Enterprise resource planning is a critical function of most businesses. As with many jobs, ERP work is increasingly automated with software. Consequently, ERP software selection has become as important as the process itself. If you're looking for the right software to manage your company's resources, mind these six issues when it comes to selecting an ERP package.
Consultants often encourage clients to start by outlining the core functions of ERP within their operations. A manufacturer may have different ERP systems selection issues compared to a distributor, for example. The manufacturer may be more worried about the supply chain because their business depends on raw inputs. Conversely, the distributor may be more worried about contracts, inventories, and shipments.
You also should look at how modular the setup will be. Ideally, the package should allow you to choose only the modules that make sense for your business. For example, a company that exclusively delivers shipments with its own trucks probably doesn't want to pay for a postal shipping module.
Similarly, companies usually have existing hardware and software stacks. If you already use a particular system to handle accounting, for example, you probably will want the ERP software to integrate with it. Depending on how many types of software are already in your company's systems, it may take some work to find ways to integrate the ERP tools with everything else.
Most organizations have sensitive information in their enterprise resource data. The ERP systems selection process should include some discussion of security. A consultant can look at how exposed your systems are to determine the appropriate level of security. For example, a firm that's highly integrated with a live e-commerce website may need significant security tools to prevent potential breaches.
Technical support is essential whenever you depend this much on one system. It is a good idea to check customer reviews of companies to verify that they take care of tech support issues promptly and skillfully.
Your ERP package should also have access to regular updates. These might address security patches, regulatory changes, or integration issues. Depending on the package, there may even be feature updates. The best providers regularly roll out updates that work seamlessly.
The total cost of ownership for an ERP package also matters. TCO goes beyond the installation costs. If you need to pay for servers to host the software, that's part of the TCO. So too are licensing fees and support charges. You want the TCO to be as low as possible without sacrificing features.