Quantifying the cost of doing nothing

A recent client meeting reminded me that we often focus on the cost a project and its ROI yet forget the cost of doing nothing at all. 

For example, I received a request from a customer to estimate the cost for their customers to order online, check on inventory availability, pricing, etc.  For their environment and needs, I determined the cost to be approximately $15,000 to implement the technology to allow their customers to have this "self service" capability. 

$15,000 may or may not initially sound like a lot of money to spend on this type of project.  But is it?  In their case, they didn't feel they would have enough of an increase in sales to justify the ROI.

A fair question is: what is the cost of doing nothing?

If one of their customers that annually purchases $250,000 of their product at a margin of 20% leaves them for a competitor who has the 'self service' capability, the cost of doing nothing is $50,000.  Additionally, instead of needing four customer service personnel to handle the incoming calls from customers they could reduce that to three, increasing the 'cost of doing nothing' $30,000 to $40,000 plus benefits.

Whenever you determine the cost of doing any project in your company, be sure to consider the cost of doing nothing in your ROI.  Many times it is a forgotten and significant portion of the equation.

Selecting a New System Success Stories

Chortek LLP's Technology Consulting team recently completed system selection engagements for two of our clients.  The first was for an existing client using Sage 100 which had looked at a service industry enhancement five years ago as well as an industry specific solution that was deemed too expensive.  After evaluating the options and return on investment, they recently chose the industry specific solution since it met all of their needs. It was designed specifically for their industry verses trying to make an add-on work for them at a lower cost.
In the second engagement, the client initially had a good grasp on the solution they were going to choose but after careful documentation of requirements and evaluation of various manufacturing specific software vendors, they found a different solution that best fits the way they do business.  The process allowed them to see their real needs, the options available and while many manufacturing software exists, only a few met their specific needs and one clearly stood out as the best fit.

Chortek LLP's Technology Consulting team specializes in helping businesses find the right software for their needs.  Contact us or visit our website for more information on selecting a new ERP system.

Recent SageCRM project: workflow automates complex sales process

Chortek recently helped a client create a workflow in their SageCRM system to automate and manage a complicated sales and customer service process. 

The client gave us a handwritten sketch on a piece of paper that outlined their process for handling a custom fabricated part:

1. Ordering a sample from a fabricator
2. Quality checking the sample against the customer's specifications
3. Returning it to the vendor or shipping it to the customer based on the pass/fail
4. Once the customer approves the sample, ordering the production parts from the vendor and ultimately shipping the parts to the customer.

Working interactively with our client, we built a workflow in SageCRM that guides their employees through the process, notifies the relevent team members when appropriate, and gives everyone visability of 'where things stand' at any point in time, ensuring that nothing falls through the cracks.

Contact us today to discuss how we can help you automate your business processes!

AICPA 2013 Top Technology Initatives

The AICPA (American Institute of Certified Public Accountants) has released the results of the 2013 Top Technology Initiatives Survey:

1. Managing and retaining data
2. Securing the IT environment
3. Managing IT risk and compliance
4. Ensuring privacy
5. Managing system implementation
6. Preventing and responding to computer fraud
7. Enabling decision support and analytics
8. Governing and managing IT investment/spending
9. Leveraging emerging technologies
10. Managing vendors and service providers

If you have any concerns in your organization regarding these items, Chortek LLP's Technology Consultants can assist you with addressing your needs.