Types of ERP Software Consulting Firms: Pros and Cons
After an organization selects a new ERP system, in many cases the ERP software vendor is not the only firm available to provide implementation services. With that said, over the years I have observed certain attributes associated with different types of implementation service providers. Some good, and some not so good.
Of course, any list of pros and cons for various types of consulting firms cannot be viewed as a set of hard and fast rules. In the final analysis, what really counts is the quality of the individual consultants available from a particular firm. However, understanding some of the subtleties can help you zero in on the right vendor to hire for project management and application consulting services.
Primary Service Providers
When implementing ERP, many organizations will augment their project team with independent contractors for project management, software development, and application consulting support. This is all well and good, in the right situations. But there are three basic classifications of primary service providers.
- The ERP software vendor.
- A “Big Five” firm or a large technology company.
- A third-party independent firm that specializes in the package.
Here is my list of pros and cons, and I would like to hear yours…
- Single point of accountability for the ERP software and implementation.
- Implementation processes more consistently applied from project to project.
- Overall, application consulting expertise tends to be better than average.
- Ease of consultant access to technical support resources within the vendor organization (sometimes outside of formal support channels).
- More support and technical expertise (after all, they developed the system).
- Dedicated training facilities, resources, and formal training programs.
- Sometimes willing to make unique software customizations for their customers that later become part of the standard product offering.
- Can be the only option available.
- Usually more expensive than third-party independent firms since the software vendor is often viewed as the “safe choice”.
- Project management consultants tend to be generalists or “scorekeepers” with less knowledge of the application or technical areas.
- More methods and tools for preparing implementation services quotes (perhaps leading to more realistic schedule and budget),
- Firm management is usually more experienced in providing project oversight and guidance to the executive steering team and the project management team.
- Additional industry expertise and project management services are usually available from within the firm.
- Well-developed implementation methodologies, processes, and deliverables.
- Overall less experienced application consultants due to the practice of hiring recent college graduates with no previous business or ERP software experience.
- Usually, a lot more expensive.
- Perhaps fewer software development or technical resources specific to the package.
- Tendency to push additional services that the client really does not need.
- May lack facilities, materials and documentation to consistently train client teams on the software (courses typically developed from scratch or close to it).
- The focus of the firm is providing training and implementation services for a particular package(s).
- Perhaps the best value from an application consulting standpoint considering their level of knowledge and lower hourly rates.
- Project management consultants tend to be more hands-on since many have significant application consulting experience.
- Greater propensity to lowball the quote for competitive reasons (and then the client is later surprised by cost overruns).
- Less defined implementation processes (consultants tend to do their own thing when it comes to approach).
- Fewer resources of any kind in terms of bench strength.
- Perhaps heavy use of sub-contractors.
[This post originally appeared on Toolbox.com and is republished with permission.]
[Steven Phillips is an ERP professional with over twenty-seven years of implementation experience. He is the author of the book “Control Your ERP Destiny” available at Amazon, Apple iBooks, Barnes & Noble and through many other international booksellers.]