Are you trying to get a project off the ground to improve your CapEx approvals, but are receiving pushback from senior executives who are reluctant to sign off on the budget needed to implement capital expenditure software?

In this blog, we’ve compiled a list of the most common objections we’ve heard alongside some tips on how key stakeholders can ease the concerns of senior executives.

#1 We have no budget

Undoubtedly, the most common objection in any negotiation is price, both in terms of the initial upfront investment (consultancy, development, training, etc.) and ongoing software licensing and support.

However, have you considered how much it will cost to do nothing about your manual processes?

If you retain existing working habits, you will continue to experience lengthy approval cycles, limited visibility, and poor governance.

Furthermore, by not having a centralised process, those same senior executives have no visibility of how things are being approved, and how money is being spent. This combined with poor governance of the process itself will lead to additional costs, across the entire organisation, eclipsing the cost of a central IT system.

And don’t forget, for publicly traded companies, ensuring documented, enforced, and auditable process for approvals is not just a nice-to-have, it is mandated by law!

Finally, that centralised visibility can be granted to procurement, so that they can find opportunities to group-buy or negotiate better rates, further saving money.

#2 We already use spreadsheets and email

A common refrain we hear is “we’ve always done it this way” or “it ain’t broke, so why fix it?”

However, while spreadsheets work on a small scale, they become increasingly difficult to control as organisations grow, either organically or by acquisition.

At this stage, we point out that the organisation would not have invited us (and other suppliers) to demonstrate eCapEx without knowing deep down that their existing processes were far from ideal!

We understand that implementing software means letting go of ‘old habits’ and trusting something new and unfamiliar. And it may be comforting to stick with what you know and how you currently work.

The desire to maintain the ‘status quo’ is understandable, yet automating CapEx approval processes can deliver significant benefits and provide near-immediate process efficiencies and return on investment.

A good antidote is to ask your vendor to deliver a proof-of-concept to reduce risk and cost. This will deliver a quick win for the board of directors to review and allow for a more agile approach during the early stages of adoption.

Vendors should also provide comprehensive onboarding to users to ease the transition. This should include hypercare in the first few months as well as training and ongoing support.

#3 We use our ERP system for CapEx approval

Sometimes we are told that an organisation can utilise the financial management modules inherent in an ERP system for capital expenditures.

However, customising an ERP system to fit your CapEx requirements can be challenging, and you may need to adapt your processes to fit the ERP system.

For example, while these systems may support setting project budgets and cash flow management, they do not have the right workflow capabilities to manage approvals.

Initiator access can be another challenge, both in terms of cost for additional user licenses, and also for the training required to navigate such enterprise class platforms. Suddenly, your user base goes from finance and management users, down to any department head or employee who can raise a CapEx request.

Conversely, with native connectors for SAP, Microsoft, and Oracle, eCapEx streamlines the CapEx lifecycle from budgets and requests to approvals and post-investment review; all tailored for you by our expert team.

#4 We don’t have the internal skills

A lack of skills or internal resources is often cited.

However, if your team is achieving its tasks, it is probably using some form of workflow. It may not be with CapEx management software, but there is some routing and decision-making that follows a prescribed order.

The point is you already have the people and skills within your organisation to plan how your process needs to work and the data you need to collect.

As long as you choose a good vendor, they will be able to handle the technical aspects of building and configuring the system, allowing you to sit back and await a delivered, turn-key CapEx solution.

Additionally, capital expenditure management software enables business users to build request forms, approval workflows, and user interfaces with no-code tools, so you can participate in the build process if you desire.

#5 We have lots of legacy and home-grown systems

Another barrier to adoption is working with internal systems.

Legacy IT systems are sometimes inefficient, inflexible, or require constant support to prevent security breaches or cyber-attacks. However, many companies we speak to are reluctant to replace existing systems due to the cost, complexity, and risk associated with the project.

Modern CapEx software includes APIs to enable applications to exchange information with each other for a better view of organisational data, so it is not always a case of replacing entire legacy systems, but identifying what data needs to flow between them. But sometimes even basic integration with legacy systems is not possible!

The counterargument is that with modern systems, especially cloud hosted platforms, there is no impact on legacy systems if you don’t want there to be. Systems like eCapEx can be completely stand-alone, if that’s what you need.

#6 We think cheaper options exist

Sometimes, we are told there are cheaper products available.

SharePoint is a commonly cited example.

SharePoint is an excellent information and document repository, but it cannot effectively apply business rules, supply adequate governance capabilities and, most importantly, it requires the work of a team of software developers and administrators to manage all but the most basic functionality effectively.

It’s simple for basic requirements, and with the right development skills and resources, it can be very powerful, but in the middle-ground, where you want something quickly to perform a relatively simple, but sometimes detailed and tailored process, it fails to deliver.

Conclusion

We have discussed above some of the most common objections to purchasing CapEx software and explored how to overcome them.

We hope the article has given you some helpful advice if you are working to get a CapEx initiative off the ground.

Are you looking to automate CapEx approval processes?

eCapEx helps capital-intensive industries such as hospitality and manufacturing manage the complete CapEx lifecycle – from planning and budgeting to approval, tracking and post-investment review.

You can schedule a demo or call 03300 100 000 to discuss your requirements.