Many businesses love their old software and do not want to change them.
buy a cheap Accounting or an ERP software that meets their business
requirements when they were making USD 1M. Now they want to use the same
and make it run as the business has grown to US$10M. As their business
need changes to meet Sales demands or CRM needs, they buy additional
software and spend huge money to integrate the new technologies to their
old Software. Because they are not able to see the future growth and do
not purchase a FUTURE ready ERP software.
The challenge they do
not understand is, they spend huge amount of money to run the old
software, they keep IT personal to run and manage their hardware and
server etc. This would lead to loss of business opportunity as the old
solutions are not integrated together affecting customer services.
as part of our cloud ERP software sales, we met a US$100 million
manufacturing company in India. During our discussions with the company
management, we were sure that they are interested to go for a Cloud ERP
Solutions. But the challenge was “can we customize the product to suit
their business practices and needs?”.
management wanted to retain and follow their 30 year old practices where
they manually check the data, numbers even after these are generated
from their current stand alone ERP. They wanted controls and approval at
every stage of documentations.
They were in dilemma,
because their business had expanded and had operations in 3 large
locations. But they wanted to continue with old practices as they are
afraid that their “Old workforce” can’t manage the pressure. They don’t
want to change the legacy of the company Founder too.
It gave us an opportunity to think what is happening here and our findings were as below.
1. Old practice:
When the Founder started the business, he wanted to control every
document movements and approved by him. It is OK as that time where the
taxation rules were stringent, getting bank loan was difficult and
Information / trade secret should be kept under wrapped. But as the
business grown they added more people to do the manual document
preparation and built “verification layers”, but didn’t automate the
process and remove the old practices.
2. Fear of Unknown:
Many senior employees worked as assistants to the Founder and gained
his confidence and were promoted. The loyalty and “fear of unknown”
didn’t allow them to change the old practices. They followed “Boss is
always right” model.
3. Don’t fix anything unless it is broken:
They didn’t make any attempt to know what is happening around the world
and they didn’t trust anyone. This was the problem as they never sought
after some of the best practices around the industry and made an
attempt to practice and follow. They have an ISO9000 certificate, as it
was essential to get the large company orders. They strongly believed
that they follow a “World class practice”.
4. Resources Cost is cheap,
but now it is affecting the organization as the current Workforce did
not follow the level of commitment and loyalty that was exhibited by
5. New generation is looking to change the current practice,
but are overruled by their parents who are more “experienced”. So many
young generations are forced to follow the old practices, as the senior
workers never listen to them.
6. Data duplicity and entries were high as their current system is a combination of multiple solutions that are decentralised.
Founders and their family could not penalise the old workers even
though they miss the deadlines or missing the compliance rules as they
were loyal to business and had grown with the business.
analysing the above, we suggested the following with justifications.
Because it is essential to be empathic to customer needs and see how can
we help them?
“We are happy to customize the ERP to suit
your needs. But, before doing it, you should run our ERP “as it is” for 6
months. Post that we will take a decision on the next steps to follow”.
We justified this on why they should go for
automation of an ERP and not to customize it to follow their old
practice with below points.
1. A world class ERP solution
brings some of the best practices used across the world. This could
help them to improve the productivity, reduce wastage and improve
2. Cloud ERP brings in process automation,
control and meets compliance needs as it is. No more last moment run and
miss the compliance deadlines and pay a penalty.
3. It reduces the chaos and simplifies the process.
4. It brings in clarity to the process and Business Owners can see the right details at right time.
Competition is increasing day by day and Businesses need to be ready
with right process to win the customers. Customers are the decision
makers now as the information is freely available to everyone.
Government Rules and regulation have become stringent. Every county is
co-operating with each other to find tax evaders. So it is not advisable
to keep the Oral records or miss the bookkeeping.
7. Just because they are following a process for many years doesn’t mean it is correct now.
In summary, we won the deal being honest with this prospect and implemented our Cloud ERP Software as it is.
Before starting a Cloud ERP Solutions, I worked with software industry (Enterprise Resource Planning (ERP), Banking and Treasury Software products) for 20 years.
Personally I do not agree to the software product licensing
concept where OUR product is licensed to a customer to use it and in
turn we make him an “IT Expert” to manage OUR software, take OUR
database backup on his HARDWARE rather than RUN his Business for which
he bought OUR software. Irony is, he PAYS money to TEST and IDENTIFY
Bugs in OUR software and we collect the money as “Annual Maintenance
So we developed a cloud solution, AcTouch.com, where
customer has an option to use the product while we manage all software
upgrades, regular DB backups and make sure that he runs his business
without any problems.
I normally write about MSMEs and their pain points that I encounter during my interaction.
Everyday I learn from MSME Business Owners.
am an alumni of INSEAD Business School with a mechanical engineering
background and this helps me to understand the business problems and