7. Are there any specific areas of caution that department heads should be aware of when selecting an ERP system?
What is an ERP System?
An Enterprise Resource Planning (ERP) System is a software program that supports complex and integrated business processes. It assists with the requirements of enterprise businesses such as Human Resources, Accounting and Inventory Management.
Measurement of Successful ERP Selection
The successful selection of an ERP System requires careful consideration of many factors. Department Heads should assess their company’s current resources, project objectives and tools. Furthermore, they should be aware of certain tasks that the ERP System will handle and the capabilities of end-users.
5 Common Mistakes and solutions in ERP Selection
The following 5 mistakes are commonly made in the selection of an ERP System:
1. Selection of the Wrong ERP System
Mistake: Department Heads may underestimate the importance of a well-suited ERP System for their company’s future needs. This could lead to decreased performance, incompatible software and high costs associated with customizations or changes.
Solution: To prevent this, Department Heads should research their current needs and potential future needs for their organization. This serves to ensure the optimal fit for the ERP System.
2. Unclear Targets
Mistake: A mistake often made by Department Heads is setting vague or difficult to measure goals for the ERP System.
Solution: Department Heads should identify the exact business KPIs that they intend to track with the ERP System. This will allow them to accurately measure their success.
3. Missing Evaluation Criteria
Mistake: Department Heads may not outline the criteria they will use to evaluate different ERP Systems.
Solution: A best practice is to generate a list of ERP System features that the company desires and then grade the desired features accordingly. This will help the Department Head compare the different ERP Systems and make an informed decision.
4. Skipping the User Acceptance Test (UAT)
Mistake: Most Department Heads may ignore the importance of having a proper User Acceptance Test (UAT) prior to implementation. Without a UAT, it may be difficult for the Department Head to accurately recognize any potential problems in the ERP System.
Solution: Setting up a UAT should be a top priority. This will help to detect any possible bugs or user interface issues associated with the ERP System.
5. No Emergency Plan
Mistake: A major mistake that Department Heads can make is not having an emergency plan in place during the ERP System’s implementation process.
Solution: To prevent this mistake, Department Heads should document the steps they will take in the event of an emergency. This will allow the Department Head to better handle any unexpected problems.
Summarized Table of the Mistakes and Solutions
| Mistake | Solution |
|---|---|
| Selection of the Wrong ERP System | Research current and potential future needs. |
| Unclear Targets | Identify business KPIs to be measured. |
| Missing Evaluation Criteria | Grade desired features to compare ERP Systems. |
| Skipping the User Acceptance Test (UAT) | Set up a UAT to detect bugs. |
| No Emergency Plan | Document steps for potential emergencies. |
Conclusion
The selection of an ERP System is not an easy process, especially for Department Heads that are inexperienced in this realm. With this article, Department Heads can benefit from the knowledge of the 5 most common mistakes made during ERP System selection and the solutions to help prevent them. In order to successfully select an ERP System, Department Heads must take the proper steps to research their requirements, set goals and create an emergency plan. Implementing these strategies during ERP System selection will help to ensure the successful installation of an ERP System that meets the needs of both the Department Head and their organization.
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