“For one thing, because all businesses in a private equity portfolio will soon be sold, they remain in the spotlight and under constant pressure to perform.”
(Barber & Gold, 2007, “The Strategic Secret of Private Equity”, Harvard Business Review, Sept Issue)
Private Equity Performance is Mandatory
Constant pressure to perform means diligent management of budget, cash flow, profits, and deliverables. Private equity is about buying and enhancing portfolio value. Portfolio performance is about growing and building (or saving) a business into one that is healthy, vibrant, and profitable.
ERP Pain Point
At a cost in the millions of dollars, ERP organizational change efforts can have significant impact not only financials but in terms of short and long term organizational improvements. But, according to our friends and colleagues at Technology Evaluation Center (and frankly well published and known throughout the ERP field):
- ERP Pain Point: Nearly 50% of ERP Implementations fail the first time around
- ERP Pain Point: On average, ERP implementations take 30% longer than estimated
- ERP Pain Point: Regardless of deployment method, most implementations cost 3-4 times what is budgeted.
- ERP Pain Point: About 65% of the time, budgets go over because the system needs modifications to improve usability. But companies realize this only after the implementation has started
ERP Pain Point: There is a Cure
Is this “just the way it is”? Why is this acceptable? Why does this have to be acceptable? Actually, this should not be, and isn’t, an accepted norm. But these statistics are telling us that we need to do something different. This is why Nestell & Associates is changing the way we think about ERP organizational change. Stay posted to future posts or contact us today to find out more.
Learn more from this insightful article: https://nestellassociates.com/why-should-pe-firms-care-about-erp-critical-success-factors-because-erp-transactions-are-dollars/
Nestell & Associates de-risks ERP implementations for private equity portfolio companies through strategic analysis, planning, implementation and support.