Enterprise resource planning software, or ERP, has traditionally been a pursuit for the global enterprise. It has been expensive, complex, and a deep time investment only mega-corporations and Fortune 500 companies could pull off.
The ERP landscape is changing.
Expected to hit $43.4 billion in 2021, ERP software is becoming an ascending to new heights and is not only for global mega-corporations anymore. Cloud technology and the invention of subscription-based software has brought a newfound appreciation and need for ERP systems from companies who previously didn’t require such technologies.
Perhaps you’ve navigated to this page today excited at how a cloud-hosted ERP could combine your company’s customer management, marketing, inventory, accounting, and human resources into one single system. You’re interested in streamlining processes across your organization in ways you never thought possible.
Maybe you already have an ERP system in place but are looking to upgrade and receive additional and enhanced customer support options or need something that works better with your current business model.
Ensure you consider the following five factors while comparing and choosing ERP software to confirm your money is being well invested in a technology, and a company, that is right for your business needs.
What Can It Do?
ERP allows you to manage daily schedules and offers a database of centralized information across the business to utilize every resource efficiently. This fosters strategic planning, enhanced speed, and better synchronization.
This allows manufacturing costs and inventory waste to decrease when implementing a just-in-time inventory model.
With new data and analytics providing you with actionable intel, you’ll increase productivity to new heights.
Benefits vs Costs Analysis
The costs of software can be determined with a simple Q&A session. The onboarding costs should be planned and managed properly so as to minimize training and integration costs. Other costs could be:
- System Licensing Costs
- Consulting Fees
- Data Migration
- IT Maintenance
- Individual Project-Based Expenses
Your business is unique and much different than other companies. That’s why it’s unlikely you’ll see many public-facing price charts for ERP systems. Once you’ve reached out to an ERP software company, they’ll likely assign you a dedicated account representative who will work with you on a customized quote based on selected features, number of users, and deployment model (cloud, on-site, combo).
As your business grows, so does the necessity for your ERP system to grow along with it. When software molds to your business as it grows, it’s called elasticity. Consider the following four indicators of elasticity in ERP systems:
- Update Frequency
- End to end. If the ERP does not link with or contain all aspects of the Job’s life cycle then you may be inventing constraints
- Will you out grow the functionality of the ERP? Does it have the features that will encourage growth?
- Connect to external systems, which reduces double data entry.
The goal of your
business is to grow. If your ERP system doesn’t show a willingness to grow with
it, you’re wasting your time and money.
What Kind Of Vendor Support?
Unless you are a global company with offices on multiple continents, setting up an ERP system may be a new process for you. It’s not a week-long turnaround. Implementing, installing, and effectively using an ERP system can take up to a full year, although many companies experience short-term gains validating the investment.
You’ll need top-rate training support along the way to avoid frustration.
This type of support is crucial to understanding your new ERP and commonly includes help in data transfer, app integration, training sessions, and custom configuration.
Who Is The Vendor?
Large ERP vendors include Oracle, SAP, Sage, Microsoft, and IBM. Choosing an ERP system solution from one of these companies gives you comfort in a name without the custom-tailored experience of a more local vendor.
Conduct research and do your due diligence in researching companies, including past completed projects and success. Here are a few other ways to do company research:
- Find Demos
- Find and research case studies
- Read customer reviews
- Ask unbiased third parties for recommendations
Selecting your ERP system is a big deal. Make sure you consult with a team of professionals who know what’s best for your specific business.