2010 ERP Report

Panorama Consulting Group, an independent ERP consulting firm, today released the 2010 ERP Report. The Report includes data on a wide variety of traditional and SaaS ERP software solutions.

While the average cost of an ERP implementation has decreased from $8.5 million in 2008 to $6.2 million in 2010, companies are realizing significantly less business benefits from the technology, according to the 2010 ERP Report issued today by Panorama Consulting Group, an independent ERP consulting firm in Denver. The report reveals that two out of five (41%) of participants failed to achieve at least half of the business benefits they expected. This figure is nearly double the finding in the 2008 ERP Report (21%).

“While it is promising to see the costs of ERP implementations decrease, we are concerned that it is at the expense of organizational change management and other key activities required to make enterprise software initiatives successful,” said Eric Kimberling, President of Panorama Consulting Group. “Companies that cut costs in these areas suffer lower levels of satisfaction, user buy-in, and return on investment.”

The 2010 Report provides further data on the importance of balancing a company’s high expectations of ERP systems with comprehensive organizational change management initiatives. While 69% of companies expect that a new system will improve business performance and 39% expect it will make employees’ jobs easier, more than half (53%) of respondents assess their company’s ability to deal with change as fairly poor or very poor. Nearly half (47%) indicate communication between management and employees is poor. In addition, more than two out of five (41%) of respondents have experienced significant changes to their business (e.g., a new CEO, new locations, mergers and acquisitions, and layoffs) during the implementation process.

“Turbulence in business operations is magnified by the stress of an ERP implementation,” said Kimberling. “Management must allocate proper time and realistic spending to ensure that employees are aware of the benefits of the process and ready to accept and work through the challenges of a system changeover. In addition to hiring third-party consultants to help with software selection and implementation, smart companies are looking for outside assistanceto manage the user-side processes that are so critical to project success.”

To offer further analysis of the study results, Kimberling will present the free webcast “Overview of Panorama’s 2010 ERP Report,” on Wednesday, February 17, 2010. Register for the webinar at http://www.panorama-consulting.com/erp-webinars/.

About the 2010 ERP Report
The 2010 ERP Report is based on research by Panorama Consulting Group via online polling and was supplemented with qualitative data gathered from focus group interviews with a sample of survey respondents. Information was collected from December 2005 to December 2009. The 1,600 participants represent global organizations that have implemented ERP within the last four years. The 2010 ERP Report can be accessed at: http://panorama-consulting.com/resource-center/2010-erp-report/.

About Panorama Consulting Group
Founded in 2005, Panorama Consulting Group is a niche consulting firm specializing in the enterprise resource planning (ERP) software market for mid-sized companies across the globe. Independent of affiliation, Panorama helps firms evaluate and select ERP software, manages the implementation of the software, and facilitates all related organizational changes to assure that each of its clients realize the full business benefits of their ERP implementation. More information can be found on its web site, www.panorama-consulting.com.