Unlocking cost savings: leveraging contract workers for SAP implementations
Implementing an SAP system is a transformative yet challenging initiative for any organization. With its ability to integrate core business processes and provide actionable insights, SAP solutions can offer a significant competitive edge. However, the journey from planning to go-live can be a costly affair, particularly when engaging high-priced consulting firms to manage the implementation. For companies looking to maximize value without stretching budgets, hiring contract workers is most certainly worth considering.
The high cost of traditional consultants
Traditional SAP implementation often involves hiring large consulting firms. While these firms bring expertise and resources, they come at a premium. Consultants from such organizations can charge between $200 and $500 per hour or more, depending on their expertise and the complexity of the project. For long-term projects, these costs can quickly spiral out of control, consuming significant portions of the implementation budget.
Additionally, watch out for consulting firms that bundle services, meaning you may pay for resources or capabilities you don’t use. This lack of flexibility inflates costs.
The case for contract workers
Contract workers provide a cost-effective alternative. These independent professionals or small firms bring specialized expertise in SAP implementation but without the overhead costs associated with large consulting firms. Here’s four ways they drive savings:
- Lower hourly rates: Contract workers typically charge significantly less than consultants from large firms. Depending on their experience and geographic location, contractor rates translate to substantial savings over the course of the project.
- Targeted expertise: Contract workers often focus on specific aspects of SAP, such as system configuration, data migration, or user training. This allows you to hire only the skills you need, reducing unnecessary spending on all-inclusive consulting packages.
- Flexible engagement models: Unlike consulting firms that may require long-term commitments, contract workers can be engaged on a short-term or part-time basis. This flexibility allows you to scale your workforce up or down based on project phases, minimizing idle time and associated costs.
- Direct oversight: Working directly with contract workers often eliminates the middleman, streamlining communication and improving project efficiency. Without layers of bureaucracy, you can better manage scope and timelines, avoiding costly overruns.
How it works: cost savings in action
Consider a mid-sized widget company planning a global SAP rollout. The company received a quote of $5 million from a consulting firm for a 12-month implementation. After evaluating alternatives, the company decided to hire contract workers for key roles, including a project manager, SAP module experts, and a data migration specialist.
By assembling a team of skilled contract workers, the company reduced labor costs by 40%. Additionally, the flexibility to adjust team size during different project phases further enhanced efficiency. The total implementation cost came in at $3 million—a savings of $2 million compared to the original estimate.
Where to start?
Leveraging contract workers for SAP implementations offers you a compelling way to balance cost and quality. By tapping into specialized expertise, embracing flexibility, and maintaining strong project governance, you can achieve your SAP goals without breaking the bank.
Let Addison Group provide you with the skilled SAP contractors for your project. From data migration to process optimization, we guide our clients through every step of the process. No one gets talent like Addison Group.®
