Erp Software Evaluation Guide

Many software companies provide ERP solutions. On the surface it may seem as though there are a very few differences between various products.

Whilst it is true that functionally most products of similar, there are some key differences in the design and internal workings of the various products. Many companies select a particular select vendor for the wrong reasons. For a sample, they might make their choice on software costs alone or, were still, because that's vendor dominates their industry. These reasons are not valid and should not be used in the evaluation process. In this article I am will highlight some of the key points I key managers need to consider while conducting an ERP evaluation.

Reduce budget overruns. ERP systems on notoriously difficult to implement. The human cost of installing and customising the software is often three to four times more than the software itself. This is the reason why many ERP vendor's as well as the so-called top consulting companies offer consulting services focusing on implementing ERP packages. If possible try to negotiate a fixed-price contract. The vendor will therefore except the implementation risk and the possibility of cost overruns is dramatically diminished.

Inappropriate customisation. One reason why the ERP systems are so popular is that they are designed to automate well engineered business practices. Unfortunately, most businesses have practices which are not best of breed. The temptation is to modify the software so that it handles their poor business practices. This is one way of guaranteeing a failed implementation. A much better solution is to streamline your business processes before implementing the software. This way you get to customise the software less. This should improve the chances of a successful implementation.

Automate the mundane. There are some things unique about your business which give you a competitive advantage. These other things which should not be automated and your ERP solution should not address these functions. Your ERP package should only automate those functions which are common across all industries. These are what we call the mundane function. They don't add any real value to your business, but must be handled efficiently for your business to survive.

Scope correctly. Your company's view of the world might be quite different to that of the ERP vendor. ERP solutions come in modules. Each module would address one or more business function, and the modules are usually sold separately. You will need to work out which modules you require and only purchase those modules. This is well have the effect of reducing both the cost and the risk of implementation.