Enterprise Resource Planning (ERP) software has become a critical tool for medium-sized manufacturing and distribution firms that want complete visibility into core business processes. ERP systems allow the seamless flow of information and data across different departments, which improves the efficiency of processes and the profitability of a business.
Whether you’re looking for distribution ERP or something else, choosing the right system is as important as deciding to implement ERP. However, with more than 520 options, how do you compare ERP systems to determine the best option for your business?
Before comparing ERP systems, you should have a clear understanding of the needs of your company–this is the first and most important step in choosing the best ERP system for your enterprise. Start by outlining the strengths, weaknesses, and struggles of your business.
Identifying the inefficiencies your business is experiencing will give you an idea of the types of ERP systems that can help you achieve future goals; this solves some of the major challenges of implementing ERP in distribution. Taking time to complete this step will narrow down the number of ERP systems needing to be compared, as not every provider offers the solution your business needs right now.
How to Compare ERP Systems
Once the requirements of the business have been clearly identified, you can compare the ERP systems available. Use the following guideline to properly compare ERP systems.
1. On-premise or Cloud-based
This is an important decision to make early on, as it will drastically reduce the number of ERP systems under consideration. If your business requires a traditionally installed on-premise ERP system, you can focus on providers in this category–the same applies to cloud-based ERP systems.
2. Modules Offered
The next step is to compare on-premise or cloud-based ERP systems that offer modules that match your business requirements. While there are basic modules of ERP, like finance, human resource, customer resource management, and procurement, there are also other industry-specific modules like professional services, manufacturing, and wholesale distribution. The ERP providers you compare should offer all the modules your enterprise needs now and might implement in the future.
After identifying the ERP systems that offer solutions to your current business challenges, pricing becomes the next major factor. Before comparing prices, you should know that ERP systems offer standard pricing that covers licensing, setup, and implementation of the software.
However, you may need to pay more for ongoing support and add-ons that can further enhance the functionality of the system. Your budget should cover the implementation duration as well as employee training and physical equipment (for on-premise systems).
The level of security offered by the ERP system is another important factor to consider during your ERP vendor comparison. Cloud ERP systems are often more secure, offering a level of security similar to that of banking institutions. However, for on-premise systems, you need to consider extra security measures for the protection of physical devices.
No two businesses are exactly the same. As such, you need an ERP system that can be customized to meet the unique requirements of your business. Some ERP systems provide more customizability in the form of add-ons. Your goal should be to find providers that meet all the requirements on your enterprise's checklist.
6. Vendor Reputation
At this stage, you should be left with only a handful of ERP providers. In many cases, the popularity of the ERP system doesn't guarantee the best ERP systems. As such, it becomes important to learn about their reputation through customer satisfaction and reviews.
Installing and using an ERP system is a long-term commitment that requires a lot of time and resources. While the guidelines provided above will make ERP system comparison less complicated, the ultimate goal is to help you find the best ERP system for your enterprise needs.