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In our previous article, "Is it time to rethink your ERP?", we explored the critical factors to evaluate when considering a migration from your current ERP system. If the decision to migrate is made, the next challenge is selecting a solution that aligns with your organization's current requirements and future goals.
So, how do you structure the next steps? In this article, we outline the methodology we employ to guide our clients through this process.
Benefits of a successful implementation
The primary goal of an ERP is to integrate an organization’s various processes, promoting efficiency by centralizing and better organizing data, facilitating decision-making, and enabling the adoption of technological innovations.
According to Gartner, organizations that have successfully implemented a new ERP experienced a 75% improvement in IT agility, both in response times and in the ability to react swiftly to the organization's various strategic demands.
Successfully selecting and implementing an ERP can bring significant benefits to an organization, such as:
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- Cost reduction: Through the incorporation of innovations, process optimization, and reduction of manual activities.
- Risk and fraud mitigation: Processes become more controlled, adhering to best practices, legislation, security rules, and compliance.
- Faster decision-making: Centralized, integrated, and more robust data allow for greater maturity in management by metrics.
- Increased market value: According to Gartner, acquiring a mature ERP can double an organization’s valuation, which is critical for companies seeking external investments or even an IPO.
- Unlocking innovation potential: When integrated with the technological architecture, an ERP can unlock a company’s innovation potential, keeping it competitive in an extremely dynamic business environment.
Despite the numerous benefits, organizations still face many challenges on this journey. During the selection stage, for example, it’s often difficult to assess how well different ERPs on the market align with the organization’s strategic objectives.
Additionally, during implementation, failures are common. According to Gartner, only 26% of ERP implementations achieve the expected success.
Our approach to ERP selection
Given the inherent complexity of selecting such a significant software solution, we recommend that organizations embarking on this journey conduct a thorough evaluation of the available ERP solutions and select a technology provider through a structured and robust Software Selection method.
Below is the approach we adopt in our projects to maximize expected benefits and minimize the associated risks:
1. Start by understanding the current and future business goals
The first step is to understand the context in which the company is operating. This includes identifying the competitive advantages that are essential for its current and future success.
2. Immerse yourself in understanding the current situation
In this step, it's crucial to understand the company's current state and needs. It's important to get a clear picture of the organizational processes, systems, and challenges at play. By mapping out these key aspects, you'll gain the insights needed to start identifying solutions.
3. Proceed with gathering functional and non-functional requirements
Functional requirements relate to the processes identified in the previous step, while non-functional requirements focus on performance, security, and scalability. It’s essential to involve key stakeholders in this phase to ensure that all expectations and technical demands are captured for the solution design.
4. Have a structured methodology for evaluating vendor proposals
During this phase, carefully review and compare vendor proposals. Make sure to conduct detailed evaluations and focus on how the proposed solutions align with the business objectives and the established requirements.
Throughout this process, it’s crucial to involve and engage the appropriate stakeholders. Their participation from the very beginning of the selection process is essential for aligning expectations and ensuring acceptance of the chosen solution.
Conclusion
Selecting an ERP is a complex task that requires diligence and careful planning. By addressing each step with the necessary attention and considering the intrinsic challenges, organizations can maximize their chances of choosing a solution that drives their growth and delivers the desired operational efficiency.
If you want to learn more about how Bridge can support you on this journey, contact us to continue the conversation.