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ERP System Selection Methodology


When attempting to select an ERP system, it is very essential to understand and discuss all relevant requirements. It is advisable to choose a vendor after gathering adequate requirements on critical and non-critical business processes. Some of the aspects that companies should consider before deciding on an ERP system are as follows.

  1. Involving key staff from critical departments in the project
  2. Having adequate discussions to have a clear understanding of all essential functionalities
  3. Getting expert advice from vendors but also involve the in-house personnel validate the same for suitability
  4. Estimating the Total Cost of Ownership (TCO) well in advance to avoid overheads
  5. Validating suggestions from all the members involved in the project
  6. Understand the present IT systems and evaluate the additional requirements for the ERP implementation
  7. Setting the expectations right, before the project commencement. This ensures that the teams across the organization plan accordingly.

After evaluating the aforementioned aspects, the next step is to identify potential vendors and select the most suitable solution. The following is a list of activities a company should undertake, before arriving at a solution.

[1] Perform an exhaustive analysis of functional and technical requirements

[2] Drafting a detailed Request For Proposal (RFP) that states without any ambiguity, all the requirements while taking into consideration various factors like cost, technology, ROI etc.

[3] Perform a detailed market research to get a list of all potential vendors who can serve the purpose and circulating the RFP to all the selected vendors

[4] View a demonstration of the ERP solution and discuss with the vendor in detail about tailoring the solution to the requirements.

[5] Choosing a vendor who can provide the most effective solution that can meet the maximum requirements.

[6] Calculate the total cost of ownership (TCO) and negotiating the price and contract. A legal advisory firm can help cross check and include all relevant clauses required.

Devising effective plans and implementation strategies ensures flawless execution.

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