Over the next few weeks I will excerpt here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed. These three customers are part of the first strategy.
“In corporate parlance, “life events,” such as a spin-off, give you a rare chance to revisit your IT landscape. In 2008, Delphi Corp, a major Tier 1 supplier to the auto industry, sold off its Interiors and Closures business unit as Inteva Products to a private investment company, The Renco Group…. at Delphi, we had found the SAP manufacturing functionality lacking. We had separate sequencing, traceability, and other functionality with batch interfaces to SAP. Everything in the middle was a black hole. We determined what amount of product we needed to order about once a week. If there was a change in schedule, we could run out
of parts or we could have too many…At Delphi, IT was 2.5 percent of revenues. Here, we are under 1 percent, and Plex is not even our biggest budget line item — our outsourced network is.” That does not even include operational savings such as better scrap reporting, inventory controls and other Plex supported functionality. In the next wave, Plex will move from the shop floor and core modules into enhanced quality
management, business intelligence and other operational areas.”
Jefferson County is the most populous in the southern U.S. state of Alabama. In September 2014, the county commission decided to move away from SAP, merely seven years after it implemented the software for financial functions. In fact, news stories as far back as 2010 show the county ready to move on even earlier….The county had fallen three years behind on its audits as a result of inadequate reporting from the SAP system. The CFO, George Tablack, has estimated that the lag cost the county another $1.3 million in audit fees.21 That is in addition to the estimated $20 million the county is estimated to have spent on the SAP implementation and maintenance….Commissioner Bowman summarizes: “SAP may be fine for manufacturing companies, but we found it inadequate for our municipal needs.”
The economics of SAP — and the Mouchel costs related to supporting SAP — caught immediate attention as part of the streamlining (at Middlesbrough Council in the UK)…It helped that UNIT4, with its Agresso ERP platform, has had plenty of traction with public sector organizations across the U.K. and Europe, particularly in local government. With over 110 U.K. local authorities using UNIT4 Agresso, there was already serious momentum with larger councils, such as Lincolnshire County’s and neighboring council Redcar & Cleveland, moving away from other “big ERP” packages, largely due to their high costs and inflexibility.
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