Choosing Between Embedded or Standalone Configuration Technology for ETO Companies

Engineer-to-order (ETO) companies create value for their customers by putting specialized expertise, innovative engineering, and project manufacturing operations to work. However, many ETO firms are not yet taking advantage of the best of modern business management technology. In this series of blog posts, we consider several pressing industry issues and discuss how Sikich can help ETO companies get ahead by deploying Sikich HEADSTART for ETO, a business management solution based on Microsoft Dynamics 365 Business Central.

Recently, we described the digital lag in the ETO industry and gave highlights of the capabilities and benefits of Sikich HEADSTART for ETO. Today, we dive into the software configuration conversation.

Product configuration capabilities can be business-critical

You can acquire configuration functionality in form of a stand-alone software product or as one component of a solution like Sikich HEADSTART for ETO. When it comes to configurators, ETO and configure-to-order (CTO) companies are often tempted to purchase more configuration functionality than they require, similar to how they acquire ERP software. Solution vendors offer a number of excellent configurators, and Sikich will deploy a configurator together with an ERP solution when that makes sense. However, the software can require a large up-front investment, and scripting the logic rules for it and managing it within your ERP environment will require time and skills you either need to own or contract for. In many companies, it takes the equivalent of one full-time, skilled employee to manage the configurator software. We may be able to help you avoid those costs and complexities.

Hidden costs of configuration software

At Sikich, we have seen too many situations where companies purchased a configurator and never got around to creating the logic for it. As a result, the software languished without bringing value to the business, and sometimes users and IT practically abandoned it. If your product is mostly standardized and repeatable, but contains a subset of components that you customize for individual customers, configurator software may not be called for. HEADSTART for ETO will most likely be a good fit for you. Your team members can do their jobs and manage projects within a single solution and won’t have to learn and navigate multiple systems. However, if every one of your products is a customized combination of possible options, you may be better served with a high-end configurator.

Clients sometimes tell us that they acquired configurator software because they wanted the best possible tool to facilitate product configuration. Stakeholders and consultants may argue that a company’s needs may change and become more complex, and purchasing advanced configuration software beyond what is currently needed can be a kind of future-proofing measure. However, for most companies, these highly tentative benefits will not justify the expense and administrative overhead of a configurator system. What makes more sense for them is matching technology to the workings of the business.

Right-sizing your configuration functionality

A Dynamics 365 ERP environment in the cloud can flex and scale to include extended functionality on the same platform. Sikich clients have saved costs, reduced administrative workloads, and still gained the right configuration capabilities by deploying HEADSTART for ETO. Our solution can pencil out favorably even if you decide to replace your existing, overly complex configuration tools and start over. For companies that have invested in configurator software and find that it requires too much time and effort from IT managers and business users, Sikich can help achieve a turnaround that provides exactly what the organization needs.

Some recommendations regarding the choice of configuration software vs. using the configuration capability that comes with your ERP system:

• Be sure to have an in-depth conversation with your consultant about this important issue. Your technology partner should be able to help you assess your requirements and make a sound case for either solution.
• Engage with consultants who can offer and support a range of solutions. Consultancy-based advisors who only have configuration software in their arsenal will not be able to recommend anything else. Sikich can help ETO companies with either configuration software or the best choice of an ERP system that comes with configuration functionality. Your business needs and such requirements as having to support customers making configurations online should drive the decision.
• As mentioned, if your engineering team repeatedly rebuilds the same components while leaving the rest of a product unchanged, HEADSTART for ETO will likely be the right fit. However, if every new product requires new engineering design from the ground up, you may be better served by configuration software.

The next step

If you want to have an exploratory conversation about our solution or arrange for a demo, here are some next steps:

• Read the previous and following blog posts in this series:
  • Technology modernization comes to the ETO industry
  • An ERP solution tailored for ETO requirements
  • Why should ETO companies rely on CRM software?
  • Future-proofing your ETO business management technology
• Download our full ebook, How CROs Can Deliver a Superior Client Experience, for free.
• Contact the Sikich team.
• Watch a video about some capabilities of HEADSTART for ETO on our YouTube channel.
• Learn about Sikich CRM and ERP services.
• Follow us on LinkedIn, Twitter, and Facebook.