ERP Investments

WHILE most vendors have been able to construct comprehensive Return on Investment models for their products, these models largely fall short in their ability to accurately measure the total value of an enterprise software investment. This is due to the fact that most return on investment models are focused on quantifiable measures of return. While this is a useful and often necessary function, it leaves a little difficult to fit into a fixed economic model.

Looking at the overall payback that enterprise software can offer to a company gives a more complete analysis of return of investment. Enterprise software payback includes not only quantifiable improvements in bottom and top-line functionality, but also more qualitative measures such as new business opportunities, improves customer and customer goodwill, better relationships with partners, suppliers and other business associates, improved time to market etc.

These intangible benefits also contribute significantly to the success of a company's enterprise software implementation and use. Enterprise software buyers who understand the overall payback that a given product suite can offer their company will be able to make more informed choices that lead to success not just in software deployment but tin overall business functionality.

The ability to define a broad range of payback benefits can be an important addition to understanding how enterprise software provides value across an organization. The broader value of an enterprise software investment defined by payback allows the software buyer to better understand not only the direct financial impact of the investment - the domain of traditional Return on Investment analysis - but also the impact on such areas as new opportunity development, improved customer and partner relations, better business process management and improvements in other organizational and structural factors.

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