Don not deliver a system, deliver a competitive advantage
Each of my articles is the result of my experience, observations, and reflections.
Starting from the principle that, in this world, what has no value is free and unimportant, it's easy to conclude that everything we do with care must be measurable to be appreciated.
Therefore, the success of a project is measured by the added value it brings to the company, and not solely by adherence to the schedule and budget planned for its implementation.
Many teams rightly focus on the deliverable: the installation, the configuration, the go-live. But an operational system does not guarantee the expected value creation.
For me, the real difference between a "good" project (which delivers what was planned) and a successful project (which positively transforms the company) lies in a single imperative: identify and measure the expected and produced values, as early as possible, and continuously throughout the project life cycle.
Adopting this approach changes the traditional client/vendor dynamic. It allows us, as consultants, to position ourselves not as mere technical executors, but as true strategic partners.
By ensuring constant vigilance over concrete benefits, whether operational or managerial, we prove that our role extends far beyond the deployment phase.
It is this expertise in measuring and optimizing value that establishes a lasting relationship of trust and, we can say, creates a positive dependency: the client knows that we can be the guarantors of achieving their business objectives, beyond merely checking all the technical and functional boxes in their specifications.
Limiting oneself to traditional software implementation schemes is to risk creating a project that leads to technical success but proves to be a strategic failure.
I will therefore delve into the exploration of the value of an ERP project.
The identification of dual value
A successful ERP project generates two types of intrinsically linked values, which must be defined from its very first phase:
Operational / quantitative value (the "What")
These are the tangible, measurable, and financial benefits that directly impact the company's operations.
Examples:
- Cost reduction: Decrease in inventory, data entry errors, and maintenance costs for old systems.
- Efficiency increase: Reduction in order cycle time, acceleration of the accounting close time.
- Productivity improvement: Increased transaction processing rate per employee thanks to automation.
These objectives constitute the classic Return on Investment (ROI) and must be formalized into clear and quantified Key Performance Indicators (KPIs).
Managerial / qualitative value (the "How")
This value is more abstract but equally essential, as it relates to the company's capacity for adaptation, innovation, and decision-making.
Examples:
- Better decision making: Improved data quality and availability thanks to a single source.
- Agility and flexibility: Ability to quickly integrate new acquisitions or adapt to new regulations.
- Staff satisfaction: Decrease in frustration caused by manual or repetitive tasks and by aging systems.
- Governance: Better alignment of business processes with the company's strategy.
Although initially qualitative, indirect KPIs can be used to measure them (e.g., user satisfaction rate, response time to strategic information requests, etc.).
The evaluation of a project's value
The real value of a project is measured by evaluating all supported costs—both economic costs and opportunity costs—and subtracting this figure from the expected benefits.
The economic cost
The economic cost represents all direct monetary expenses for the acquisition, deployment, and maintenance of the ERP over a given period (licenses, consultant fees, support, etc.).
The opportunity cost
This is the value of the benefit or opportunities forgone by deciding to undertake the ERP project. It is the implicit cost linked to resource mobilization.
- For the company: The profit the company could have generated by investing the same budget in an alternative project (e.g., R&D, new production machine, marketing campaign).
- For employees: The loss of productivity (and therefore revenue/value) due to the time that key users and the IT team dedicate to the ERP project (tests, design workshops, training) instead of their usual productive activities.
The expected benefits
These are the financial gains and strategic improvements that the ERP must produce.
- Financial benefits (Productivity gains): Direct savings and efficiency increase. Example: Reduction of accounting close time from 15 days to 3 days. Decrease in the order error rate.
- Strategic benefits (Performance improvement): Impact on decision
- making and competitiveness. Example: Access to real
- time dashboards for immediate piloting. Improvement of the customer service rate.
By comparing these three indices, we obtain the value produced by the project:
{Net Value} = {Expected Benefits} - ({Economic Cost} + {Opportunity Cost})
The necessity of continuous measurement
The fatal mistake is to measure value only after going live. Value must be at the heart of project management, before, during, and after Go-Live.
- Prioritizing features: Every decision (configuration, specific development) must be justified by its contribution to the defined values. If a feature brings no value, it constitutes an unnecessary cost.
- Aligning Stakeholders: It provides a common objective and shared language between IT and Users, transforming the project into a business initiative rather than a simple technological deployment.
During execution: The role of a safeguard and a catalyst for buy-in
Measuring value during construction and testing ensures that the project stays on the right track:
- Real progress measurement: Technical indicators (budget, schedule) are vital, but they must be supplemented by measures of business impact. This ensures that the change being implemented truly corresponds to the desired change.
- Anticipating drift: If functional tests reveal that future users will not save the anticipated time, it is the moment to review the process.
- Engaging Key Users: The concrete and measurable demonstration of efficiency gains during testing is the best way to get buy
- in from key users who have not yet adhered to the project. Seeing the new system deliver tangible value transforms the perception of a technical constraint into an opportunity.
After the Go-live: The role of ROI justification
Continuous post-launch measurement allows for:
- Validating the ROI: Comparing actual KPIs to initial objectives proves that the investment was justified.
- Identifying bottlenecks: If productivity does not increase as expected, the measurement reveals where the system or user adoption is not optimal, enabling targeted corrective actions.
Do not limit yourself to the deliverable
Limiting oneself to the deliverable diminishes the quality of the project.
Just as in martial arts an effective strike is a strike aimed beyond the target, in an IT project, an effective solution is a solution designed to meet future needs.
The go-live (going into service) is an event, but it is not success. It is the starting point of operation.
A project that respects the scope and schedule but does not produce the expected benefits is a project that was "delivered," but not a successful one.
True success is measured by:
- The actual usage of the solution.
- The impact on operational performance.
- The ability of managers to pilot with reliable data.
In conclusion, I will end this article by emphasizing that evaluating key operational and managerial performance indicators throughout the life cycle of a technological project helps to make it a catalyst for long-term growth and success for the company.