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You may have seen or read an article I wrote recently (ERP: What does it mean to us today?). I posed a number of questions about ERP in today’s agile and changeable world. What I did not look at was what it still can do for organisations. To answer this question, we first of all have to understand what an ERP package is.
I have spent the last few months analysing ERP packages for a market update using the Bloor standard RFI approach to gather information about different types of software. It is based on a scientific approach to valuation of criteria in the production of a “Bullseye” comparison of products. So the first thing to say about evaluating ERPs is that it isn’t just about the support for business functionality, it is also now about the platform on which the business functionality is delivered, because this is where the required agility and flexibility will come from. In addition, it is important to know about the support and services that surround the applications. Here we are looking at not only the maintenance services available, but also the implementation support through both a vendor’s own consultancy services but also through system integrators and lastly the training and education made available. There are other criteria but these 3 are the most important.
Figure 1: The Bloor Research High Level ERP Selection Criteria Weightings
Now when it comes to business functionality, what my recent research has shown is that there are certain packages which are better suited for different types of manufacturing such as process, project, make to order, repetitive or repair. So make sure that the packages you consider understand the sort of business you are in.
In the previous article I showed a picture of the common functionality; what my research has shown is that there are a number of ERP packages on the market that still don’t have Financial and HR modules. The other modules not always present are Plant Maintenance, Service management and Laboratory Information Management. So if these latter 3 are important to you then check that the packages you are looking support this functionality. The other thing I have noted is that analysis around pricing and competition is not always supported and here I think vendors really need to step up to the mark because these capabilities are very important to companies in today’s world.
One further word of warning to those of looking at choosing a package at this moment—a lot of the information you want is not on the vendor’s web sites or it is hidden deep down! What a surprise! I would always recommend that an organisation puts together a formal RFI of some sort as this allows you to understand what is important to you and allows you to collect the necessary information to be able to ask intelligent questions when you go and take a look at the product through a sales presentation. You can shorten the time to produce an RFI by using criteria used by industry analyst such as Bloor, if they are put into the public domain.
So what should you expect from an ERP solution today? Well, firstly a rapid implementation that will lead to a rapid ROI. This will mean you might have to change some of your processes to fit the best breed processes that are in the packages. This is all about don’t configure just because you can. Only make configuration changes to the package where the process is what really differentiates you from your competitors. In one selection I did, the key differentiator was the company’s discounting process and in another it was the supply chain in terms of bin management and transportation. So it was here that we did our configuration and left the financials as they were—what a pity the UK does have a standard chart of account as France and Spain so!