You need a software solution that connects data from all departments, making reporting, analysis, forecasting, communicating, and decision-making a breeze. However, implementing a new ERP system can be intimidating. It’s a large investment and there are so many ERP options and configurations. So how do you select an ERP system?
In this article, we’ll cover how to select an ERP system, what to consider when selecting an ERP system, finding an ERP selection partner, and the next steps you’ll take on your journey to unify your business.
What Is an ERP System?
An enterprise resource planning (ERP) system is a software solution manufacturers use to integrate all parts of a business into a single centralized system. ERP systems are fully customizable depending on the needs and size of the business.
The benefits of ERP systems include streamlining business processes. ERP systems automate routine tasks and reporting allowing you to free up resources and letting your employees focus on more impactful activities.
ERP systems include various modules you can integrate with the software, including human resources, finance, inventory management, warehouse management, shipping and ordering, and more.
They can also integrate with third-party software like CAD software and Industrial Internet of Things (IIoT) devices for a 360-degree view of your business.
How to Select an ERP System
Selecting an ERP system is a big step in the right direction, but a big step nonetheless. Most companies opt for an ERP consultant to help them with the process.
1. Evaluate Your Business’ ERP Needs
Each ERP system is unique, just like each manufacturing business is unique. In order to select the right ERP fit for your business, you need to be very clear about what your business needs.
Consider these questions:
- Where are the bottlenecks in your business?
- What are your company’s biggest pain points?
- Which departments have the highest spending, and could they be lowered with ERP?
- What is your company doing well? Are there areas that you don’t need connected to ERP?
- What third-party software is your company currently using that you would like to continue using, and can it be integrated with an ERP system?
After you’ve identified your pain points, determine if these features of ERP can improve them:
- Automation: Perhaps the biggest resource-saver in ERP is its ability to automate tasks. What departments would benefit from automation?
- Operability: Does your team struggle using cutting-edge technology? Then you need to find easy-to-use ERP software with an excellent user experience. Also be sure to find an ERP consultant that scores high in user adoption training.
- Cloud vs. On-Premises: Do you need a cloud ERP solution that you can access anyway and from mobile devices? Or do you need to restrict data accessibility for cybersecurity by using an on-premises ERP solution?
- Reporting and Analytics: ERP systems can automate and schedule reports. They also include helpful out-of-the-box templates. Is your reporting up to snuff? Would advanced analytics be beneficial (hint: yes).
Write down your answers to these questions and discuss them with your ERP partners, including vendors and consultants. This will help your whole team ensure you choose the right ERP solution.
2. Assign Leadership Roles
Change management is always an uphill battle, so it’s important to get employee buy-in from the start. This means getting leadership from each department onboard early.
Assign your top employees leadership roles for the ERP selection and implementation process. Ask for their feedback, what their pain points are, and how you can help during the process. Your leadership team will act as the voice of your employees. Be open to hearing their ideas and concerns.
Encourage ownership from the leaders of all departments, because ERP will benefit all aspects of your business. This includes:
- Inventory
- Warehouse
- Marketing and Sales
- Finance and Accounting
- Human Resources
- Shipping and Receiving
- Operations
3. Assess Your ERP Choices
There is a wealth of choices when it comes to ERP software. For manufacturers, your biggest benefit is that there are several ERP solutions designed specifically for the manufacturing industry.
Here are some key considerations when searching through manufacturing ERP options:
- Reputation: What are the top ERP vendors in the manufacturing industry?
- Expertise: How much skin in the game do they have? How long have they been serving manufacturers and do they have excellent reviews?
- Configuration: Does the ERP software come with customizable applications that serve all of your departments?
- Growth: Is the ERP software flexible and scalable? Even if you start with a lightweight ERP solution, your company will grow and your software will need to be able to scale with your growing needs.
- Compliance: Does the ERP software align with industry regulations? Your ERP software should make your life easier when it comes to compliance.
We often work with top-performing ERP vendors like Infor because we’ve found their ERP platform to hit all these marks, but it’s highly dependent on your particular business needs.
4. Select Your ERP Partner
Before landing on an ERP vendor, it’s important to consult with an ERP expert. ERP consulting and implementation firms like Godlan are manufacturing industry experts. They will help you narrow down your options by reviewing your needs, goals, and the scope of your business. They’ll also be able to offer insights into ERP successes, common pitfalls, timelines, and the ongoing support you’ll need after implementation.
RELATED: Infor vs SAP: Which Is Better?
Other Considerations When Selecting an ERP System
There is a lot to consider during the ERP selection process. We think these are the most important factors based on our experience.
Make Sure Your ERP Choice Integrates with Your Current Software
There is software your teams use that they will continue to use after ERP implementation. For example, CAD software and IoT systems are often independent of your ERP system. But they shouldn’t be.
Talk with your ERP partner about the capabilities of your chosen software. You’ll want to be able to collect, store, and analyze data from third-party systems within your ERP system to get a holistic view of your business.
Check Out Reviews and Reputation of Your ERP Vendor
As with any product, search for reviews and case studies of your ERP vendor. Look for the good and the bad, what worked for others and what didn’t.
Consider Your Budget
We believe ERP systems are game-changers for manufacturers, but it’s important to stay within your budget, especially in the beginning. ERP solutions will help your business grow by streamlining processes, increasing efficiency, automating routine tasks, and lowering costs. Find the best solution for your current situation and upscale as you grow.
Make Sure Your Data Is Clean
This is crucial and will require some hard work from your IT department. One of the biggest ERP pitfalls we see is companies attempting to migrate messy data from their old systems to their ERP system. The fact is, if you don’t work on data cleanup now, you will have double the data cleanup to do after implementation. Our ERP experts can help with this vital step.
Create an Implementation Roadmap
Work with your experienced ERP consulting firm to create an ERP implementation roadmap. Having a plan will set your team up for success, and your ERP consultant will be able to identify any areas you miss, from change management to data migration.
Let Us Help You Select the Right ERP System for Your Business
With so many considerations, ERP selection can feel like a migraine. Don’t worry. Godlan has over 35 years of experience of hands-on ERP implementation. We have never failed to finish an implementation for a single client. If you have questions, we have answers. Contact Godlan today for world-class service in ERP selection, implementation, and ongoing support.
