Measuring ERP cloud return on investment

Measuring ERP cloud return on investment

Making the decision to adopt an ERP cloud solution is an investment and like any other worthwhile investment a business makes, it requires bringing all the stakeholders and decision makers on board.  And forecasting ROI is going be a key part of assuring them that this is a good solution.

Daryl Plummer of Gartner, Inc. recently wrote an article for that offers a framework for measuring the value of software as a service that is unique to many other investments.  He argues that this assessment has to be unique because the measure of value for services is always approached differently.

He offers the analogy of restaurant service.  When we pay thirty dollars for a steak, we don’t say, “Hey that wasn’t worth thirty bucks.  Where’s the ROI?”  We say, “That was fast and friendly, professional service and the steak was perfectly cooked.  I got my money’s worth and more.”

This is a bit abstract and implies some risk, but measuring the return on investment of SaaS ERP has more levels to it than just how well it satisfies.  Consider cost savings that come from low up-front fees, energy savings, material savings, and IT staffing savings.  Also, consider the ability of hosted ERP to make your business more efficient with less redundancies and increased volume, which will increase profitability.  With all of these factors in consideration you will have a more accurate portrait of what cloud ERP can do for your business.

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