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STRATEGY > KNOWLEDGE/COMPETENCY
CONTENT > EVALUATE
Research Study Finds Companies Underutilize ERP Systems
SAN MATEO, Calif.—May 30, 2006—A study from Ventana Research reveals that companies are underutilizing one of their key assets: their enterprise resources planning (ERP) system.
According to a recent announcement, the study found that large corporations invest tens of millions of dollars in this type of software, which does their accounting, manages inventories, and handles human resources records. Yet most companies fail to use well-established capabilities of these systems in ways that will reduce their costs, improve customer satisfaction, and support strategic initiatives.
“Finance executives often are unaware of the impact ERP has had on efficiency, so they have been overlooking opportunities to use the full capabilities of the software to generate further savings,” noted Robert Kugel, who directs Ventana Research’s Financial Performance Management practice.
The Cognos- and SAP-sponsored research investigated companies’ attitudes and actions toward ERP and innovation, and the findings are based on an analysis of 391 validated respondents. The survey was conducted with the assistance of media partners that included CMP’s Intelligent Enterprise, GDS International’s CXO Magazine and Business Management US, IT BusinessEdge, Montgomery Research’s CFO Project, Penton Media’s Business Finance, Reed Business’s Manufacturing.net, and TechTarget’s SearchOracle.com and SearchSAP.com, according to the announcement.
Among key findings included in the announcement was that most respondents believe ERP can drive and support innovation in 11 of 12 key functional process areas, such as financial and managerial reporting, purchasing, and compliance and risk management; and that enhancing company performance requires that companies use financial and non-financial metrics to set objectives. The study also found that process automation and integration are proven ways to cut operating expense, increase cash flow, and reduce errors and fraud, yet only half of the study’s participants have implemented an order-to-cash system that can accelerate cash collections, the announcement stated.
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