587 — Nucleus Research spots no-ROI on SAP solutions

Mar 31, 2003 | Conteúdos Em Ingles

Nucleus Research, a US provider of technology research and advisory services, found out that 57 per cent of 21 SAP’s flagship customers were not getting return on their investment. For a three-year period, Nucleus reported an average SAP deployment cost of 13,5 million euros. Licenses for SAP CRM ranged from 93,500 to 467,000 euros. SAP has already dismissed the research as “unscientific” and “unreliable”.

“Nucleus found out that the companies interviewed had achieved a number of benefits from their SAP solutions. Yet, a majority of these organisations reported that these returns had not yet outweighed the costs of implementing, customising and supplying their SAP infrastructures ,” the report stated.

Lack of breadth and repeatability, high personnel costs and excessive customisation are the key challenges appointed by Nucleus for companies in the achievement of a positive ROI.

“Many companies invested in large SAP licenses without explicitly evaluating costs and benefits, considering payback period, or developing a clear road map aimed at the full exploitation of SAP ’s functionality”.

When asked by Nucleus about the ROI from a company’s implementation of SAP R/3, a project manager said: “There is no ROI from SAP . People just tend to put these systems in and await the return”.

According to the report, one SAP customer who achieved a positive ROI did so by ensuring that the system was rolled out to more than 1000 internal and 7000 external users, “so small savings in efficiency per transaction produced significant returns”.

Nucleus also found out that the high personnel costs associated with implementing SAP were a challenge to the quick achievement of a positive ROI. “This is specially true for all ERP deployments and a number of SRM deployments studied. The ERP deployments in this sample required the involvement of anywhere from 25 to 200 full-time internal personnel for implementation”.

Nucleus based its research on 93 SAP’s reference customers, but only 21 agreed to participate in interviews.

Filipe Samora
2003-03-31

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