Most CEOs struggle when they must choose an ERP for their business. This is understandable to a good extent if it is a large, diversified transnational corporation, where collecting the business requirements Itself will take several months. Because of the huge budgets involved and the range of requirements, Identifying the right product and getting it implemented is going to take a few months or years. A wrong decision can set the enterprise back very badly.
We are talking about small business here. For them, staying in the game is far more important than leading the pack. The risk of blindfolded decisions – those made in the absence of the right data – on a routine basis will put the business at a bigger risk. A risk that a good ERP, even if that is not the ‘right’ ERP, can mitigate to an extent.
So, what is the right thing to do?
Let us look at some of the typical presumptions around an ERP decision
This is a major investment and we do not want to hurry up with that
Most ERPs now come in the subscription mode, unless you are a very special business , in a very special domain. Therefore, the capex decision is no longer needed. The ERP becomes another bill to pay regularly. It is cheaper to try them out, without rocking the boat. However, this does not mean that you are forever going to be switching ERPs! The parameters to choose the ERP do not change, except that the financial aspect has become a less important piece in the decision.
We are not sure what we want, and so we would first study our requirements
This is an often-repeated excuse for not making the ERP decision, though without much merit in it. While there is absolutely nothing wrong with taking this approach, business realities would suggest that this is not optimal. The practical difficulties and timelines involved in doing this with one’s own staff members must be considered. They have their routine work to attend to and hence, the study will go on for long. Even if an external consultant is hired to ‘speed-up’ the process, the abovesaid constraint will remain. And if such a study does take place, it is only going to tell a part of the story, as various biases could get into it. If conflicting requirements are not resolved properly and aligned to the CEO’s vision, the study may end up as a waste of resources.
The best way is to let the ERP vendor carry out your business process study in a reasonable timeframe and try to get all stakeholders onboard to the extent possible. And the least harmful way to find hidden and missing processes is to implement an ERP. Seeing is believing and you are not going to be any wiser by being extra cautious, especially when no big-ticket investments are needed. On the other hand, you are only standing in the way of growth by delaying the introduction of ERP.
We know that it is tough to move from one ERP to another…
The answer is yes, and no.
Well, since any ERP will produce structured data, moving it to another one is not difficult to do. There are newer approaches and technologies to enable it.
Any ERP implementation takes a while to really start giving visible gains – in terms of efficiency, responsiveness etc. If doubts are expressed about the ERP too soon, it will only muddy the waters. If an ERP fails to work as expected, the first question to be asked is: “ is the implementation all right?”, before asking “did we buy the right ERP?”. Implementation mistakes can be corrected in most cases, with a re-implementation in bad cases.
You are not going to be much wiser moving to another competing vendor’s product, if you have not resolved the above questions. However, if your analysis proves that the ERP that you chose is too complex and unwieldy for your needs, waste no time discarding it. Otherwise, it has the potential to cause business disruption, lost opportunities and lower employee morale.
Brought to you by CrestERP