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ERP: 8 Steps to Success


This document is intended to guide you through the steps that any buyer needs to take when considering which ERP (Enterprise Resource Planning) Software is right for them.

• Plot customer/contact pathways

• Profile interest areas and create customer personas

• Examine the content that you offer and map it to your sales cycle

• Look at customer follow-up plans

• Think about the different needs of your small client, key accounts and prospects (content, comms, routes etc.)

• Interview Call Centre/Customer Service teams and discover what’s frequently coming up.


STEP 1: Research

You may have some existing knowledge of ERP software or it may be entirely new to you. In both cases, this guide will help you to decide what system will work best for your business.

The guide will help you to gain an understanding of the various flavours (on-premises & web-based) that exist for ERP software; what the system functions are; a better sense as to how they will assist and improve your business; and an idea of what the cost will be.


STEP 2: List And Prioritise Key Functionality

It is important that you list and prioritise before making any decisions on your software requirements. The tasks include:

• Identifying key functionality

• Identifying your current systems limitations

• Creating a list of requirements

• Assessing this list with staff

• Prioritising which functionality is key to your business

There will be some functionality in ERP software which is essential to your business and other areas which should be considered to be “niceties”, so prioritising is important. This guide is here to help with this, identifying the important tasks that you wish the software to cover.

You will no doubt already be aware of the limitations of your current software systems. Together with your co-workers, you will need to make a list of everything you feel that your new software needs to do.

Once you have this list, you will all need to agree as to which items are the priorities and, therefore, will need to be covered by your new system. This vital information will be key to selecting the new software.


STEP 3: Build And Present A Case For Your New Software

The new software will be a significant investment so it is important for you to see a return from it. The tasks at this stage include:

• Identifying who will need to approve your decisions

• Making them aware of the key issues and current system shortcomings

• Presenting to them a justification as to how your new system will address these issues

• Calculating the cost of the new software

• Ensuring that you have approval for the new software

You should by now have a clear idea of your requirements and some early views as to which systems may be a good fit. If you are in control of the purse strings then you can probably go ahead with the next steps, otherwise, you will need to build a business case.

A strong case put forward to the right people is essential to ensure that you gain approval for your new system. You will need to highlight current challenges and system issues; what the advantages are for the new functionality; and how the new system will deliver measurable benefit.

The benefits clearly need to outweigh the costs. Ensure that the costs include training, service, and licenses and keep in mind that there may be some cost associated with changes in your organisation. Your presentation needs to show that the new software will benefit in areas such as reducing errors, better client care, improved cash collections and, if appropriate, regulatory compliance.


STEP 4: Shortlist Of Vendors

Narrowing down your selection of vendors is crucial, your list of requirements and budget will be key inputs to this. The tasks include:

• Identifying which vendors work best for your business size

• Determining which vendors are suitable for your industry and specific area of business

• Finding vendors which best address your key requirements

• Choosing vendors which are within budget

• Creating a vendor short-list

There are a significant number of ERP software vendors out there, which may seem a good thing on the surface. However, you’re going to need to build a shortlist of only a handful. Evaluating a large number in depth is far too time-consuming and not cost-effective, so you should be looking to have no more than 5 on your shortlist. Ultimately you will find that only a handful are going to be relevant for you.

This stage is critical in finding what works best for your business so be prepared to invest a few weeks in the elimination process. Firstly eliminate the vendors who don’t serve your sector or specific line of business. Next, armed with your list of requirements, you can further reduce the list. Budget is obviously the next key factor so ensure you get a good idea of price; this should significantly reduce your shortlist.


STEP 5: Interviewing

It is important that you speak with each short-listed vendor. The tasks include:

• Ensuring that the vendors understand that they are being evaluated

• Confirming that the vendors understand what is required of them

• Ascertaining whether the vendors are aware as to what other systems you are considering

• Presenting your list of requirements to them

• Making them aware of your timeline and evaluation process

Each vendor will need to understand exactly what your business does and how it is achieved. Ensure that they are aware of your requirements and expectations, not only of the software but also from them as a vendor.

The vendor needs to know what is important to your business and which requirements are most critical. This way they can focus their efforts on demonstrating how their software can assist in those areas, as well as other functionality that may be valuable but is not necessarily essential.

Don’t be afraid to share your selection process with the vendors. They will be aware that they are up against others in competing for your business, so make sure that they know exactly what you need and when. This will avoid any misunderstandings and ensure they are in the best position to deliver your requirements.

Many vendors don’t allow trial periods of their software and because of the way in which it will need to be implemented, and even integrated with your existing systems, a trial period would almost certainly be more disruptive to your business than valuable.

With no trial period, ensuring that the software vendors provide adequate demonstrations of the software performing the specific tasks in which you are most interested is essential.

You need to get a good understanding as to what the system looks like, how it performs and how interactive it is. It may look slick but could, in practise, be cumbersome to operate, so it’s essential that you see it in action.

Pre-advise the vendors that you will be wanting to see their system perform specific workflows that are core to your business. This way they can have the appropriate demonstrations prepared.

Ensure that the right people are present, for example if the demonstration is for order management, make sure that staff who deal with this on a daily basis are available to attend the demonstration. They will also need to have some “hands-on” time so that they can make a decision as to whether they feel comfortable to work with it on a day-to-day basis.

You and all of your staff need to keep track of your impressions of the software. Using a rating system for various areas e.g. “Look”, “Feel”, “Responsiveness” is a good idea. You may want to prepare “scorecards” for all to take with them to the demonstrations. Make sure that you are also rating the vendor as well as the software. If chosen, you will have to work with them throughout the implementation period and in the context of on-going support.


STEP 6: Ranking And Eliminating Vendors

You can now rank and eliminate vendors. The tasks include:

• Choosing vendors who can deliver the required functionality

• Eliminating those who can’t address key requirements

• Deciding which software is best to use

• Ranking the vendors themselves

• Final shortlisting for deeper evaluation

Following the demos, you and your team should have a good feel as to which software and which vendors you prefer. It is important to see through any “glossy packaging” at this stage and remain focused on your requirements. Your choices need to include those who can provide all of your key requirements, in addition to any “niceties”.

Gather and tally up all of the scorecards used during the demonstrations to identify which systems performed the best. Also, make sure that you discuss these areas with your team as some may have different views for a variety of reasons. If you’re still undecided, consider calling the vendor back for further demonstrations.

Software License Agreements vary from vendor to vendor so ensure that the contract has been thoroughly read and understood before any agreements are made. This is also a good time for negotiation so if you’re unhappy with something the vendor is proposing, make sure this is discussed and an agreed compromise or price adjustment is secured.

It is normal for most companies to provide discounts. The more business you agree to give them, the greater the discount. Keep this in mind when negotiating but also remember that some providers may not operate in this way and may have standard pricing across the board.

You shouldn’t be worried about offending anyone by asking for a discount, it is, after all, a normal part of business. As with the Software License Agreement, the terms and conditions of your contract also need to be read thoroughly and understood. Ensure that there are enough licenses for the size of your business and be wary of any clauses detailing automatic renewal. It is also sensible to have some kind of “get-out” clause in the event that things don’t go well, or if the vendor fails to deliver as agreed.

It is always wise to have a legal professional review any contracts and related material for a decision of this magnitude.


STEP 7: Comparing Quotes

You will now need to ensure that you have accurate quotes from all vendors for comparison. The tasks include:

• Furnishing vendors with all requirements and numbers

• Asking remaining vendors for final detailed price quotes

• Asking remaining vendors for Software License Agreements

• Comparing quotes

• Negotiating discounts

• Understanding what your licenses cover

• Checking agreements for adverse clauses

• Comparing on-going and up-front license costs

• Insisting on “get out” clause

The price shouldn’t necessarily be the reason you should ultimately choose one vendor over another, but the detailed quotes from each will certainly play a major part in your final decision. If vendors are aware that you’re deciding between a number of them, you may find that some are able to offer a more competitive price. Bear in mind that you can negotiate in order to ensure that you receive everything you require at the price you want.

Some costs such as training, support, licenses and customisation may not be quoted up-front by a vendor, so ensure that the detailed quotes you request from them include absolutely everything.

Also, make sure that you understand exactly what is required as far as hardware and other equipment is concerned, and that these are also included in the quote. Some of this may be from third parties so this is something to be aware of.

There are numerous pricing structures in existence including subscriptions, up-front licenses etc. so keep your overall long-term budget in mind when comparing quotes that contain different models.


STEP 8: Practicality And References

You should now have decided on which software vendor you will be choosing, subject to some final checks. The tasks include:

• Informing your preferred vendor that they are your current choice

• Obtaining references from 2 similar businesses

• Ensuring that the vendor is a practical choice

• Discovering the referee’s dislikes about the vendor

• Finding out how the vendor performed when issues were highlighted

Speak with your chosen vendor and explain to them that, subject to some final verification steps, they are your preferred choice. You need to be absolutely certain that what they claim to be able to deliver, is indeed possible within your given budget and time scale.

Ask the vendor to supply two references from companies they have dealt with, which operate in the same area of business and are of a similar size to yours.

Once you have the references, you have the opportunity to find out more about the vendor and how they have performed in the past. Make sure you ask the referees pertinent questions which dig deep into their experiences. In particular, you will be interested in whether the vendor met deadlines and how they performed.

If there were any problems encountered during any stage of the process, find out what they were and how well the referee felt that the vendors dealt with them. Also, ask them if there is anything they would change about the vendor’s service or the software itself.


Finally, make sure that the vendor won’t leave you in a predicament during or after your installation. Don’t be afraid to ask them about their financial situation and strategic viability and perform some independent financial checks to confirm their stability.



If you need help preparing the right vendor shortlist, get in contact with one of our software experts now.


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