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    The Benefits of an ERP Audit in the COVID-19 Era

    Posted by Kevin Heisler on Jun 9, 2020 4:32:53 PM
    ERP Audit Benefit in COVID-19 Era

    Over the past three months, the COVID-19 virus and the accompanying pandemic has single-handedly caused a rapid down shift in economic activity never before seen in the modern industrial and post-industrial world. A recent article in The Atlantic addressing the incongruity of a record stock market rally taking place during a time of economic upheaval and widespread joblessness cleverly described these strange times we’re living through: “The COVID-19 crisis is simultaneously thrusting Americans into the pre-urban homestead economy of the 1830s, re-creating the Depression-era joblessness of the 1930s, and pulling forward the virtual economy of the 2030s. We are living in the weirdest economy ever.”

    While our client serving professionals at Meaden & Moore are navigating a new way of working, whether its fully remote or slowly returning to vastly changed office environment, we are also trying to determine the best way to re-engage with and serve the needs of our clients. While we know more now than we did when the lockdowns began in March, there is still a tremendous amount of uncertainty that lies ahead.

    Our discussions within the Management Consulting Services (MCS) group on how to adjust our approach has been rooted in the reasonable assumption that overall demand for goods and services is likely to decline or stagnate for the foreseeable future. Given that reality, our conversations with our clients’ leaders and managers have shifted to address the unavoidable pivot from the past half-decade of “growth mode” to a keep-the lights-on, survival mindset.

    For the MCS group, this has meant an increased focus on our ERP Audit, or “Suitability/Utilization Analysis” service offering. In comparison to our primary ERP Package Selection and Implementation services, performing an ERP audit is less costly and less time intensive. However, depending on the utilization of current business software, the “bang for the buck” often outpaces the ROI of selecting and implementing an entirely new system.

    Most simply, the benefits of an ERP audit derive from improving the use of current ERP software. Enhancing ERP utilization leads directly to improved business results: better speed, delivery reliability, accuracy/quality, and cost/expense management. The foundational principle for the ERP audit is captured by noted business process maven H. James Harrington, who famously stated, “Measurement is the first step that leads to control and eventually to improvement. If you can't measure something, you can't understand it. If you can't understand it, you can't control it. If you can't control it, you can't improve it.” We seek to enhance utilization through an ERP audit and benchmarking exercise that will measure current use of existing business software, as well as the fit of the current version and target upgrade version.

    The deliverables produced from this measurement component of the ERP audit are disparate but complementary:  1) A summary of the theoretical ability of the ERP system to support business requirements, and 2) and an analysis of the actual use of the available capabilities of current business software. Based on this report from measurable data, we can identify implementable recommendations for improving processes, improving the use of existing ERP features and functions, changes to the existing ERP to increase effectiveness in supporting processes and requirements, and, if necessary, the purchase of new ERP modules and add-on software to increase effectiveness.

    Particularly in this uncertain and rapidly evolving environment, improving business performance in a cost-effective manner can provide a major advantage for our clients looking to get navigate the present turbulence while enabling them to quickly change gears to take advantage of the next growth cycle. For more information, please contact us. 

     

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    Topics: ERP, Management And Technology Resource, Technology, COVID-19

    Kevin Heisler

    Written by Kevin Heisler

    Kevin Heisler is a Senior Manager in M&M’s Business Solutions Group. He has spent 10 years in management consulting and project management.

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