Which Enterprise Resource Planning (ERP) software is right for my company? Every company and every entrepreneur has to ask themselves this question sooner or later when selecting ERP. A decision here should not be taken lightly and should be carefully considered. Hasty and insufficiently qualified decisions often lead to high follow-up or switching costs, angry and demotivated employees, stalled workflows and, in the worst case, the loss of the company.
When does an ERP selection consultation make sense?
Older companies in particular, which have grown dynamically over the years, lack competence in the area of ERP and business software. The result is many small, unconnected or incompatible isolated solutions. After years of working with familiar systems, almost all employees develop a kind of “blinker” for new things and it is difficult to apply their own processes to a new ERP program. This can result in an insanely long decision-making process. It then often happens that great importance is placed on supposedly “important” functions which in reality are of little importance. The really crucial and fundamental functions then quickly fade into the background and receive far too little attention. However, many young companies also often have difficulties selecting a suitable ERP system. In these companies in particular, the employees are brimming with innovative ideas and visions of the future. This is of course wonderful and should not be stopped.
However, when making the selection, far too little attention is paid to the core functions of the ERP program and the company quickly opts for software that, although it offers many new approaches and technologies, is not yet fully developed at its core. In addition, many of the younger employees have never worked with such a program before. They simply lack the experience of what is important in the new ERP system.
ERP selection with enterDATA as partner
Our employees combine the world of software with the complex requirements of a company and therefore always come from a manufacturing, trading or similar company. Our structured and tried-and-tested selection process in conjunction with our industry-specialized consultants gives you maximum support in selecting ERP, contributes significantly to the success of the project and minimizes your risk many times over. You save valuable time, use capital more effectively and ensure high levels of acceptance among your employees.
Our ERP selection process:
Preparation
We start by reviewing existing process and company documentation, e.g. process descriptions, organizational charts, IT landscape. The goal is to identify the core and value creation processes. In addition, initial ideas for the future system landscape are collected here. An initial indication of the company’s ERP history and the experiences of key users with regard to an ERP selection or an ERP project is also important for follow-up activities.
Strategy workshops
The strategy is one of the decisive factors in an ERP project. It forms the cornerstone of the entire project. Here, the overall picture is considered and the strategic guidelines for the ERP decisions as well as a roadmap are defined. The focus here is on the strategic direction and its economic goals. Relevant questions here lie in topics such as starting points for possible project planning, interim solutions and critical time windows as well as a definition of the potential ERP scope and the business cases affected.
Process workshops in the functional areas
In the course of process audits along the previously defined value chain, the functional requirements and a process map are defined together with the employees. For example, a distinction can be made between specific process dimensions, e.g. management processes, core processes (value creation) and supporting processes. The result of this phase includes the unique selling points, “show stoppers”, functions that add value and requirements based on the strategy.
The starting point for the process analysis is to question the ERP relevance and the digitization capability of the processes under consideration. In the course of the analysis, it is helpful to compare the processes and the future system landscape, i.e. which process steps should subsequently be implemented in the ERP system.
Market analysis and evaluation of potential ERP solutions – creation of the longlist and ERP specifications
As a first filter for creating the longlist, we analyze the market based on general criteria (such as industry, focus, size/installations, geographical proximity, references). It is extremely important to us to enter into direct communication with ERP manufacturers and ERP implementation partners at an early stage. Transparency from the start is crucial for finding the right “match”. This is followed by the final creation of the tender documents and the ERP specifications.
First filter: Review of the market based on criteria (industry, focus, size/installations, geographical proximity, references)
Start of the tender
After mutual agreement and approval of the longlist, we take care of exchanging confidentiality agreements. Once all precautions have been taken and all tender documents have been approved, we take over the dispatch and ensure that the documents are evaluated on time. On this path to the offers, we always maintain communication and are available to answer questions about content and organization.
Evaluation and analysis of feedback
After the tendering phase has ended and we have received the functional and cost assessment from the ERP providers, we use two additional filters to determine the final shortlist candidates.
Second filter: Focus matrix to take into account the strategic direction and key company-specific selection criteria.
Third filter to create the shortlist: Influence of the requirements and criteria from the workshops (processes, unique selling points, know-how)
Questions we ask ourselves include:
- Does the solution cover the required range of functions?
- Can the ERP be integrated into the existing infrastructure?
- Does the software support new and future-proof technologies, such as artificial intelligence?
Conducting provider workshops
Based on practical use cases, provider presentations and demos are carried out with the participation of employees, where they present their software solution and project methodology.
Use cases document the functionality of a planned or existing system using simple models. They describe the externally visible behavior of a system from the user’s perspective.
Use cases are characterized by fundamental properties. A use case
- describes the behavior of the system to be developed
- represents the user’s perspective
- can be specified with a multiplicity (one object can be related to several)
- does not consider details of the system behavior
- can be abstract (it cannot be executed itself, but only by other use cases)
We support you in identifying the appropriate business cases and the formal representation.
Decision making
When analyzing and processing the results and preparing the decision template, several criteria must be taken into account, e.g.
- Functionality and coverage of business processes
- Scalability and flexibility
- User-friendliness and training effort
- Integration with existing systems
- Costs and ROI (return on investment)
- Provider and solution quality
- Support and service
Ultimately, you need an ERP platform that is tailored precisely to the needs of the company.
Contract negotiations and conclusion
Many points for a successful project can already be collected here. We support you in drawing up the contract and use our expertise to ensure a fair and secure project basis. However, it is important not only to rely on lawyers and to protect yourself as best as possible against all risks, but also to lay a good foundation for a collaborative partnership with experience and common sense.
Nevertheless, essential aspects must be ensured:
- Comprehensive description of all services, functions and deliverables
- Prices and costs
- Service Level Agreements (SLAs)
- Implementation schedule and milestones
- Adaptations and extensions
- Data protection and security
- Termination of contract and exit clauses
- Liability and warranty
ERP selection criteria
When looking for the right ERP system for you, we always take the most important ERP selection criteria into account in the selection process, which we also explained in detail in our blog post. From functionality to scalability and security to user-friendliness, integration and costs, we have presented all the basic criteria for you.
Find out more about the importance of these and other selection criteria and how they can help your company work more efficiently and reduce costs. Read the full blog post and contact us if you have any further questions or need support with the ERP selection.
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ERP specifications
The ERP specification is an essential component when introducing an ERP system. It is a comprehensive requirement specification that documents all of a company’s requirements and needs for an ERP system. The specification forms the basis for selecting and implementing a suitable ERP system.
In our blog post, we go into detail about the topic of ERP specifications. We explain why a specification is important and what information it should contain. We also explain the process of creating a specification and give practical tips on how to create an effective and meaningful specification.
Challenges in ERP selection
Choosing a suitable ERP system presents companies with a variety of challenges. One of the biggest challenges is identifying the company’s individual requirements and needs and matching them with the available ERP solutions. Every company has unique business processes and operational requirements that must be taken into account. Therefore, it is important to conduct a thorough analysis of the current business processes in order to get a clear idea of what functions and modules the ERP system should cover.
Other possible challenges when selecting ERP:
- The future viability of the selected ERP system is another important aspect. Companies should consider their long-term goals and growth plans to ensure that the ERP system is also able to keep up with changing requirements.
- A scalable system that is able to add new features and modules or adapt to changing business processes is therefore crucial.
- The complexity and variety of ERP solutions available further complicate the choice. There are a large number of vendors on the market offering different modules, features and industry solutions. It requires a careful evaluation of the different options to find the system that best fits the specific needs of the company. One way to make the choice easier is to create a detailed list of requirements and match them with the functionalities and scope of the different ERP solutions.
- Close cooperation between the different departments of the company is also crucial. The selection process should not be limited to IT or finance departments only, but should also include the needs and perspectives of other departments such as production, sales and customer service. An interdisciplinary team can provide a holistic view of the company’s requirements and ensure that the ERP solution selected meets the needs of all departments.
- In addition, clear communication is crucial throughout the selection process. It is important to clarify the expectations and requirements of all stakeholders and ensure that all relevant information about the ERP system and its impact on business operations is conveyed. Regular meetings, training and open discussions can help avoid misunderstandings and create a common understanding about the ERP software selection.
Do you need help selecting an ERP system? Contact us now and let us find the right ERP solution for your company together.
