Ryman Healthcare is a publicly listed company that operates 24 retirement villages around New Zealand, with two more under construction and two others in the planning phase, and is soon to commence work on its first development in Australia. It was awarded Best Growth Strategy in the 2011 Management Magazine Top 200 Awards and is a consistently high performer on the NZ Stock Exchange.Read the full story
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New software: The cost isn't everything
“It’s exasperating when a project gets hijacked by the cost component, and to be honest, many vendors get away with selling on price, whatever the value aspect might be.”
Tim Ryley, a director of Greentree Partner Endeavour Solutions, is used to punching above his weight.
Not long ago, he took part in a charity boxing match, spending months training hard in order to raise funds for Koru Care.
“I was TKO’d in the second round,” he says. “It was a fierce physical exchange, and I was struggling to defend. The guy was taller, faster and younger than me. He was able to load punches up without any break for quite some time, and I wore a few of them.”
Tim also leads with his chin when telling businesses the truth about their system requirements. He’s seen implementations go wrong through lack of planning, unrealistic expectations, and plain lazy thinking.
A common problem is the tendency of customers to get focused on the cost of the software alone. That’s a short-sighted approach.
“I’ve often seen customers who will decide on one product or the next based on a $10,000 difference in the licence cost or less than 10% of the project cost,” Tim says. “What’s more, I know there are vendors out there who’ll let that happen.”
“It’s exasperating when a project gets hijacked by the cost component, and to be honest, many vendors get away with selling on price, whatever the value aspect might be. It’s the lazy option, and it’s worse if the customer gets sucker-punched into playing that game.”
Buying yourself a battle
One major problem that can get overlooked if the capital cost is the sole focus, is whether the staff have the skills required to use the new software. If they don’t, the company can end up with a lot of wasted time and extra expense, catching up on issues that should have been resolved before the new system even went live.
Tim cites one client which was already using Greentree for financial and inventory management, and decided to implement a full production management system. They failed to acquire any more skills or resources inside the business, to run a larger and much more complex set of functions.
“They’ve struggled. They haven’t got anyone in there who has the experience in the past of what’s required. They’re very limited in their capability, and it’s making it very difficult for them to actually get the outcomes that they want.”
In a bid to avert such calamities, Endeavour has not only quizzed prospective customers about their internal skills and resources, but has even steered people with the necessary skill and experience towards the client – in two cases they’ve become full-time employees.
“Smaller businesses needing to expand should first investigate their HR situation, and the partner should help them bridge the knowledge gap of what they’re going to need, to deploy it and to run it on an ongoing basis, and to get the benefits from it,” Tim says. “Otherwise they risk knocking themselves out.”
About Tim Ryley
Tim Ryley is based in Christchurch and when not working, enjoys swimming and mountain biking. He has retired from the boxing arena.