Part 1/3: The Real Cost of Implementing Dynamics 365 ERP

While ERP solutions have become an integral part of enterprise operations, planning for successful implementation of the ERP is still a mammoth task. Therefore, the selection of the right solution and the right implementation partner has a considerable impact on the project. Choosing the right solution ensures streamlined business processes, maximized business opportunities, and greater capacity to drive innovation.

Similarly, choosing the right implementation partner ensures timely implementation and no unpleasant surprise related to timelines, budgets, and resources during the implementation cycle. In order to save the organizations from such unpleasant surprises during the implementation cycle, implementation partners must help them recognize all possible cost heads, including the hidden cost heads, before the project rollout.

Explicit versus Hidden Cost Heads

While factors such as licenses and subscription fees are explicit cost heads, there are some unanticipated cost heads that inevitably arise during the cycle of implementation. These hidden/soft cost heads have a significant impact on the implementation cost of the project and its overall success.

Human factors such as employees, leadership style as well as process factors such as the size of the project team, timelines, and so on fall under hidden or “soft” cost heads. Identifying these cost heads and gauging their impact on the overall implementation helps in accurate budgeting and setting the right expectations with the involved teams.

How Hidden Cost Heads Impact the ERP Implementation

The impact of hidden cost heads on implementation will vary from one organization to another. For example, while employees’ reluctance to move to a particular ERP solution can affect the different stages of implementation – no organization/ERP consultant can ever estimate and say with certainty that there will be 45% resistance from employees will lead to a 10% increase in the implementation cost.

However, once it is established that employees’ resistance could be a major deterrent to the project, proactive measures can be taken to mitigate its adverse impact on the delivery timeline and minimize its impact on the overall project budget.

Similarly, the size and scope of the project, the stage of process maturity when the project is being implemented, and the industry to which the organization belong contribute to the complexity and cost of implementation. For example, if organization processes aren’t mature but the organization tries to nail down a standardized process in the ERP system, they are bound to face process conflicts in the future and shell out extra money later to resolve this conflict.

Also, some industries, such as manufacturing or supply chain inevitably have larger deployments than others – adding to the overall implementation cost. It is therefore critical for the organization and the implementation partner to look at each of the hidden cost heads in a qualitative fashion.

Watch this webinar that explains at length about these hidden cost heads and how to factor in these cost heads during overall cost analysis.

Ready to implement Dynamics 365 Finance and Operations for your business? Contact a Synoptek ERP expert today.