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ERP Selection Issues

It’s critical for companies to figure out if their ways of doing business will fit within a standard ERP package before the checks are signed and the implementation begins. The most common reason that companies walk away from multimillion-dollar ERP projects is that they discover the software does not support one of their important business processes. At that point there are two things they can do: They can change the business process to accommodate the software, which will mean deep changes in long-established ways of doing business (that often provide competitive advantage) and shake up important people’s roles and responsibilities (something that few companies have the stomach for). Or they can modify the software to fit the process, which will slow done the project, introduce dangerous bugs into the system and make upgrading the software to the ERP vendor’s next release excruciatingly different because the customizations will need to be torn apart and rewritten to fit with the new version.

Needless to say, the move to ERP is a project of breathtaking scope, and the price tags on the front end are enough to make the most placid CFO a little twitchy. In addition to budgeting for software costs, financial executives should plan to write checks to cover consulting, process rework, interrelation testing and a long laundry list of other expenses before the benefits of ERP start to manifest themselves. Underestimating the price of teaching user their new job processes can lead to a rude shock down the line, and so can failure to consider data warehouse integration requirements and the cost of extra software to duplicate the old report formats. A few oversights in the budgeting and planning stage can send ERP costs spiraling out of control faster than oversights in planning almost any other information system undertaking. The following points should be kept in mid while selecting the best package.

1.    It is the most critical phase of implementation as the package finally selected brings out success or failure of the project.

2.    The package is very costly, hence while selecting itself, one should be cautions before investment. The package cannot be changed.

3.    None of the packages are perfect. It would not be possible to buy a perfect package which fits ideally every business process you intend to cover. The most ideal one is to have a package which is more flexible to meet the company’s needs.

4.    Develop a selection criterion to evaluate all available packages to the same scale.

5.    While evaluating EP software packages, important pints to be consider as per the guidelines of the experts. These guidelines are as follows:

(a)    Match of company’s business process with the package functional fit
(b)    Flexibility, scalability, and complexity characteristics have to check.
(c)    User friendliness, fast implementation criterions has to look in.
(d)    Capability to support multisided planning and control.
(e)    Degree of integration between the components of the system
(f)    Technology, client/server capabilities,
(g)    Database independence, security
(h)    Possibility of frequent upgrades, availability of reference sites.

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