The Replacement System –

Why, How, When, and WhoJuly 10, 2012

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About Your Presenter

• Sr. VP KeyedIn Solutions Consulting Group

– Helping companies align their business and technology

– Focus on people, process, and then the technology

– Subject matter expert on business process management

– On-going research into next generation of technology for

enterprise systems

• 25 years experience in enterprise systems

– USAF Research Project (1985)

– Founder of enterprise quality software company (1988)

• Trusted advisor to global organizations, government

agencies, and professional groups

http://www.linkedin.com/in/johncachat

Thought for the Day

It is better to know some

of the questions than all of

the answers

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Today’s Discussion

• Key Considerations

• Replacement Options

• Deployment Options

Key Considerations

• Size of your organization

• Skills, experience, workload of resources

• Budget

• Control

• Timeline

• Security concerns

• Supply chain and regulatory issues

• Number of expected annual transactions

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So You Decide To Get A New System…

It is important to ask the right question

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Common Better

What is the best

system?

What system is cost effective and

allows us to meet our business

needs?

What vendor scored

highest on the RFI?

What vendor took the time to

understand our needs?

What vendor is the

lowest cost?

What vendor provided a realistic

and comprehensive quote?

Replacement Options

• Internal development

• Contracting an Independent Software Vendor

(ISV)

• One vendor

• Best of breed (multiple vendors)

• Open source applications

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Internal Development

Pros Cons

System is custom built – you get exactly

what you want

No annual maintenance costs, no annual

support costs to a vendor

Complete control of upgrades and

enhancements

Internal developers more accountable

than external vendors

Involves a great deal of design time.

Mistake early on are very hard to fix

later.

No source of resources that already

know the system

Internal developers may not be best

resources for new product

development.

Testing is 100% on you.

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Contracting an Independent Software Vendor (ISV)

Pros Cons

Typically cheaper and faster than

internal development

Complete control of upgrades and

enhancements

Involves a great deal of design time. Mistake

early on are very hard to fix later.

No source of resources that already know the

system

ISV business sustainability, especially if

knowledge transfer and documentation is

poor.

Testing is 95% on you.

Communication delays & hidden costs

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One Vendor

Pros Cons

Assumption is a mature and fully

tested application

There is a source of resources that

already know the system

Other organizations are involved in

testing and resolution of issues

Support calls go to a single company

Out of the box may not fit

Support costs @ about 20% per year

Customizations are expensive and

take you out of standard upgrade

path

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Best Of Breed (Multiple Vendors)

Pros Cons

Each application is better than the

generic functionality in a single

enterprise applications

Better fit should mean less business

process change, faster deployment

Cost, maybe

Integration, integration, integration

Multiple contracts, support agreements

Finger pointing on problem resolution,

especially in integration and reporting

areas

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Open Source Applications

Pros Cons

Large development community that

has resources that can be hired

Ability to customize to meet end user

needs

Less changes to internal business

process

Many OSS applications are not fully

mature / tested

Customization may lead to

unexpected errors, especially if

coding and documentation is poor

Possible security concerns

Possible licensing (legal) concerns

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Deployment Options

Option Comments

On-premise – traditional license Significant amount of internal IT

support and involvement

Software as a Service (SaaS) Rapid deployment

Lower cost of ownership

No shelf ware – pay for software that

is used

Buy license and have it hosted

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Things to Remember….

• There is no simple or

correct answer

• Build, buy, or rent options

• General rule of thumb - rent

a proven solution from a

proven supplier

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About KeyedIn Consulting Group

Experts providing solutions to specific problems

– Enterprise Software Selection

– Project Rescue

– Project Management & PMO Managed Services

– People and Process Alignment

– Business and IT Alignment

Follow KeyedIn

Corporate Website: www.keyedin.com

www.twitter.com/keyedinsolution

www.linkedin.com/company/2434133?trk=tyah

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Free Whitepapers

Download

@

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Upcoming Webinars

Register at

www.keyedin.com

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7/12/12 How to Successfully Engage Software Vendors & Their Software

7/17/12 Business Processes: Can’t Live With ‘Em, Can’t Live Without ‘Em

7/19/12 Support for the New System: Go Live Is Just The Beginning

7/24/12 Selecting Consultants: Just Like A Marriage–For Better Or For Worse

7/27/12 Enterprise System Implementation Strategies and Phases

7/31/12 Project Teams: People Issues, Roles and Responsibilities

Questions & Answers

Q ACopy of Presentation Future Webinars

Contact:

Shelly Bird

sbird@keyedin.com

952-835-1041 ext.163

Visit:

www.keyedin.com

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