Panorama’s ERP Report reveals important facts

For a long time, the ruler of project reports was Standish Group’s (in)famous Chaos report, which analyzed IT project success/failure factors. While many of the Chaos report’s findings applied to ERP implementation, the report as a whole was primarily about software development projects. And as we all know, implementing ERP is not the same thing as software development. Hopefully.

Panorama Consulting Group, an independent ERP consulting firm from Denver, Colorado, has conducted a market research in 2008, that explains ERP implementation project success factors and reveals some interesting metrics about real ERP costs, duration and benefits. Finally, we have a decent ERP project report, which reveals some important facts about Microsoft Dynamics.

Panorama Consulting Group recently published their ERP Report, the final result of a comprehensive study of 1322 companies that have implemented ERP in US, Europe, Australia and India.

The report comes in two parts. The first part explains ERP project challenges, risks, duration, cost vs. budget ratios, post-implementation benefits and success factors.

The second part focuses on specific ERP products, and demystifies some basic facts about top ERP project vendors.

According to their findings, 72% of ERP customers chose SAP, Oracle or Microsoft’s solutions, while only 28% of the customers chose other vendors. The report continues by revealing average and median project durations, costs, and satisfaction breakdown by top three vendors (Tier I) and other vendors (Tier II). This part reveals some interesting facts about Microsoft Dynamics.

Microsoft Dynamics ERP solutions (the report doesn’t break it down by specific product lines) are the 3rd most common, with 14% market share—as much as the combined market share of Baan, Epicor, IFS, Infor and Sage.

Microsoft Dynamics solutions come with shortest average implementation duration of the Tier I vendors, and the lowest implementation cost of all ERP vendors. But saying “the lowest” doesn’t do Microsoft Dynamics right: “the lowest” means 6,5 times less than average SAP implementation costs, 4,9 times less than average Oracle implementation costs, and 3,25 times less than average implementation costs of all ERP solutions.

Also, from cost perspective, implementing Microsoft Dynamics solutions proves to be the most predictable choice: quartile deviation of Microsoft Dynamics is 9% that of SAP, 11% that of Oracle, and 20% that of all ERP vendors.

Finally, Microsoft Dynamics has employee satisfaction rate of 76,9%, the highest employee satisfaction rate of all ERP vendors, 12,5% higher than overall average for all ERP vendors.

Microsoft Dynamics isn’t made from pure gold, though. It lags behind other vendors in executive satisfaction, and it has larger quartile deviation in project duration, making it the least predictable in project duration. However, with the shortest average duration of the Tier I solutions and lowest costs of all solutions, the duration deviation alone doesn’t blur the fact that its provides most bang for the buck, and by far so!

If you missed the link above, click here to access the whole report.