When selecting a Manufacturing Execution System, there are two broad types of Manufacturing Execution System (MES) implementations:
- A custom built MES configuration based on an MES tool kit
- A Commercial-Off-The-Shelf (COTS) configuration of MES software
These two flavors of implementations come with different variations of risk. In this video series we identify the top 5 risks you need to know, this video focuses o, Budget Risk.
With companies operating with tighter budgets, it is becoming more critical to manage costs throughout the entire implementation, not just the cost of the software licenses. Buying a software can be an expensive proposition if you underestimate the actual work required in services to make the software operational.
Custom built MES configurations based on MES tool kits can run high ratios of license-to-service dollars, often times upwards of 1:5. That means for every $10,000 spent on licenses, you may actually be spending $50,000 in services. With a COTS MES solution, the ratio can drop dramatically to the range of 1:2. It is important that the comparison of various solutions includes both expected license and service costs to get a more accurate pricing estimate. And don’t forget to account for the additional cost of managing the software production lifecycle for the custom solution as the toolkit and platforms require more upgrades.
Watch the Rest of the Series:
#1 Budget Risk (current video)