SAP recognises need for “measurable IT return”

"We believe that customers' continued success depends on obtaining measurable return from IT investments," SAP spokesman Andy Kendzie said in an e-mail.

SAP recently rolled out a number of Value Engineering tools and services, some of which are available at no cost, for benchmarking system performance and developing business cases for new projects.

While the total cost of ERP ownership is important to monitor and optimise, focusing solely on TCO is no longer sufficient. Organisations must not consider ROI of ERP projects in order to justify continued investment and maximum benefits.
With the downturn in the economy, an imprudent reaction may and has in some cases been to stop any discretionary spending on ERP projects just when their cost-saving, operation improving potential is needed more than ever.

According to research carried out by the Aberdeen Group, many companies now feel compelled to make an investment in ERP as a necessary infrastructure to support their business. However, best practices for maximising the benefits from such a solution involve the measurement of the reduction in costs, improvement in schedule performance and customer satisfaction, and the ability to redeploy employees to add more value to the organisation.

The most regularly cited reason for not measuring ROI of ERP projects is that it is too difficult to measure. The most successful ERP implementations have clear objectives which should be easily quantified and measured so that full gains can be realised.
24% of SMEs point to a lack of tools to measure ROI, however, most if not all of the tools are available within the application for which the ROI is being measured.

The pressure to remain competitive in the dynamic, global economy forces organisations to consider the results-based approach where the question 'Will we see a return on investment (ROI)?' is central.

SAP growth a tribute to smart business investment

SAP has reported 16% growth in software and software related service revenues for the Second Quarter as it reaches the 100,000 customer milestone.

ERP investment hasn’t diminished in spite of the recession, their evidently has been an upsurge.

A Forrester Research survey carried out in the fourth quarter of 2008 that just 1% of Enterprise Software Decision Makers were planning to decrease their ERP investment.
This was during the heat of the recession when businesses were really feeling the pinch. Evidently there was and continues to be an increased awareness of the benefits of ERP Software in all circumstances but particularly when companies want to reduce costs and improve efficiency.

SMBs are now getting back into the ERP software market in light of the recovering economy. They are looking for software to automate their operations and scale for growth.

SAP were perceptive and as a result have benefited from the upsurge in SME ERP investment having focused a substantial amount of investment in their SME solutions which they continue to remain committed to.

“Our focus on customer-driven innovation is positively impacting our growth. Reaching more than 100,000 customers is a testament to the inroads we have made in expanding our volume business and our success in the small and midsized enterprise (SME) segment,” said Jim Hagemann Snabe, Co-CEO of SAP.

“Our success in the SME segment creates a strong foundation for the new version of our on-demand platform SAP Business ByDesign. The new version will be available on time on July 31st and is ready for volume deployment in six countries.”

Though the conventional response during a recession may be to curb ERP investment, businesses are evidently becoming aware that investing now will put them in a better position in the future!

To view the Top 10 benefits and results of implementing ERP in the current economic environment:
http://it.toolbox.com/blogs/erp-roi/ten-reasons-to-implement-erp-during-the-economic-downturn-29577