Once you make the decision to replace your legacy ERP system or implement an enterprise resource planning solution for the first time, you may be tempted to go and buy the first one see that seemingly meets your needs…don’t do it. It’s surprising how many companies fall victim to this enthusiasm and wind up with the wrong product only to replace it a few years later. In fact, a recent survey from Capterra found that 22% of companies purchase the first software system they looked at and 1/3 of buyers did not even demo the product before buying it! So, before you pull the trigger on a system we cannot stress enough that you carefully and painstakingly compare ERP software solutions; it make be a long process but it will be worth it in the end.
4 Things to consider when you compare ERP software options.
Once you have your short list of solutions you are considering, be sure to take the following into consideration. It’s important to make sure you always compare “apples to apples” i.e. comparing things that can be reasonably compared between the solutions.
#1 The core components: Do the systems have the same core components that you require for management and operations across the company? Such as CRM, accounting, costing, planning, inventory, and others. Each company will have their own set of requirements (not want-to-have’s but must-have’s) in the software so you will want to identify what yours are prior to beginning the ERP comparison process.
#2 The people and company behind the technology: while the technology behind the system you ultimately choose is important, many systems are similar in respects to deployment, infrastructure, and other technical elements. The people and the company you choose to work with on the other hand will be different from one to the next. Look at publisher or ERP reseller reviews, testimonials, financial data if they are a public company, awards, and other indicators of their skill and dedication to customer service.
#3 Price: You cannot talk about comparing ERP software systems without bringing money into the conversation. Be sure to compare the costs of each system but delve deeper into things than just the costs of software. You will need to look at many other factors including license fees, additional license fees, support costs, annual fees, implementation costs, upgrades, and other recurring costs. This is where your comparison can get a little tricky since many companies have different pricing packages and structures. So tread carefully here and be extra thorough as you compare ERP solutions.
#4 Fit for your industry and organization: There are many different ERP systems and some of them have been designed for specific industries or processes. For example you may require a process manufacturing ERP system or a system that offers functionality for engineer-to-order manufacturing process, etc. When you are comparing the solutions make sure you are comparing solutions designed for similar things. For example, do the systems you are comparing offer the types of reporting you require in both your industry and your business? What about tools for compliance or quality? This goes back to the “apples to apples” approach; you cannot accurately compare discrete manufacturing ERP features to process manufacturing ERP features.
There is much more to consider as you compare ERP solutions, so check back for the second part of this article which will dig into other critical considerations. This list should give you plenty to think about until then.
What’s next? Read out the white paper below, because after comparison comes selection and you’ll want to make sure you don’t make these 6 common, yet costly mistakes.