ERP Value
Operational Benefits - Quantified in terms of EBITDA
What are the real benefits of an ERP integration programme? Management teams can already identify the costs of ERP, but many will struggle to quantify the value. And without a quantified view of value, it’s hard to make an informed go/no-go decision on a new ERP programme, or to avoid an abrupt decision to cancel the programme at a later stage.
At ERP Value, we've developed a new approach to assessing the value of ERP in terms of improved EBITDA. That allows decision-makers to use standard financial project assessment tools like NPV, IRR and payback time. A decision on ERP can be assessed in the same way as any other capex spend.
How we work
A new approach to ERP value
Start with the P&L
Instead of starting with the current ERP landscape and processes, we start top-down with the P&L and look for efficiencies
Identify key savings levers
Some efficiency levers are affected by the ERP and some aren't - we focus on the levers that are most relevant to ERP
Get the baseline right
Our baseline isn't zero, it’s the savings that can be made without any investment in technology - that gives a much more accurate view of value
Assess scale benefits
We next look at scale benefits that can be driven by a single ERP, and tie these straight back to the P&L
Process improvements
Next, we assess the potential benefits from process improvements that can be driven by a new ERP system
Report in plain language
Our output is a clear, straightforward report that sets out the run-rate EBITDA benefits you can expect from an ERP programme, without any technology jargon
About our founder
My background is in technology, but I've worked in the M&A world since 2007. That has given me a view on hundreds of businesses from the inside. I've seen ERP programmes that might cost a million, or ten million or well over a hundred million for a large group. But the decisions about ERP are being made without any view on the value. That's why I decided to build a new approach to quantify ERP value in terms of improved EBTIDA.
