How to select an ERP solution
How to select an ERP solution
In a break-out session at the recent Datel Connect 2015 conference, Junior Hewitt, Datel New Business Sales Consultant, gave a whistle-stop tour of the key stages in choosing an enterprise resource planning solution. Here are some of his top tips for helping companies across the UK to make this all-important decision for their business…
Get buy-in from your senior management
It sounds obvious, doesn’t it? But I’ve seen ERP projects flounder further down the line, wasting everyone’s time, because of a lack of sponsorship from the top. What budget is the leadership prepared to invest? What timescales are they looking at and how would these fit with any seasonal variations in your business? What, at a high-level, are the core requirements? What quirks in the way you do business must any new system accommodate?
Quantify the risk of doing nothing
It will support the business case if you identify the opportunity cost of maintaining the status quo, whether that’s labour-intensive manual processes or an under-performing ERP system that is showing its age.
Put names in the frame
Identify a project sponsor - that is, a senior manager who has budget sign-off and the authority to clear any obstacles - and a project leader who will have overall responsibility for driving the project forward and being a single point of contact for the providers pitching for your business.
Start to build your long-list
Armed with your list of essential requirements, you can begin to survey the market by attending exhibitions, asking for recommendations and conducting web research. The type of questions you'll be asking include:
- Does this system do… (your key requirements)?
- What size of company tends to choose and use it?
- What are the upfront costs of the software, customisation, implementation, training, etc.?
- What is the ongoing annual cost of ownership likely to be?
- What are the deployment options (on-premise, hosted…)?
- What complementary solutions does it integrate with?
Regarding deployment; as a general rule, if your IT infrastructure is creaking at the seams or your IT resources are limited, consider having your software hosted in a data centre.
Narrow the field down to a short-list
Having got your head around the big picture, you’ll then want to start interviewing prospective partners to understand what resources they have. This is not just for the initial customisation and installation, but for post-implementation support, too.
If you consider more than three or four strong contenders in depth, you’re probably spreading your net too thinly. Ideally, put two or three providers under the microscope. Talk to their reference sites about their experiences of working with the provider.
You need to see a live demonstration - not just a quick walk-through the generic flashy stuff, but a demo using your own data, with the opportunity for your users to ‘play’ with the system. How simple and intuitive is it to use? How easy does it make it to understand management information at a glance? What are the reporting options?
Mind the gap?
Unless your ERP system is 100% bespoke, it will never do absolutely everything you want. Can you live with the gap? Can the system be tailored to your requirements? Could complementary solutions be integrated? Again, what showstoppers would put a contender out of the running?
All development work comes at a cost and it should raise another red flag if a provider makes it all sound too easy.
Take your potential provider for a test-drive
Some businesses take the selection process to an even deeper level by commissioning the front-runner to carry out scoping workshops with business users, to analyse requirements in detail.
These workshops will be chargeable but offer a low-cost way to see the provider in action and to assess whether you can work effectively during the implementation and beyond.
It quickly becomes apparent that choosing an ERP solution is no 2-minute task.
So, to get yourself started, it's important to revisit step 1 of the process: getting senior management buy-in.
The most efficient way to achieve this is with a strong business case, and that's where Datel's ERP Diagnosis Tool proves useful.
The app, available as a free download from the App Store, helps you to identify the 'problem areas' in your organisation and build a custom business plan for a problem-solving ERP solution.
Simply search 'Datel' in the App Store to download and make a start on your bespoke report.