When selecting an ERP system, organizations often take a very thorough approach. In an extensive selection process, the various options are examined and evaluated in order to take a well-informed decision. And they have every right to do so, because this decision impacts the future of the organization. But what are your selection criteria? When you base your decision on the wrong criteria, you still don’t make an optimal choice, despite all the time and energy you have put into the selection process! These are the most important criteria for you to focus on (and their counterparts you should not focus on).
1. Return On Investment - **NOT** Costs
A new ERP system often requires a significant initial investment and brings periodic costs as well. Too often conclusions are drawn in selection processes after a comparison of the costs of the various options. It makes much more sense to look at Return On Investment (ROI). Because in the long run the cheapest option might also be the least profitable, while a more expensive option can offer more benefits and provide a great ROI.
2. Organizational ambitions - **NOT** Long list of functional requirements
Your main goal in the deployment of a (new) ERP system should be to realize the ambitions of the organization. Whether that is organizational growth, improving the service level, working more efficiently or entering new markets; in the ERP selection you must look at the feasibility of these goals. However, many companies put together a long list of functional requirements, often based on the current system(s) and current way of working. This will get you a (poor) copy of what you already have! Focus on the future and what you want to achieve as an organization.
3. Stable and modern system - **NOT** Always be first with what is new
Innovation often leads to improvement. But especially when it comes to ERP software, the backbone of the organization, it is dangerous to always be the first to work with a new product or new version. Go for modern software, but also stability. Is the ERP system proven successful? Based on a stable and modern platform? Then you know you can rely on the choice you have made and that it is not a pilot product or a version full of bugs.
4. The (business) partner - **NOT** Just the product
The company you work with for ERP software is often seen as the 'supplier'. As if they deliver a product and then disappear from the scene. But ERP touches the core of your business and revolves around crucial processes that can make or break your organization! Consider the 'supplier' as a business partner and, in addition to the software, evaluate this party thoroughly too. Do they bring in the knowledge to bring your organization to a higher level, now and in the future?
5. Similar references - **NOT** as many customers as possible
An ERP partner can only truly help you if they understand your processes and activities even better than you do. And that is the case if they have helped similar organizations in the same industry. With these experiences your ERP partner knows the best practices in the industry and has incorporated these into the ERP system. So, it is not about many references, but about the right references.
Philip van Kemenade is marketing manager at Dysel and is in contact with software end users every day.