So, you’ve outgrown your current Enterprise Resource Planning (ERP) accounting system. Whether it’s your first or not, you need a solution that’s going to meet your organization’s needs much better than whatever you are using today. You need a system that will solve for the workarounds, manual steps, or data inaccuracies currently plaguing your operations.

It can be tempting to simplify the task of choosing an ERP system by going with one of the “big guys” like SAP or Oracle, or by choosing whatever solution your industry competitors are currently favoring. But beware that there can be drawbacks to such a decision. You may end up paying for functionally you don’t really need.  Or you could end up making a lot of expensive customizations to your system to force it to fit your specific requirements.

While it does take some time and effort to determine the best ERP for your unique business needs, trust us, it’s time well spent. We’ve seen many businesses skimp on the planning process and end up spending double or triple the time and money on rework down the road. To avoid such a conundrum, make the selection process a priority.

Follow this game plan to ensure your business gets the right ERP solution, right from the start.

1. Define your expectations.

Ask 20 business leaders to define ERP and you will end up with 20 different definitions. But the only one that really matters is yours. ERP is traditionally associated with financial and accounting functions, inventory management, and non-customer-facing solutions. However, today, organizations are using such systems to manage all types of business data including HR and CRM information as well as to run the backend of customer-facing programs and technologies ranging from self-checkout systems to loyalty programs. In short, there’s not much that happens in any realm of your business that an ERP can’t or won’t touch. But it’s up to you to define what you want and need your system to do and create your unique business case for your ERP.

Determining these functional requirements or business goals of the solution is typically a group task, and it’s important to get all the right people in the room. Even if the finance or IT department is leading the charge, remember that an ERP solution will affect every business function in one way or another. Creating alignment around everything the solution needs to do for the business will lay the foundation for success.

It can be helpful to solicit an outside, vendor-neutral opinion to assist in fully understanding functional requirements. A non-biased advisor can help take into account all departments’ needs, prioritize requirements, and build organization-wide consensus around the type of solution the company really needs.

2. Decide what you’re keeping and define your future state.

Investment in a new ERP is often driven by business and technical requirements that are not currently being met. Maybe something has stopped working efficiently, there is new functionality that needs to be adopted, or your company has new business requirements that need to be supported. In many ways, creating the list of your business requirements is the easy part of creating a best of breed environment. However, most businesses have existing internal or third-party solutions that continue to work very well for their intended purposes. You don’t necessarily need to give these up or spend time and money reinventing the wheel. What you do need to do is decide which current systems you want to keep so you can determine how they will integrate with and share data with your new solutions. It’s perfectly acceptable for a legacy system to feed the new larger ERP system, especially if the legacy component already does a great job of meeting a specific need or the new solution lacks that particular functionality. We have seen companies spend a great deal of time and money to customize a new system simply to force it to do what the old technology already did, and in many cases, did better.

Furthermore, even the most robust ERP systems require additional connections, inputs, and middleware to manage and run a business. It’s rare to find a single system on the market today that will do all the things you need it to do without some desired customization. In most cases, the final answer ends up being a collection of modular systems.

Doing the homework to determine how much work it’s going to take to marry those various modules—both old and new—is one of the most important parts of defining the technical requirements of your ERP solution. Unfortunately, this step often does not receive the attention it deserves. Many companies have gotten themselves into trouble by finding out, late in the game, that old and new systems are not compatible. For example, when Hershey implemented its ERP system, failure to fully integrate the production system led to missed holiday deliveries and a lot of Christmas stockings without those delicious chocolate Santas peeking out from the top.

To avoid similar headaches, put the time into defining the integrations that will be necessary. Make these mandatory requirements for any new solutions you consider.

As you are thinking about the future, don’t forget about the past. System decommissioning also requires serious consideration and planning. It is never as easy as turning the old system off. There are multiple reasons to ensure you have data or systems available for a period of time after the new ERP is deployed; if the system is gone too soon, it can be too late to recover valuable information. However, when the time is right, you need to ensure that the old system is truly decommissioned and not just forgotten, potentially incurring ongoing maintenance costs. A strong plan takes into account all the implications needed and appropriately schedules the decommissioning.

3. Assess your organization’s tolerance for change.

Anytime you introduce a new technology or system, it’s going to change business processes. In general, people dislike change and you can expect some degree of grumbling and even some pushback. But if key players in your organization are extremely opposed to modifying workflows and methodologies to support new technologies and systems, then it’s best to find that out and address it sooner than later. Executive sponsorship, with an emphasis on change management, is critical to navigating the journey. Most modern ERP systems are built to support business best practices. So, the changes your organization will need to make to accommodate the systems are going to be mostly positive for your company. Still, it’s important to weigh the pros and cons and carefully consider both the short and long-term implications of process or methodology changes that will be required. Going through this exercise and documenting the findings can help you demonstrate that you’ve considered the various stakeholders’ concerns. It can help you make a compelling case for change to the organization and ultimately gain the buy-in you need.

Of course, it is possible that you will determine that it is the system that needs to change, and not your established processes. Tread carefully here. Customization of modules is always possible, but it comes at an initial and likely ongoing cost to the base product. And too much customization could break the system and lead to problems and glitches with critical functionality.

The bottom line is this: if you are going to customize the system to fit your processes, you need a better business reason than simply “it’s the way that things have always been done.” And you need to fully consider the downstream ramifications for all business functions. If you start getting into the territory of too much customization, it could be a sign that the technology you’re considering is not the best choice or that the processes you are trying to preserve may need to evolve.

4. Submit and Score RFI/RFPs.

Once you have done the legwork to define functional and technical requirements and map out what the ERP system will look like in your business, it’s finally time to go out into the marketplace and look for the solutions that will meet your needs. Obviously, the more detailed your requirements, the narrower the playing field will be. But you will likely still have many contenders to consider. Again, a vendor-neutral advisor can help steer you toward the best options. When the responses come back, an advisor can also help you implement an objective methodology or system for scoring them against your requirements and priorities. It’s important to consider not only the current and future functionality each option offers, but also the implications for legacy systems, operations, and processes, taking into account your organization’s change-readiness factor.

Ideally, you will pare down the list to two or three final options. This is the time to schedule demonstrations and to make sure that key people from various business functions have the opportunity to experience the technology at work. If you did the work to create alignment around the business case for the ERP and your key requirements, this is also a great time to resurface that checklist, remind the team of your priorities, and use your scorecards to hopefully arrive at unanimous (or at least close to unanimous) consensus around your final choice.

Implement your ERP solution with confidence.

You’ve no doubt heard the stories about ERP implementations gone awry. And we’ve certainly been called in on many occasions to help sort out unexpected hiccups that arise during the process or in the early operations phase. Time and again, the problems stem back to improper planning.

By following the roadmap above, you can lay the groundwork for a smoother, less stressful experience getting your ERP solution up and running. And you can help ensure that your investment ultimately delivers the results you expect.


Want more advice on how to ensure a great implementation? Check out this post on common ERP implementation pitfalls to avoid: 5 Ways to Keep Your ERP Implementation from Derailing.

Gabe Olives

Gabe Olives

Chief Information Officer

Gabe Olives is a POS and payments guru and an undeniable industry expert in the convenience channel for technology, fuel management, legislative affairs, POS/BOS and payments.

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