Companies choosing to invest in an ERP system do so because they want to automate the management of their business data, get more accurate data, have faster access to their data, and be able to make sound business decisions based on that data. To help ensure businesses get the most out of their ERP investment, I’ve written a four-part series about the evaluation process.
The first post in this series discussed identifying the need for a new system. The second post covered establishing a project budget and documenting the project objectives. Now it’s time to look at selecting the right software vendor and partner to help with your implementation.
Choosing a Software Vendor
To start, let’s clarify some terminology. Numerous ERP solutions are available in the market; the more prominent ones are owned by Microsoft, Oracle, SAP, and Sage. These companies are known as “publishers.” Publishers have multiple ERP products—called “solutions”— in their portfolio. Most publishers have an established ecosystem of “valued added resellers,” or VARs. The primary objective of these organizations is to make sure both your implementation and long-term use of the ERP solution are successful.
Each ERP solution has its own configurations and features, and selecting the right one based on your business requirements, objectives, and budget is no easy feat. The term RFP may come into play here, but in my work with many clients, I’ve found them to be a rather inefficient, laborious process.
A more efficient and effective approach would be to consider this checklist of questions to gain clarity about what is best for your situation:
- What solutions do businesses in my industry use? Your solution should have a strong track record working with businesses who have requirements similar to yours. In addition, look for positive peer reviews about both the implementation and daily functionality of an ERP solution—a great indication that you’re on the right path.
- Does the solution address obvious inefficiencies in my operations? Business leaders invest in ERP software because it provides Intelligent workflow capabilities for sales, purchasing, and finance approvals; easy-to-deploy integration with line-of-business applications (e.g., CRM, PLM, 3PL, and proprietary provisioning systems); and user-driven dashboards and KPIs. All these provide huge short-term efficiency gains and a compelling ROI.
- How often does the publisher perform upgrades or provide new product releases? Regular upgrades and releases improve functionality and add new features to improve your business processes.
- Who will be implementing our ERP software, and what experience do they have? Without a doubt, this is the most important decision you’ll make. A publisher might tell you they’ve implemented many ERP projects like yours. While this may be true, the publisher’s team assigned to your project might not have the required experience. On the other hand, a local VAR provides much more transparency about who will be on your implementation team. A VAR’s business success is based on their ability to help you implement the solution and operate it for years to come. This is much different than the publisher, whose business is based on developing and selling great software—not implementing it.
- What training is provided? The more your employees use the system, the more value you will derive from it. How intuitive the system is and how much training is required will help determine the success of your new solution.
- What support do you provide? You’ll want to know what ongoing services the vendor provides, the different levels of support, response times, and after-hours availability.
- What is the pricing structure? For example, cloud ERP is much more affordable to implement than an on-premise solution. And if the solution is offered on a subscription basis (SaaS), ongoing costs are also more affordable—especially for SMBs.
Finding a Partner for Your ERP Implementation
These questions can be helpful, but the truth is, choosing and implementing an ERP solution is a complex process that requires help from the professionals. You need a trusted partner who can help you consider the many options, assist in implementation, provide customization, and help integrate your data into a single, cohesive framework.
Similar to choosing an ERP vendor, you’ll want to consider several critical factors when evaluating a partner:
- What ERP solutions do they offer? Work with a VAR that implements and supports more than one solution. A multi-solution VAR can educate you on which solution is best for your organization ad will take the time necessary for you to make a confident decision.
- What industry experience do they have? Your partner should have extensive industry experience—one who is familiar with the mainstream process for implementation, but who also understands the specific challenges you face, such as customization or data integration.
- What services do they provide? Do they offer ongoing support and consulting after implementation? Do they offer customization and integration services?
- What do your colleagues or people in your network say? You can trust them to recommend a reputable consulting team.
The Bottom Line
The consulting firm you select should be focused on you and your needs, one who educates you, not just sells to you. Most importantly, you want one with an unbiased view of the different options, so you can be sure you’re getting the right ERP solution for your business.
In our final blog post in the series, I’ll share what you need to know about ERP implementation that no one will tell you.
For more information about this blog post, please contact us at FRC@rimerman.com.