FIVE QUESTIONS FOR VOLKMAR MOHS, HEAD OF SOFTWARE SOLUTIONS (SWS) AT CHG-MERIDIAN
Head of Competence Center Software Solutions
Tel.: +49 89 23 88 56 312
Mobil: +49 160 71 34 839
ERP launches are often unsuccessful. There are many different reasons for this. How can CHG-MERIDIAN contribute to raising project security?
VOLKMAR MOHS: Companies don’t launch new ERP software every year. So it’s no surprise that companies do not have the various skills required on hand. The difference at CHG-MERIDIAN is that we’ve carried out such projects so many times already that we’ve mastered their complexity in every facet. This results in a clear pledge of value for our customers: we increase project security and at the same time reduce costs.
You reduce costs? How do you do that, specifically?
VOLKMAR MOHS: Throughout the software lifecycle there are a whole host of areas in which we reduce expenditures and cut costs. This begins with professional support in the software selection and a commercial review of the supplier contracts. It’s also important that the ERP project is structured according to license and tax laws. We frequently find huge potential for savings when it comes to license costs in particular.
In one recent case, for a leading manufacturer in the aviation and rail vehicle industry, we were able to reduce the total costs by 15 percent through a wide variety of individual measures.
Software leasing is still an unusual form of financing for many companies. What are the advantages?
VOLKMAR MOHS: There are, of course, the numerous advantages that we know from leasing. Neutral balance sheets and maintaining liquidity, to name a few. Our financial expertise pays off in particular as regards the impact on balance sheets, which can be substantial in an ERP project. And this is especially the case when it comes to balancing the accounts on an international scale. If you do everything right here, at the end you will have better company figures and lower-cost outside capitalization overall for your company.
…but the hidden costs are generally the most dangerous cost drivers in a software launch?
VOLKMAR MOHS: Yes, that’s right. In an ERP launch, many think about the software and license costs first of all. But these are only part of the total costs. There are also implementation costs – i.e. expenditure for consultants, systems houses and travel costs. And on top of this are the customer’s internal human resource costs. What many companies don’t know is that these internal costs must be activated and amortized as additional acquisition costs for an ERP project. And this applies to all employees involved in the project, even temporary employees. We cover all of these cost blocks in our financing and integrate them into one lease fee. This is a huge advantage of our financing concept.
Is the Software Solutions area new for CHG-MERIDIAN?
VOLKMAR MOHS: No, we have been active in this field for a long time. We provide integrated investment support from a single source – along all stages of the technology lifecycle. If, for example, you virtualize your data center, you must ensure that you’re not suddenly paying more for new database licenses than you’re saving in hardware costs. The greatest potential to make savings in IT budgets lies in the effective and efficient use of software products. This is why our expertise in alternative licenses and other matters of license management are so valuable for our customers. But to answer your question specifically: we’ve been supporting our customers in software matters for many years already. Only now, we’re starting to actively communicate this to the market.