Thinking the whole when making decision about your ERP development projects

Buildings

As a product manager you quite often find yourself thinking development priorities. Marketing and sales want’s something, business management wants something, technical people wants totally different and list goes on. Addition to the needs you need think about your capabilities.

I already wrote in my previous post how to use the Kano model for prioritizing. Because the Kano model mostly focus on features I wanted to expand my view. The key is to think needs and capabilities as a whole. In this post I give a quick overview to how I have grouped and analyzed needs and capabilities. Based on that I’m able to create better development priorities for my team and communicate those to all stakeholders.

So what point of views to consider when deciding priorities for  development projects? I divide question to three sub questions.

  • What kind of business you are running,
  • what’s your position in existing markets and
  • what kind of resources you have?

How your business model affects to your product development priorities?

Roughly there can be two business models for software development. Revenue comes either from product licenses or from software projects. If first is important then it’s necessary to put focus on product features. If the latter is more important then it’s better to develop tools or methods which help you to deliver quality projects. Usually you belong somewhere in between those two models.

Businessmodel

What about markets?

As I wrote in my previous post you need to have basic features and something to keep your product competitive. To make good decisions you need to analyse your position in markets and understand what’s important for your product.

Last question was related to resources

There is two main resources needed. First you need to have the money to do the product development. With the new ERP product it’s usually an external investment which makes it possible to do needed development. When the sales are ongoing activity then part of the revenue can be pointed for the development.

Addition to the money you need skilled people. Without experts it’s difficult to arrange a quality development. There is also interesting connection for the business model: If you own your product then you usually have a deeper knowledge (domain-, product- and technical knowledge) to develop the product.

The point: Think the whole and make decisions

I have mentioned three things which I have needed to consider when thinking priorities for the ERP product development. If  I wouldn’t do this I could end up to situation where I promise features which my team can’t deliver or for which I don’t have money. Or I could promise something which really don’t give value for my business model.

Decisions

When thinking your context, you might find more.

Developing your ERP product features

ERP is a business management software – usually suite of integrated applications – that company can use to store and manage data from every stage of business, including: product planning and development, manufacturing, marketing and sales, inventory management, shipping and payment. (wikipedia)

With the ERP software a company can steer its processes, collect data and optimize needed functions. The ERP usually is platform where other IT systems are integrated.

As well as other products ERP applications needs a continuous improving during its lifetime. The need for the improvement is different than for example consumer product. Need for new features comes usually from:

Why new features

The same needs applies to many other industry software as well.

Where to get ideas for development

I have found it rather easy to gather ideas for development. You can get ideas from

  • Customers
  • Your team
  • Competitors
  • Platform vendors
  • Sub-contractors

Working with all of these groups gives to you a long list of things to do. After you have the list then it’s still good idea to mix things and getting even better ideas. This means getting customer needs to the same table where your team ideas are and so on.

When collecting ideas remember ruthlessly seek customer needs and match those with solutions. And, of course, check that you are able to do profitable business with ideas. You can use a Vision Board as a template to capture ideas.

How to know what to develop?

As the ERP software is quite large by its nature you will need to do difficult business decision about improvement priorities. Which ideas to select for development? I have found useful to use a Kano model to group needs and try to predict what would be the most valuable thing to build next. It also gives for you a nice context to analyze current market trends.

Kano_Model

This is a file from the Wikimedia Commons

Basic needs: You need to have these. With ERP applications this can mean for example mature core without bugs or possibility to integrate 3rd party systems. In time things which use to be delighters starts to be basic features. Without basic needs implemented you will be out of the business.

Delighters: With this group you can differentiate your product in markets. It can be based on some technological innovation or creating tools which gives to your customer in their business competitive advantage. In time competitors will reach you with your deligthers so you need to have continuous innovation. Currently there is going though competition to delight users with smart phone and tablet applications. After some time this kind of mobility will be basic need for ERP applications. Without delighters your sales will have difficult times.

My advice is to look closely to two things: how do you differentiate your product in markets and which features become standard needs for customers.

(Check also my newer blog post Thinking the whole when making decision about your ERP development projects to find out wider angle to prioritizing.)

Conclusion

ERP development has its own specialties. It’s clear that there is need to develop software during it’s lifetime and needs are not the same as for example consumer products.

It’s rather easy to get ideas but more difficult to know to what to build. You can use Kano –model to analyze to which direction you should develop application. Remember to be consistent with the direction.