Best Practices for Choosing ERP Software For Your Business
This article will provide some of the best practices for choosing ERP (Enterprise Resource Planning) software which has become a staple of the modern business world. Choosing ERP for automating and centralizing business workflows and information, allows a company to quickly share information between departments and manage fixed assets and inventory.
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Key Factors to Remember While Choosing ERP
For your business solution to serve you well, while choosing ERP, start by looking for options that meet the following criteria:
- It can handle multiple types of currency (U.S. dollars, euros, yen, etc.)
- It has a strong security system with encryption procedures.
- It can handle a high data load without performance degradation.
- It has a modular and customizable structure.
- It can perform data exchange with XML and EDI.
- It has a fast and flexible reporting system.
- It can log all the activities that are performed by users.
- It supports mobile devices.
The next step while choosing ERP is to determine the total cost of ownership for the solution. This is more than the price of the software – you need to take into account the annual fees for system upgrades. If you don’t have an IT department, the cost of technical support and ongoing maintenance should be factored in as well, when choosing ERP. It could turn out that the overall cost is much greater (or cheaper) than you originally realized.
The ERP software vendor’s standing in the business world is another matter to take into consideration when you are choosing ERP. For the most part, you should look for a provider that is still acquiring new customers on a regular basis. Choosing ERP vendor that primarily subsists on maintenance fees is much more likely to go out of business in a faltering economy and leave your company without access to technical support or system updates when choosing ERP.
You should also ask the software vendor for at least three references when choosing ERP vendors. This will give you a chance to talk with other small businesses and see how well the solution worked out for them before choosing ERP vendors. If the ERP vendor does not want to provide references and tries to steer you towards case studies or unsourced quotes, it’s not a good sign – you may want to just move on to another provider.
One other step when choosing ERP is to ask the vendor for a free demonstration of the software. You can use the opportunity to try out different configurations and determine how flexible the system truly is. You’ll also have the opportunity to test the special features and see whether or not they’re worth the additional price before choosing ERP. You may have to go through the process a few times if you’re not fully satisfied, but you should be able to find the best software for your company in the end.
What More to Consider While Choosing ERP?
While choosing an ERP solution for your business, you need to be thorough and ensure all your requirements are being met currently and the solution will be able to scale and keep up as your business grows. Here is what more you can do that will help you make a better choice when choosing ERP:
- Prioritize the user experience.
- Ensure the Integration of the new ERP with other apps.
- Consider flexible and low-code systems when choosing ERP.
- Anticipate future needs and plan accordingly.
- Look for long-term commitments.
- Consider and decide on customization vs. standardization when choosing ERP.
Prioritize the User Experience
It is crucial when choosing ERP software you choose to provide an easy and user-friendly experience. If the workforce for which the ERP is meant, is unenthused about using it due to outdated technology or too much technical jargon, the investment will be a lost cause. Also, make sure to check for training material such as online guides or community support referred by your vendor before choosing ERP vendors.
Ensure the Integration of the New ERP with Other Apps Before Choosing ERP
Beware that an ERP solution does not work in silos. The IT department caters to managing and monitoring the smooth functioning of the entire business process. It is important to equip your IT department with an ERP solution that interacts and integrates well with databases, all applications, and with the rest of the IT infrastructure when choosing ERP system solutions.
Consider Flexible and Low-code Systems
The recent shift to agile software development has offered flexible, low-code or no-code development environments, making upgrades and usage much easier. With such low-code options, companies can safely develop improvements without disrupting the core ERP system when choosing ERP solutions.
Anticipate Future Needs and Plan Accordingly
When choosing ERP solutions, keep in mind that it is the best opportunity to be looking for something that will not just cater to your current business requirements but will continue to have your back in the future. Use advanced data analytics to anticipate and address your future needs, and make sure to discuss future plans beyond software implementation with your chosen vendor before choosing ERP solutions. Treat your ERP software like a strategic tool.
Look for Long-term Commitments
For most companies, choosing ERP system highlights internal constraints in terms of resources or skill, and requires the company to decide whether it should form affiliations with an ERP vendor or hire a 3rd party consultant. Since ERP commitments are mostly long term, it is important to look for a partner with a sound understanding of your business operations and workflow dynamics, and excellent industry expertise when choosing ERP solution providers.
Consider and Decide on Customization VS. Standardization
While the battle between picking customization or standardization when choosing an ERP seems to have no foreseeable end, it is important to begin your search with your requirements clearly understood. Decide on whether you choosing ERP solution that is standard and off-the-shelf or you want something tailored for the specific requirements of your company.
Read our Buyer's guide to help guide your decision-making process for choosing ERP software and implementing the best tools and modules for your business.