Short Term VS Long Term Value of SAP/ERP Implementation

Discussing benefits that arise after the initial implementation phase.


The decision to implement an SAP/ERP system can be daunting, especially when weighing the cost against the perceived value. In this conversation between D4M and Eric, we delve into the differences between cost and value in SAP/ERP implementations, shedding light on the benefits that arise after the initial implementation phase. To watch the full interview, click here

Gene: For people who are “on the fence,” please talk about the differences between cost and the value when it comes to an SAP/ERP implementation.

Eric:  That’s a very interesting point, particularly because ERP implementation value has been questioned over the last 30 to 40 years.

Eric:  The value of ERP implementations, and SAP specifically, comes from “realization,” meaning right after the implementation, when standardization is done. When there is a standardized solution, the value is huge. A user can go seamlessly from Plant A can go to Plant B and support them in a day-to-day operation or assist in troubleshooting. It becomes a force multiplier. 

Eric: It’s huge at the operational level, not to mention response and customer satisfaction.
This is realized on Day One after the implementation of this SAP ERP solution and is measured over the time by the ability to maintain day-to-day operation without interruption or impact.

Eric: In the midterm, additional value comes from being able to introduce ongoing improvements into the plan, process and solutions.

Eric: Some question the ability to do quick changes. Having an environment of ongoing improvements leads to a global standard solution. I will argue with those people because you will receive better feedback for ongoing improvements that can be implemented in parallel to a specific template that make sense within the global organization could be available for Plant A implemented. Specific process(es) and solution(s) could be rolled-out to whichever plants are interested in that particular improvement.

Eric:  Ongoing improvements are easier to implement and easier to leverage between one plant and another, which is value realization in the midterm after implementation.

Eric: Unfortunately, that it is not on the first day after the implementation. It takes realistically around three to nine months to start realizing that specific value.

Eric: Those are the two key values that I see. As we think about value, we also think about cost. I’m not talking only about IT support cost but also operational support cost. Why? Now they’re standardized and easier to understand and to maintain and are potentially less resource intensive. 

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D4M International is an IT consulting company focused on transforming manufacturing and operations for optimal performance with SAP and DELMIA. 

We have expertise to help our clients assess, deploy, and maintain key solutions, driving productivity that impacts the bottom line. 

Leaders in Automotive, with expertise in other industries with advanced manufacturing, we operate in North and South America as well as Europe, enabling us to support our clients globally.

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