It is daunting for corporate IT buyers to discern the true capabilities, strengths and weaknesses of a given enterprise application suite, given the propaganda that pervades vendors' endeavors to differentiate themselves (see Beware of Vendors Bearing Solutions). When making strategic IT acquisitions Buyer's project teams, inundated with an abundance of available products and technologies, have a difficult time translating the content of glitzy marketing slides and grandstanding presentations into the deliverable products.
Still, as a 'one-size-fits-all' product is still not quite a viable possibility, almost every product can win provided certain set of requirements. The Catch 22 for both buyers and vendors/VARs is to pinpoint the right opportunity in this ongoing 'dating game'.
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This is Part 1 of a four-part tutorial, which addresses this situation from the viewpoint of the Buyers, Vendors, and Resellers.
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Part 2 presents a Solution.
Part 3 presents examples of applying the Solution.
Part 4 makes User Recommendations.
Problem Overview:Prospective customers typically struggle with the following issues when selecting enterprise technologies:
* Their selection project teams have no effective way to define their business requirements and thereby identify the critical vendor and product questions (criteria) necessary to successfully initiate the evaluation process. This time consuming problem rears its ugly head at a very early stage of the project, resulting in a rapid loss of the staff's enthusiasm to implement new technologies. One possible option is to hire an outside consultant that will lead you through a number of interviews, meetings, workshops, etc. to determine your requirements, but this process may be overkill for many mid-market organizations.
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* When these criteria have eventually been pinpointed and submitted to (hopefully) the most appropriate vendors, project teams often lack the ability to effectively prioritize the different criteria relative to their importance to supporting the requirements. As a result, priorities are derived from internal political agendas rather than the true needs and requirements. Without having a valid statistical tool to keep these priorities in check and to conduct simulations of results after changing priorities, it is not unlikely that some department's needs (e.g., accounting) been unreasonably high contributors to the total decision.
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* Also, project teams have no ability to obtain objective, validated current data on the available vendor alternatives. Unfortunately, most project teams lack the ability to separate fact from hype, especially because its strategic technology selections are often either the first of its kind or the first in an extended period within a specific organization.
As a result, the vast majority of enterprise technology evaluations run over time and budget. Once selected, majority of the implementations fail to meet functional, return on investment (ROI) and total cost of ownership (TOC) expectations (see ERP Trivia - Every Why Should Have Its Wherefore). At the same time, the number of companies, which are able to substantiate (quantify) the rationale of the decisions to go with some product in the past, is sadly negligible. A much higher number of decision makers rely solely on frivolous justifications like their gut-feel, executive mandate, or tiresome spreadsheet compilations without ability to discern the best solution (other than to arithmetically count the number of pluses and minuses, without taking into considerations their true importance).
Many companies have consequently been stuck with under-performing software products and dejected users, and are still unable to calibrate their system to determine how far they are from the ideal solution for their business requirements. In other words, even after all the pain, many are unable to benchmark whether to maintain the status quo or try another luck in selecting the right product this time. The enterprise applications users' predicament has been duly covered at the TEC web site in the past. See the following articles:
1. Application Erosion: Eating Away at Your Hard Earned Value
2. Application Erosion: More Causes and Cures
3. The "Old ERP" Dilemma: Replace or Add-on
4. The Old ERP Dilemma: How Long Should You Pay Maintenance?
Vendors, their value added resellers (VARs) and system integrators (SIs) are not in an easier situation either, despite their tendency to often overselling their products. On the vendor side, the challenge of educating the potential client of their offerings results in painfully long and costly sales cycles, painstaking and numerous RFI responses time and again, and the potential for pursuing a mismatch opportunity, resulting in projects that can go terribly awry. These failed projects do not bode well for the vendor, since the sales cycle costs can only rise even more, and their reputation can suffer. The consequences can be much more severe for the client where it can, in extreme cases, lead to business failure.
For implementers, the issue is similar: having inadequate fit-gap information for the implementation phase means an inability to properly plan and execute the implementation, or for a consultant to assist the end client in making proper technology decisions. Implementers (which can be internal IT departments as well as outside consultants) can also find that decision-maker indecision leads to lengthened sales cycles, missed opportunities, and risk of competitive intrusion.
Often the users don't know why a particular product was selected in the first place, and the vendors and VARs are not sure why they have won/lost some opportunities. Even winning serendipitously is not good, as it does not grant recurrence. Did we win because we had the best product, because we demonstrated it best, or maybe because the Vendor X and Vendor Y were not invited to bid?
Many vendors turn to industry analysts and IT research firms to provide them with a sort of fortune-telling service and/or to assist them in their product marketing strategy. This is an awkward situation for both parties. Analysts have to walk a tightrope. They may need to tell the vendor (and the market) bad news while trying not to alienate it. They also need to be able to remain on a friendly basis (possibly a retainer relationship) with the vendor's fierce competitors, while preserving their neutrality and the authority in the market. To that end, analysts typically resort to a high-level, often ambiguous research report, so that all the parties remain satisfied and there are few bruised egos and broken relationships.
While it would be unfair to disparage the visionary and strategic level research that some analysts provide to vendors to help them determine their future direction (e.g., buying market forecasts, whether to embrace Web Services, etc.), this by no means answers all the questions vendors often wonder about. For example:
- What and how many product functional and/or technological features do we have to achieve to be the absolute frontrunner in the market segment or to beat the Vendor X in a particular face off? Does the newly released module or the latest product upgrade make us significantly more eligible to compete in the market segment?
� - Why are we one of the leaders in certain industry, for mere a number of installations? How many of these have come from, e.g., our accounting or HR solution only as opposed to from our sharp industry solution per se? Were we perhaps the first one to tackle the market segment; if so, is our solution still stronger than a newcomer's one, with fewer customers but with a formidable offering we don't know much about yet?
� - Should we compete (and commit to the non-refundable hefty expenses and resources involved) in a selection against a large vendor that certainly has more functionality, but is less flexible than we are? What other tradeoffs should we present to the customer knowing our strengths/weaknesses, and will it fly? Do we have any more concrete documentation to back up our claims other than an Analyst A's fluffy report that arbitrarily praises our product (the opponent will likely have a similar report form the Analyst B)? What about competing against a dark horse vendor we've never seen before, but the market seems to be raving about its product?
The actionable, quantifiably substantiated, and in no uncertain terms answers to the above questions, while arguably obtainable from traditional analyst houses, would likely be exorbitantly expensive, given the annual subscription fees for much less granular information and service these firms traditionally charge.
Therefore, despite apparent adversarial relationships, all parties have meanwhile realized the need for thought and research to build data and process information in a meaningful context, which takes time and costs money for all parties going through the selection process. But without spending time, thought, research and money there is increased business risk to all, unless there is an existing inexpensive solution to provide a structured, repeatable process for evaluating technology solutions and the vendors that provide them.
Most business managers, whether within vendors, prospective clients or implementers/resellers, have long yearned for an enabling system to minimize project risk for all sides of technology utilization. For instance, by narrowing products down to a shortlist based on functional and technical features, vendors/VARs benefit from not pursuing unfruitful clients, and clients benefit because the short list is usually reduced to a manageable size, while everybody benefits because this tedious phase that can be streamlined.
Accessing TEC's ERP Knowledge Base:
The list of vendors currently present in TEC's Discrete Manufacturing ERP Knowledge Base (see it in action) includes:
| Vendor | Application Suite |
| Adonix� | X3 |
| Baan� | iBaan |
| Epicor� | Vantage |
| Frontstep� | SyteLine |
| Glovia� | Glovia.com |
| IFS� | IFS Applications |
| InterBiz� | PRMS |
| J.D. Edwards | OneWorld |
| Lilly Software Associates | VISUAL |
| Made2Manage | M2M Enterprise Business System |
| Microsoft Great Plains | eEnterprise |
| Microsoft Great Plains | �Solomon IV |
| Navision� | Attain |
| Navision� | Axapta (Formerly Damgaard Axapta) |
| Oracle� | Oracle Applications |
| QAD� | MFG/PRO |
| Ramco� | e.Applications |
| Relevant Business Systems�� | INFIMACS II |
| ROI Systems | MANAGE 2000 |
| SAP� | mySAP.com |
| Syspro� | IMPACT Encore |
To accommodate different needs and/or budgets, TEC offers different options for accessing the TEC KB's content at http://webtess2.technologyevaluation.com :
- To access one selected vendor's data for a week: $250
- To access three selected vendors' data for a week: $600
- To access the entire KB's content for a month: $5,000
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