Enterprise resource planning (ERP) system evaluation is a significant task; you, your selection committee, and other stakeholders must take into account a wealth of operational data.
By compiling this useful list of ERP evaluation criteria for you, we’ve attempted to lessen some of the problem. It is based on our thorough research and actual user data from ERP selection projects in our technology selection management (TSM) platform.
Use the major ERP evaluation criteria and functionality checklist on this page to help you start your ERP research in the proper direction.
When you’re prepared to begin ranking your unique ERP implementation requirements in order of importance, use this form. You also receive a fantastic requirements management solution that you can use for free to handle the entire ERP requirements and review process.
View the complete list of important ERP functionality evaluation criteria:
Evaluation Standards for ERP
Depending on your organization’s demands, your ERP software should satisfy all or most of the following requirements:
Relationship/Account Management with Customers
Make sure the CRM module enables users to view clients from a variety of custom perspectives, such as products, geography, account type, and others. A good CRM module should make it simple to access essential ERP data from any device at any time.
Your AP team will receive adequate reporting from good ERP systems, allowing for more effective collections and simpler account ageing evaluation.
Reconciling the Banks
For your company to reconcile bank statement balances with the amount in the cash accounts in the general ledger, your prospective ERP solution needs to have a feature called bank reconciliation.
A system to handle and monitor participation in benefit programmes, including as insurance, compensation, profit-sharing, and retirement plans, is required for your ERP.
CRP (Capacity Needs Planning) A CRP module is crucial for your ERP if you need to ascertain the resources needed to meet production requirements.
Certain businesses need production planning, scheduling, and an inventory control system. MRP (Material Requirements Planning). Check to see if this module is present in the ERPs you are considering if it is a need as well.
BOM (Bill Of Materials) (Bill Of Materials)
Do bills of material have to be used when generating production orders to produce goods? If so, be sure the ERP you are evaluating has this feature built in.
Having logistics management in your ERP is a key component because it is necessary for all of your organization’s planning and execution. An ERP doesn’t meet my criteria if logistics management isn’t a key component.
BI (Business Intelligence) (Business Intelligence)
Business intelligence needs have already been discussed, and many of the best BI tools are standalone items. But, your ERP can also incorporate BI. Whether you use the BI features in your ERP or choose a stand-alone, best-in-class BI product depends on your organization’s preferences.
There are numerous systems available for email tools. If you’ve implemented a separate CRM, you probably already have them because they’re part of the fundamental needs for CRM. But, if your ERP doubles as your primary CRM (as mentioned above), check to see if the product’s feature set includes reliable email tools.
Once more, whether your ERP serves as your point of commerce or you choose a stand-alone commerce platform depends on organisational preferences.
Having advanced allocations capabilities in your ERP is essential if you want to reduce closing cycles, increase financial reporting accuracy, and boost overall efficiency.
Payroll and tax filing under tax administration
As tax administration technology naturally saves your finance team’s time, money, and effort, you need it as a fundamental component of your ERP solution.
Managing Engineering Change
Your company undoubtedly has a basic and ongoing issue in managing your products, manufacturing, and business operations. A strong ECM component ensures that the difficulty is handled as effectively as possible. The system should feature an ECM with centralised logistical capabilities that can be utilised to alter different production fundamental data elements based on certain circumstances.
Credit Management for Clients
Your ERP system must be able to track continuous sales activity for customers classified as requiring credit hold evaluation for sales and report on a customer’s credit standing for any given time period.
Manufacturers have superior insight into completion through all levels and throughout the whole supply chain thanks to the Available-To-Promise (ATP) software module. Although many firms want this feature to be standard in their ERP, it may be optional for your company.
System for Advanced Planning (APS)
With APS, you must monitor expenses based on the processes that generate them throughout the manufacture of manufactured items. In order to balance demand and plant capacity, it should also be able to allocate raw resources and production capacity optimally.
If you work in manufacturing, you’ll need tools that enable flow scheduling for production, replenishment, and inventory as well as lean manufacturing.
The capacity to automate practically any company function will be made possible by business process management (BPM) software. Your choice of an ERP system will depend on this.
Design of Flexible Networks
A flexible network design is typically a crucial and included component of any top ERP choice and can boost the effectiveness and scalability of a supply chain module.
To integrate all of the key business operations, your chosen ERP package needs connection between modules and optionally (but frequently required) additional 3rd party platform APIs. In order for BI to report on organizational-wide results, information should flow throughout the organisation.
Type of Installation
Most likely, you’ll have to decide between an on-premises or SaaS ERP installation. Make sure you carefully consider your organization’s preference because both have advantages and disadvantages. What implementation services are available, what maintenance contracts/on-site maintenance options are available, etc., should all be taken into consideration as part of your review.
The following support options should be present in any top-notch ERP: forum/community support, phone and email, chat and instant message. Given how essential their ERP system is to your company’s capacity to operate at its peak, great support would include 24-7 availability. Support should also come with comprehensive end-user training materials and development tools.
Training It goes without saying that ERP is a cutting-edge technology with a wide range of prospective modules you’ll wish to use. Make sure that all potential ERP vendors on your list provide both initial and ongoing training as a matter of course.
Past interactions with the vendor
Has this vendor worked with your company before on a project? Be sure there are no historical performance difficulties (integration, staff interaction, etc.) that disqualify a potential vendor you are considering by conducting some research.
Obviously ERP is an advanced technology with many different potential modules you’ll want to utilize. Make sure that upfront and ongoing training comes standard from your list of potential ERP vendors.
Previous Experience With Vendor
Has your organization engaged with this vendor for a previous project? Do some due diligence on this to make sure there weren’t past performance issues (integration, staff interfacing, etc.) that rule out a possible vendor you are considering.