If you are taking a hard look at your current systems with an eye for improving efficiency and ease of use, here are our top 10 Questions to Help You Decide on a New ERP System.
1. Shouldn’t I just upgrade my current software?
It is important to review your software systems every five years to optimize performance. You may indeed be able to upgrade your current system in order to use it to its full capabilities. There may be new releases that add features you want. You’ll want to evaluate the latest and greatest version of your existing solution, provided you like it already.
- Be sure to evaluate what is working well and what isn’t working.
- Is it missing critical features or is it more of an employee training issue?
- Do systems integrate with other solutions or are people providing the connection via manual data input or email communication?
What matters most is that your current solution meets both your present and anticipated future needs, and that includes integration capabilities, flexible deployment methods, and a modern technology platform.
2. What functionality do you really need?
If an upgrade of your current system won’t address issues identified above, and you are considering new software, take the time to isolate your business’s biggest challenges. This involves identifying shortcomings of the current system, identifying ideal functionality and putting thought into scalability needs over the next 10 years. If this sounds daunting, we at Parallel Solutions have helped hundreds of companies map out a plan for new technology and processes. We like to visit your manufacturing and warehousing facilities to get a complete understanding of how your business works. Then we can help you prioritize which functionality your business needs to run smoothly, efficiently, and profitably.
3. Cloud or on-premise?
On-premise solutions are located / installed on hardware that is owned and maintained by your company. Cloud ERP is a system that is hosted on a global platform like Amazon Web Services, a local hosting platform or on your own servers. It is accessed via a web browser. The deployment method you choose will influence ownership costs, security, system upgrades and accessibility.
4. Will business growth require expansion of functionality in the future?
Considering the long term benefit of an ERP system is not always easy, but it is essential for getting the right solution for your company’s needs. In one case, our client, ALTEO, considered system needs and came up with a straightforward list. The experts at Parallel Solutions helped fine tune ALTEO’s business process model and dove deeper into the needs analysis over the long term.
Scott Barnhouse, Director North America, found this service to be especially valuable. “Parallel Solutions guided us through the decision process regarding the specific ERP that was best suited to our company and showed us that QuickBooks Enterprise would not be our best long term solution. Initially, we did not fully understand the longer term, total needs of the company.” Read more
5. Do you have management support for software change?
Management buy-in and company culture are key for ERP success. After all, it is the people, not the software, who implement the changes. Even if benefits of ERP seem obvious compared to a legacy system, selling large-scale change is never an easy task. Management’s focus is primarily the bottom line, which means getting buy-in requires diving into true cost and ROI projections, defining clear objectives and metrics, and creating a streamlined process. Be sure to provide firm numbers and craft a compelling financial argument.
6. How do you select an ERP vendor?
ERP launch, implementation, training and ongoing support, is as effective as the team of people leading these efforts. When you choose a vendor, choose a group of people who have the values and level of experience you trust. RFPs are a common way to vet potential vendors for your ERP system. However, asking valued customers and vendors which software they use may save you time and money. Are they happy with the service they received during implementation and ongoing support? We also suggest industry references as they are a more effective gauge of compatibility with a business partner. Be sure to ask:
- What other companies have you worked with that have similar business processes?
- Who, specifically, at the firm will be helping us with ERP implementation and what is their experience?
Take time to talk and interview existing clients about their experiences with your potential vendor.
7. What will it all cost?
How much will this run me? The common answer in the ERP industry is “it depends,” which can be frustrating for clients. The typical process is a collaboration between the company and the ERP vendor to choose how much software you need and mapping out the costs and expected return on your investment. This doesn’t mean going into the process without a budget. Some factors that determine price include: software costs, training, hardware and hosting costs. Be wary of price guarantees. Fixed price quotes typically build in a large cushion, so while it offers insurance against vendor incompetence, it may cost more if the project takes less time than anticipated. Also, fixed cost is never guaranteed. If not properly specified in the contract, there will be change orders.
8. How long will it take?
How much time should be dedicated to ERP implementation? Aside from the vague answers such as “as long as it takes” and “it depends,” mid-size firms (25-150 users) can plan to spend 6-12 months rolling out their new ERP software. Keep in mind that ERP projects are actually business transformation projects and, therefore, the timeline really does depend on factors like the level of customization, business complexity, data integration issues, executive buy in, creation of an effective project team and successful training. It is important to acknowledge that technology alone will not make you efficient. The most successful companies spend a good chunk of their time evaluating the processes and procedures that are in place so that they don’t just replicate the existing shortcuts that might be in place.
9. What are your resources for implementation?
While a competent and experienced vendor takes the guesswork out of implementation and training, there are some responsibilities that fall to the end user, and having the resources for these tasks is essential. Cleaning up and managing data before the transfer to a new system is one such task. Your ERP vendor can help you better understand what other resources you, as an end user, will need for the planning, implementing and training phases of ERP software replacement.
10. Do you have a comparison guide for your top choices?
Selecting an ERP system to run your business is a daunting decision that will affect your company for many years. Many products offer the same or similar features, and it can be confusing to sort out what’s essential and what’s not. Our checklist can help – download it now!
Parallel Solutions has been implementing ERP software for 25 years. If you have questions about whether it’s time for a change in your current ERP system, give us a call at 440-498-9920 or contact us and we’ll be happy to discuss the best solution for your needs.