How to Select Your Perfect ERP Vendor

By Sheila Shanker
Updated: August 22, 2011

An Enterprise Resource Planning system, also known as an ERP, can help businesses in standardizing procedures and centralizing information. This system is sold in modules to many industries, such as manufacturing, school districts and hospitals. The modules are interconnected and can be for Human Resources, Finance and Inventory/Sales. You enter data in one module, and that can be used in other areas, minimizing duplication of time and effort, streamlining processes. For example, an employee's name can be entered in the Human Resource module, and that can be used to approve Purchase Orders. Selecting a proper vendor for your ERP needs can be tricky. Below are some ideas to help you choose the right company:

  • Make a list of your must-have features to help you focus on your needs, rather than on the whistles-and-bells vendors may show you, but unrelated to your real requirements.
  • Solicit for referrals from other businesses that are happy with their ERP systems
  • Contact at least 3 vendors
  • Be sure the vendor can meet your budget limitations
  • Ask for demos CDs or online, so that you can experience the system working on a sample firm.
  • Verify that the vendor can meet your timeline to get the system up and going
  • Ask the prospective vendor how many ERP implementations it has done in the past with situations similar to yours – the more, the better.
  • Request references and check those up over the phone or through emails.
  • Run a Better Business Bureau report on the ERP vendor. You can do that for free at www.bbb.org.
  • Search for vendor online to check its Internet reputation in the marketplace.
  • Meet the ERP implementation members or at least the project manager to make sure it’s a good fit culture-wise.
  • Avoid dealing with multiple vendors that can blame each other when something goes wrong.
  • Select vendors that offer pre-configured and pre-tested systems that are easier to implement.
  • Inquire about training options, not only for existing employees, but for future hires as well.

Selecting an ERP vendor is important for you get the most out of your system. Be sure that the firm is reliable, stable and will be around for awhile, so that if you have problems, they can come in and assist you. You may decide to implement a couple of modules first and then get the other ones done later. This type of implementation limits your risk – if the vendor messes up with the first modules, you may choose to go to another one for the other modules.

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