Errors in ERP selection are usually due to ignorance. That is why an ERP selection process should also be tailored to the company's level of knowledge. Accordingly, the company must be prepared for the selection and the ERP selection process must be prepared for the company.
Is the company ERP-ready?
To do this, the "ERP maturity level" of the company must first be determined and the objective of the ERP project be determined. This can be problem-orientated or growth-based, for example. The company's understanding of the process is determined. The current or planned IT projects and the existing IT structure in the company must of course also be taken into account.
In order to determine ERP maturity, the company must be scrutinised closely. The following questions help in the ERP selection process:
- Does the process documentation (if available) at least roughly correspond to the procedures?
- Do you already work with a certain process orientation, i.e. across departments and with added value for the customer?
- Is one aware of the importance of the Master data management Is there a process in place that regulates this?
- Is there maintenance and support management in the provider area and within the company?
- Is/was an ERP system already used or did you work with spreadsheets?
- Are there qualified employees for ERP systems?
- Is there an IT structure? If so, is it integrated into the corporate strategy and/or the business model?
Every time the answer to one of these questions is "no", the ERP selection process changes. After all, no matter how well presented the ERP systems on offer are, they cannot be selected specifically for the company if the people selecting them do not have the necessary experience.
The right requirements in the ERP selection process
Especially when a company is selecting an ERP system for the first time, it is difficult to define criteria according to which ERP providers can be selected. Since no specific data structures or processes are yet in place, many ERP systems can be used in the company. In addition to the basic criteria for the ERP system, there must therefore be further requirements according to which a provider can be selected. These are, for example, awards, user reports in the same sectors or the provider's appearance in the professional community.
Three important steps in the ERP selection process
In the actual selection process, the first step analysing the most important value-adding Business processes of the company. Depending on the size of the company and its ERP maturity, these can be determined and documented in a workshop.
Of the second step of the selection procedure consists of the Return of investment Analysis (ROI), which is intended to show the business benefits of the ERP system. This can also be carried out at other times. Analysing the actual processes would be a possible time to evaluate the provider process in terms of its economic significance.
This can -as third step- ultimately determine and adapt the target definition for the ERP project. This creates a basis for decision-making that the company can refer to during the selection process. It also prevents "moving targets", i.e. changing objectives, during the course of the project. This is because they lead to delays in the course of the project and therefore to costs that have not been factored in.
Step four deals with the definition of the selection-determining criteria. This involves evaluating the requirements that the individual ERP systems have for the company in question. It is not necessary to identify all requirements, but only those that distinguish less suitable from suitable ERP solutions.
The main aim of the ERP selection process is to find the right system for the company. Choosing the right provider is also a target component. It should always be borne in mind that system providers whose offerings are based on big names such as SAP differ considerably in the industry sector.
We wish them every success!
The search for the right part 3: The ERP selection
The search for the right one. Part 2: Errors in ERP selection