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Advantage ERP: Risk, Quality Take Center Stage in Post-Recession Growth

by Dave Hannon

July 1, 2011

By Dave Hannon

@Daveatwispubs

Suddenly there is a lot of talk about quality and risk management as growth strategies lately. I know, weird, huh?

It would appear that as companies continue on their path towards increasing growth, their strategies hinge on a solid foundation of quality and risk management. Companies aren’t just thinking about where the next sale will come from – they’ thinking about where their next decade’s profits will come from. And they’re working on implementing processes and programs to support those strategies now, before their business activity speeds up to pre-recession breakneck speeds.

Case in point: according to a recent survey of CEOs from the Conference Board “global executives report that the quality function is uniquely positioned to accelerate growth through better execution and alignment. Quality also provides the voice of the customer that is critical for developing the innovative products and services that will sell in the marketplace.”

Clearly, today’s CEOs don’t think of “quality” as their predecessors did, says the report. We’re not talking strictly about reducing defects in PPM or meeting regulatory minimums. CEOs today link quality closely with process and strategy. In fact, one of the CEOs’ priorities listed in the report is “strengthening end-to-end process management, sys tems thinking and agility.”

Are you thinking what I’m thinking? When it comes to “end-to-end” anything, ERP users have a major advantage. (There’s even evidence in this Capgemini survey that the IT organization is increasing its emphasis on quality and investing more in QA this go-around).

And risk management is no longer a “what if” strategy, but a “must have” strategy to drive growth. According to a recent Accenture survey, 85% of executives said risk, in fact, has become a driver of competitive advantage for their company. And 49% believe that corporate risk management will enhance the likelihood of long-term profitable growth for their company.

Companies with a mature, integrated IT environment will have a leg up here, as well. The Accenture report points out that: “For all risk organizations the top five challenges in the next two years will include: reducing cost, aligning risk management with the company’s overall business strategy, responding to regulatory demands, improving risk measurement and improving modeling and data management.”

These challenges benefit from a centralized ERP system like SAP that can put structure to new processes and facilitate data-sharing and analysis.

Once this recovery has run finally come about, it will be very interesting to see how ERP vs. non-ERP companies fare.

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