Selecting the right enterprise resource planning (ERP) system is essential to maintaining the core functions of your business. ERP systems are modular software solutions that make it easier for companies to manage, integrate, and optimize their transactions and functionalities.
Companies in every field rely on ERP software for key capabilities, from accounting to professional services automation. The most effective ERP ensures your investment is beneficial in the long run and optimized for your company's operations.
Step-by-Step Guide to the ERP Selection Process
Determining your business's needs and budget is the first step to understanding how to select an ERP system. Once you know these details, you can start analyzing your options and assessing which ones meet your requirements. It's also important to consider your company's growth and operations.
Follow these steps to make the right choice:
1. Determine Your Business Requirements and Budget
Establish the current processes and improvements you'd like to see from implementing new solutions. Take note of your business goals and the functionalities you need to improve to achieve relevant KPIs.
When choosing an ERP system, consider the upfront costs and other factors like ongoing services, upgrades, and implementation.
ERP is a core investment that will help streamline every essential process and can make it easier to improve focus areas.
2. Compare ERP Options
There are many top ERP systems, from Oracle NetSuite to SAP S/4HANA, and they all have different pros depending on your business needs.
Here is a quick breakdown of some of the best options available:
- Oracle NetSuite: In 2024, NetSuite was named a Leader by IDC MarketScape. This ERP is the ideal choice for many organizations and has a robust customer relationship management (CRM) module that helps maximize efficiency across your entire business. NetSuite provides real-time analytics and reporting, so companies can make informed decisions quickly and adapt to market changes. It can also help lower costs from inventory management and create consistent output across the board. See why companies like yours are making the switch to NetSuite!
- Microsoft Dynamics 365: This option offers a suite of ERP and CRM applications designed to unify sales, finance, and operations within the broader Microsoft ecosystem. While it integrates well with Microsoft tools, it has some shortcomings compared to NetSuite. Its modular structure can lead to complex deployments, higher customization costs, and challenges scaling efficiently as business needs grow.
- Acumatica: This cloud-based ERP platform is geared toward small and midsized businesses, offering modules for finance, distribution, and project management. While user-friendly, it often lacks the depth, scalability, and advanced automation larger or rapidly growing businesses need as their operations become more complex.
- SAP S/4HANA: This is SAP’s enterprise resource planning suite that runs on the HANA in-memory database, designed to centralize functions like finance, supply chain, and procurement. While powerful, its complexity, heavier infrastructure needs, and higher implementation costs can make it challenging for growing companies seeking flexibility and faster time-to-value.
3. Evaluate the Implementation Process and Duration
A vital part of the ERP selection process is defining your agenda for software implementation and identifying the process style that aligns with your business model. You’ll also need to find a partner that can provide ERP solutions on your preferred timeline.
Think about the time it would take to train employees on the new software and processes. When selecting an ERP system, consider how it will evolve to meet your current and future business needs — look for opportunities for added scalability.
For example, will it be easy to integrate it with existing systems? Track the system's efficiency from the go-live date by setting and measuring relevant KPIs.
What Are the Core Features to Look for in ERP Software?
ERP software selection plays a key role in the functional operations of your company's core and advanced processes. Finding an ideal fit is all about evaluating the system's capabilities to address your organization's critical issues or areas for improvement.
Play out potential future challenges. Determine if the ERP software will still be helpful or if it has the potential for customizations that can help. You should also consider whether your company requires a more configurable system or if a more rigid ERP will be a better fit.
These are a few core features to look for when selecting the best enterprise resource planning software:
- Automation
- Customization
- System integration
- Scalability
- Data security
- Risk management
- Tracking and visibility
How to Find the Right ERP Vendor for Your Business
Investing in an ERP is a significant decision, and it is necessary to choose a partner with industry-specific experience and the ability to work with your company's culture, vision, and timeline. When you form a partnership, you should feel confident that they can help your organization thrive by offering you the best-suited ERP systems and solutions.
Research shows that implementing ERP systems has a positive effect on firm performance by improving production processes and operational efficiency.
Here are the top questions to ask potential vendors as part of your ERP evaluation:
- Do you have case studies proving that you've worked with companies similar to ours?
- What is the availability and location of your customer service?
- What is the typical frequency of your software updates?
- What is the average tenure of your support staff?
- What are your training options?
- Do you have any upcoming features in the pipeline?
- Do you use an industry-oriented approach?
- Can you walk me through each step of your implementation process?
- How do you handle data migrations?
What Happens if You Choose the Wrong ERP?
If a business chooses the wrong ERP, it will face many short- and long-term challenges. The company may not be able to justify the costs of the ERP, mainly because the return on investment is unlikely to be sufficient. Here are some of the potential difficulties:
- Increased costs: This can lead to higher implementation and maintenance costs in the future. Overly complicated options also require more training.
- Decreased output: It can cause low efficiency and disrupt processes, ultimately affecting company production.
- Data integrity: The wrong ERP can pose data integrity issues, leading to regulatory compliance risks and a long-term impact on company growth and reputation.
Find the Best ERP for Your Business With GSI
At GSI, we can help you tick every box of your ERP evaluation criteria with our industry experience and proven results. There's no one-size-fits-all ERP system, but NetSuite suits companies in a variety of industries thanks to its unified data model, scalability, and integrations.
GSI is the #1-ranked NetSuite solution provider in G2 and a certified Oracle Platinum Partner.
When you partner with us, you can expect 24/7 global support, a team with decades of real-world experience, and the highest level of service day after day. We offer fully customizable solutions at competitive prices that help companies of all sizes thrive.
Contact us to learn more about our ERP solutions and how we can help your company achieve operational excellence.
