Cubic Corporation invested in an ERP system to streamline operations and improve profitability. More than two years later software and implementation costs are over $61 million and climbing. Is this another ERP boondoggle?
Based in Southern California, Cubic Corporation is a public company that operates in the defense and transport industries. In February 2015 the CEO announced steps to streamline operations and improve profitability, which was expected to yield about $16 million annualized pre-tax savings in the financial year 2016. This would be about $160 million savings over 10 years.
The ERP project was started in late 2014 and was expected to be completed by the end of 2015. But as of mid-2017, the implementation was still going strong. Based on published financials, as of March, 2017 Cubic had spent $61 million on the project so far. With completion currently estimated to be in 2018 (assume Q2) and extrapolating implementation costs, Cubic will have spent a total of about $86 million on their new ERP software project by the time it goes live.
Successful enterprise software deployments are not as common as they should be, and deployments where the ROI exceeds expectations are rare. This case study examines how Profil Institute for Clinical Research used Wayferry to select a VoIP call center in the cloud, greatly exceeding the anticipated ROI.
Profil had an urgent need to improve their process for recruiting clinical trial subjects. Because this is not a service like sales or tech support, Profil's requirements were not typical.
The Software Selection Project
After the initial meetings to define project scope and get an overview of the needs, Wayferry identified 29 potential call center products.
Pennsylvania Turnpike Commission implements ERP only to end up in court. A case study on reducing enterprise software risks.
Previous articles have examined techniques for evaluating and selecting best-fit enterprise software. This article draws many of those ideas together using the example of a software selection failure currently in the courts.
The Pennsylvania Turnpike Commission hired Ciber to develop an enterprise software RFP covering finance, payroll, human resources and so on. They awarded the implementation contract to Ciber without taking bids. Now they are suing Ciber for more than $45 million, alleging the company overbilled while implementing software that doesn't work properly.