Years ago, when a client needed help evaluating and selecting a new ERP system, it was pretty straight forward. We would follow a basic methodology, define pain points, document requirements and go through the traditional long list and short list analysis of potential solutions.

Today, the approach in actually selecting a software hasn’t changed too much, but the prep work required to define what it is we are selecting has become significant. The reason for this is due to the explosion of technology innovation over the past decade. You can no longer state that you just “need a new ERP” unless you are simply replacing a broken system, and if that is your motivation for bringing in new technology you may be missing out.

In addition to streamlining the ERP vendor evaluation process, you will want to consider doing the following before you begin evaluating solutions:

Define a strategic objective for the initiative: It may be as simple as “we need a new ERP because our current platform is sunsetting”, but we recommend pushing a bit beyond that in most cases. Is this an opportunity to make technology a competitive advantage, do you want to create a better customer experience or prepare to scale without increasing headcount? The defined objective should correlate with the greater corporate strategy of the organization as a whole as well as have executive input and support. This will then feed into defining the best digital strategy for your organization that needs to be in place before selecting an ERP.

Define your digital roadmap: While still a critical piece, ERP is no longer necessarily the driver of technology within an organization. In any size company there is a multitude of solutions in place, sometimes a mix of cloud ERP and on premise, some legacy and some newer applications that have been brought on to handle a specific need. You will need to determine those that definitely need to be replaced, those that won’t be replaced and those that should ride along in the evaluation to see what other options exist. There may also opportunities for discussion around standardization, scalability and shared services that could be beneficial moving to your future state. Essentially, you need to determine what defines “ERP” within your organization and where it fits into the greater strategic plan.

Consider the need for emerging technologies: Artificial Intelligence (AI), robotics and machine learning, advanced analytics, Augmented and Virtual Realities (AR/VR), Internet of Things (IoT), blockchain, edge computing, etc. sound exciting – and they are. While they are not required for an ERP implementation, this could be an ideal opportunity to take advantage of some newer trends to bring competitive advantage and complete the last mile of your digital transformation. If you will be looking into any of these types of technologies, it will be critical to map the sources and flow of data and associated technology requirements that will more than likely touch ERP.

Define data and security requirements: The news is out on the growing importance of data security and regulatory requirements (i.e. GDPR), and if existing processes or technologies are not up to date, then they will need to be updated or replaced. Things like cybersecurity threats should be mitigated via your implementation. This may or may not influence choice of ERP, but it is important enough to have this determined ahead of time in the case it helps define your IT roadmap.

Ultimately, completing these tasks ahead of selecting software will help to ensure that you get the right type of application before selecting a specific application. Nobody really enjoys implementing ERP, and doing these tasks will help prevent you from having to go through the whole process of selection and implementation again in a few years. You may find that completing this type of analysis is not easy, and there is nothing wrong with reaching out and asking your favorite independent ERP advisory firm for help.

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