Why ERP software is not about the software

In many companies, ERP software is considered as an IT topic. It is a system, an application, ran by the IT department and if you experience any difficulties, they will help you back on track. However, with ERP implementations, upgrades and new features, the role of IT should actually be limited.

You want to achieve the business goals

Organizations with an ERP system have all information for managing their business in one environment. From finance to operations. The benefits of this have nothing to do with IT. It is about a better overview of your information, better collaboration between departments and better decision-making. Resulting into working more efficiently, higher performance, lower costs and more satisfied customers. So, with ERP software it is clear you can achieve organizational objectives. With an ERP system, the most important question to ask yourself is: which ambitions of the organization can be realized with the system?

Processes are leading, not software functionalities

Because the objectives are related to the business, your business processes must be leading in ERP projects, not software functionalities. Define the optimal processes for the organization that deliver maximum results and then see how the ERP software facilitates this. If you opt for an ERP system based on the industry in which your company operates, the best practice processes will be facilitated for sure. Unfortunately, in many companies it is still the other way around: the ERP system with all its conveniences and inconveniences is leading and the business must find a way in how to work with the system. Causing processes not to be optimal, because the ERP system does not provide specific functionalities or imposes a different way of working.

Return On Investment is the goal

With every decision regarding ERP software, Return On Investment must be the goal. Whether it is a new implementation, an upgrade, a new module or an adjustment, the decision must be based on a comparison of the costs and the (expected) benefits. Therefore, when making decisions about ERP software, prepare a business case in which you provide a complete overview of the costs and revenues.

Make sure "the business" is in the driver seat, not IT!

The most important conclusion: it is up to the business to take decisions. However, the input from IT is very important as well. Aspects such as safety, reliability, speed and compatibility all play a role in the decision process. Let your IT specialists test how your ERP-related decisions score in these areas. But more important when it comes to ERP software is to take decisions of which:

  • The management is convinced that the ambitions of the organization will be realized;
  • The project members and key users are assured that the optimal processes and working methods are facilitated;
  • End users not only accept the decision, but even embrace it and understand the added value for their daily activities.

Philip van Kemenade is marketing manager at Dysel and is in contact with software end users every day.