After spending over 10 years as an end user, decision maker, and stakeholder in the ERP selection process, I have compiled a short list of elements to consider when choosing your next purchase. ERP systems can be very similar in certain aspects, but very different in others. Some systems are more economical, others offer ease of use, and even more will try to sell you on their flexibility. When looking for an ERP system, it all boils down to what makes the most sense for your company, so make sure to ask all the pertinent questions to make your switch as seamless as possible. Here are five key topics to consider when making your decision:
One of the top functions of an ERP system is the capability to produce the output, measurements or reporting. If you can’t get timely, almost instantaneous, reporting that assists in key management decisions, than the output is outdated in today’s rapidly changing environments. Make sure that getting information out of the system can be comfortable for all users and that translating that information into a usable format is efficient.
Safeguarding the integrity of the data is becoming increasingly prevalent in all sectors of business. Even the private sector has seen additional pressures to make sure that the IT group and the Finance group are in compliance with proper standards and verifying these standards on a periodic basis. Make sure to involve the IT group in your decision and confirm that the ERP system can accommodate simple or complex security to ensure that your internal controls continue to be bulletproof.
Don’t shoot for a Lamborghini when a nice midsize will do just fine. Sometimes it’s easy to get caught up in the “bells and whistles” of an ERP system, but these usually come at a cost, not only up front, but in complexity as well. Your company has probably already assembled a team of key personnel from the IT, HR, and Finance groups to compile the company needs, five to ten year growth plan, and significant functionality required from your ERP system. Make sure to rank each need so that the new system will fit your business model without exceeding your budget.
Flexibility of the software can be a major role in making your decision. The flexibility to mold an ERP system to your business atmosphere is crucial, but if a system is too flexible you may lose some reliability or internal controls along the way. Remember that some procedures may need to change to accommodate functionality or more specifically there may be a need to customize, but be cautious if this list starts to take on a life of its own because the more you customize, the more you subject yourself to potential nightmares during expansions, service packs, and upgrades.
The capability of increasing efficiencies through import and export tasks can make the bottom line surge. Too many organizations get bogged down in the everyday data entry process. Some companies still employ the idea of entering once to a spreadsheet and then again to the ERP system. Importing data directly from a source, albeit potentially a spreadsheet, will eliminate the data entry need and cut down on user error. Exporting figures or statistics from the system allows the end user to carve out KPI’s used in upper management or board of director decisions.
These ideas will all be part of your decision making process, but by no means all of the things to take into consideration. Again, decisions need to be dictated by the specific business needs of your organization and generally those can vary greatly from company to company. So make sure to consider all aspects of the ERP system, specific modules, and which add-on products to use to assist in coming to your conclusion.
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