Wow! There Are So Many ERP Providers Out There.
Updated: Jun 17
If you have read my recent blog Help, I need an ERP! with my thoughts on considering your ERP needs, then you are likely ready to move forward with exploring the many available options. Keep in mind that choosing the ERP software that best meets your company requirements is only one piece of the decision-making process. If you don’t implement the solution properly, or the software provider doesn’t have adequate support and stability, you may find yourself quickly struggling. At a high level, let’s examine each of these aspects and see how it may affect your decisions.
Most people will start their search on the web and will likely end up on one of the many software comparison sites. Many of these sites will have some type of financial agreement with the top vendors showcased, so keep this in mind when reviewing the hundreds of available options. Those hundreds of options will range from very rudimentary point solutions offered by small providers to the highly complex and comprehensive systems generally found in Fortune 500 companies. In addition to the obvious cost variance of these options, there will be a large difference in functionality, specialization and experience. Because you have already spent the time in assessing needs, budget and resource allocation, you will likely be able to narrow down the field significantly in these initial searches. However, I recommend that you conduct some initial qualification calls with your chosen vendor base before finalizing your short list, because marketing information available on provider sites is not always accurate. These qualification calls will allow you to ensure the software will address most of your needs within the budget you have set. A good goal here would be to have initial calls with 7 to 10 providers and then try to narrow that field down to 3 or 4 for more in-depth assessment.
Just like software options, there are also many provider and implementer options. The choice of your provider and implementer are tied very closely to your software choice, so this should be evaluated in conjunction with the software, not independently. The software provider is generally responsible for the support of the product and investing to keep the technology relevant. Therefore, it makes sense to choose a provider that is financially stable, has a proven track record, and has the resources necessary to support your product now and into the future.
In some cases, usually with smaller software providers, the provider and implementer are the same. But with many larger, established providers, and dependent on the size of your company, the implementer will be a partner of the software provider. As with the software provider, you want to make sure the implementer has a proven track record and the resource availability to meet your requirements.
In the first blog of this series Help, I Need an ERP!, I commented on the necessity to assess internal resource availability for the implementation of the software. Having an accurate understanding of your resources is even more important now that many software providers have put together training packages that reduce the cost of implementation. However, that reduction of cost is based on the fact that you, the client, will take on the majority of training and implementation tasks. If you have the resources and expertise, this approach may work, but since clients generally underestimate the effort and time involved in implementing a full ERP system that fits their business processes, you should be very careful in evaluating a self-directed ERP implementation. For more information on this topic, please take a look at the blog Six Things to Consider Before Undertaking Do-It-Yourself ERP Implementation.
Once you’ve narrowed down the field of potentials to 3 or 4, it’s time to take a deeper dive with your short list. There are various approaches to doing this, and unfortunately, some of those approaches are, in my humble opinion, unnecessarily complex and convoluted while overlooking some critical elements. Choosing and implementing an ERP is a critical business decision that will have lasting impact on your organization, so much care should be taken in the evaluation. For my thoughts on how to structure a good ERP evaluation, please take a look at the blog Steps to a Successful ERP Evaluation.
In the next blog of this series, I will be focusing on why the implementation of your ERP is so important and share some thoughts on things to look out for.
About the Author: Mark Miracle is the VP of Sales for LogicData and has been personally involved in over 50 ERP selection processes over the past 3 years. LogicData is a Gold Channel partner for Infor, a leading enterprise software provider. Over the past 30 years, LogicData has been focused on helping SMB manufacturing clients implement the CloudSuite Industrial (SyteLine) offered by Infor.