To ERP or Not To ERP?

Worth & Co., a Pennsylvania-based manufacturing company decided to implement an ERP from a well-known software vendor in 2014. First scheduled go-live date was November 2015, which was then pushed back to February 2016. At that point the software giant demanded that Worth & Co. pony up $260,000 for training courses and support contracts. But 2016 came and went and still no rollout. After switching to another IT vendor, Worth & Co. spent another year attempting to implement the system without success.

The relationship ended up in a lawsuit in February 2019. Worth & Co specifically cited the $4.5 million they paid the software giant for licenses, professional services, and training. The lawsuit is still ongoing.

What does this, plus many other, sad ending relationship tell us?

ERP systems are a great invention, but that doesn't mean the systems are great for everyone.  

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A brief history of ERPs

Enterprise Resource Planning (ERP) emerged in the early 1990s and were first used by manufacturers to keep all aspects of the manufacturing process in one place.  

Today ERPs are fully integrated systems that connect every department and all aspects of a business in one place. Modern ERPs provide a company with a real-time tool that runs a single, shared database of information, which can be accessed by every department in an organisation.  

ERPs for the Construction industry

ERP software systems for the construction industry have been used to deliver core capabilities across areas such as finance, accounting and risk management.  

However, construction is a unique multi-faceted business, and has many needs that other industries do not. Aspects of the construction cycle such as cost controls, risk management and overall project health require specialised processes and tools that a standard ERP solution cannot accommodate “out of the box”.  

In fact, many owners and PMs in the upstream space have found their increasing business needs outgrow the technology they chose to manage their system from the start. Most often they find the standard ERP systems are not customisable for some specific needs on higher levels of their capital works. So many owners end up looking for a more cost-effective, easier-to-use solution that will complement the missing gaps in their ERP.  

Here are some other reasons why owners frequently look for built-for-purpose delivery systems such as Mastt.

1. ERPs are too complex

Owners and PM consultants of large capital works portfolios often shift to ERP when thousands of spreadsheets containing program and portfolio information become too difficult to manage. Fair enough.

But there are many cases where ERPs don’t go exactly as planned. The transfer of old data into the new system is an often-underestimated aspect of a successful ERP implementation. Deploying an ERP requires significant communication between the IT department and users, not just at the requirements stage, but after deployment as well.  

Cloud deployment has made ERPs easier to implement and to maintain. The cloud, however, is unable to solve the core problem with ERP systems. They are still large complex systems requiring major organisational change in order to get value from them.

The objective of bringing in any technology into the workflow is to minimise the effort while maximising the value to the business. If a system requires you and your team to work hard just to ensure it is up and running, maybe it’s worth thinking twice before bringing it in.  

2. ERPs are not easy to customise

While ERPs give a broad view across the entire business, they only meet an organisation's lowest common need for a centralised data system.  

ERP systems have a reputation for offering a one-size-fit-all solution to business problems. Most of the time, companies end up buying a whole suite of software that isn’t needed which increases cost for no added benefit, forcing them to find workarounds to meet unique demands.  

Construction businesses do use ERPs to manage project costs, but most of these functions have been built for generalist use-cases and haven’t been custom built for the upstream construction industry.

3. There are much better built-for-purpose alternatives available

There are many alternatives to ERPs that are specifically tailored for the construction industry in the market.  

Capital works & infrastructure portfolios in particular need to be able to respond to fast-moving changes to data at the drop of a hat to stop cost blowouts or time delays as soon as possible. The only way to get real-time responsiveness and be a data-driven capital works portfolio is to use a Machine Learning platform.

While ERPs can get extremely complex, capital works program management platforms such as Mastt is easy to get started, without the need to do a massive tech implementation to get going.  

Mastt was born out of a project manager’s years of experience in the Capital Works PM space. Having to deal with complex spreadsheets or series of spreadsheets in the past and having seen them break all the time, inspired Doug to build something better. Mastt offers a more intuitive software product precisely because it’s been designed by an Owner’s project manager with other project managers in mind.

Not just a shared database of information, Mastt’s powerful Machine Learning system is able to:

• Analyse structured and unstructured data within and across projects to discover trends
• Predict outcomes
• Improve decision-making in a portfolio  

On top of that, the system also lowers ongoing cost, because you are getting just what you need, not a full suite of tools that are never touched. Instead of waiting for months, or even years like in the case of Worth & Co., it only takes a few weeks to implement.

If you’re interested in speaking more with us on this topic or looking to set up a data-collection system for your organisation, contact us on hello@mastt.com  

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