ERP Selection

1. ERP Selection

2. Choosing ERP • Although major vendors have been selling ERP software to billion dollar companies for a while, the selection of suitable package for particular company is a weird process. • Off-the-shelf solutions seldom fit perfectly.

3. Choosing ERP • Most executive need guidance to help them choose an off-the-shelf ERP package, alter it and over see the change. • Financial executives might use these guidelines to reduce in size their businesses and make wise choices when buying and implementing ERP

4. Choosing ERP • Companies use ERP software to facilitate the exchange of information throughout an organisation. • Vendors tend to sell it in suites containing modules such as audit trail, payroll, purchasing, point of sale, manufacturing, inventory, etc.

5. Choosing ERP • In selecting ERP software for particular company, financial executives and CPAs need to know some issues as follow: • Whom to Buy From • What consultant can add • Locking and Leasing Options • Troubleshoot Early

6. Whom to Buy From • Midsize companies buy ERP in one of two ways: directly from software vendors, or indirectly, through a value-added re-seller (VAR) • From SearchITChannel.com defines VAR as follows;

7. Whom to Buy From • “In the computer and other industries, a VAR (value-added reseller) is a company that takes an existing product, adds its own "value" usually in the form of a specific application for the product (for example, a special computer application), and resells it as a new product or "package." For example, a VAR might take an operating system such as IBM's OS/390 with Unix services and, adding its own proprietary UNIX application designed for architects, resell the package to architectural firms. Depending on sales and installation requirements, the VAR could choose whether or not to identify OS/390 as part of the package ” Source: SearchITChannel.com

8. Whom to Buy From • Whether you purchase directly or through a VAR (such as Ingram, Micro, Gates) depends on what products you looking for and what support you need. • Many midsize companies prefer to buy from mid-market vendors such as Solomon who understand and respond well to a midsize company’s budget and culture.

9. Whom to Buy From • Software vendors recruit and train VARs, but some have closer relationships and rigorous demands than others. • A VAR usually shares a percentage of its sales with the major vendor whose products it sells and customizes for its clients

10. Whom to Buy From • Customers should ask how much technical support the VAR can be provided, since that can be critical to a successful ERP implementation. • However, Mid-Market vendors may not have as many resources for ongoing support and product upgrades as the largest vendors do • The largest vendors

11. Whom to Buy From • Most large and many mid-market vendors offer modules geared to the needs of particular industries such as manufacturing or distribution. • If a company has very specific needs in mind when it begins looking for an ERP package, it may want to work directly with a mid-market vendor that is experienced in designing a suite that meets needs of its industry.

12. Whom to Buy From • Some financial executives may prefer to shop for an entire ERP package directly from a mid-market vendor to know about the differences between packages firsthand and make decisions without the help from third parties who might be biased. • The buyer can hire a consultant with expertise in the chosen software to help with the selection and implementation.

13. Whom to Buy From • ERP decision makers should be aware that while VAR also can do some consulting functions their advice as consultants could be biased to a particular supplier.

14. What consultant can add • An industry expert may be better able to determine which suite will work well for a given company. • An expert in a particular module may know more about how to get that software up and running. • Consultants are generally more independent than VARs but still many are more familiar with one vendor’s product than others’.

15. What consultant can add • When choosing a consultant, a prudent ERP decision maker should inquire about that consultant’s financial ties to the software vendor it recommends.

16. Locking and Leasing Options • The company that purchase all the modules does not have access to any module until it pays for the “key” to it. • Instead of buying, some companies lease ERP modules or suites in which they might rent the modules they need. • This save on equipment cost and Implementation cost

17. Locking and Leasing Options • With this the responsibility of ensuring that the system is kept running is on vendor. The company is not aware all behind the scene. • But this may involve considerable expense and inconvenience; if that vendor changes formats, the company has no choice but to do the same.

18. Troubleshoot Early • After ERP suite has been chosen the company must know will implement it and keep up-to-date. • Even the ERP choice that the company has is great, it is of no meaning if there is no one with know-how to instal and maintain.

19. Troubleshoot Early • Before the company commits to a particular ERP package, the decision makers must know the IT people needed to implement and upgrade it – whether they come inside or outside the company. They must available and affordable.

20. Troubleshoot Early • An adequately staffed consultant or VAR offers troubleshooting support to the ERP purchaser. • Some VARs offer rapid implementation packages, which are supposed to get the ERP system up and running more quickly.