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ERP Evaluation Criteria and Functionality Checklist to Select the Best ERP Solution

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You are supposed to evaluate an ERP system for possible acquisition, believe me it can come to you and your selection committee/stakeholders – as a nightmare. Have you ever thought about the amount of research material and operational data you will need to take into consideration an ERP module that suits all your business needs?

At Hi-Tech ITO, we have successfully put together this practical list of ERP evaluation criteria, based on our profound experience and extensive research for ERP selection projects. ERP evaluation criteria and functionality checklist on this page will work to your advantage in getting off at the right foot to start prioritizing your specific requirements for an ERP purchase.

ERP Evaluation Crieteria

So let’s check out that comprehensive list of key ERP evaluation and functionality criteria, which can assure you of selecting the Best ERP solution that meets your business needs:

ERP Evaluation Criteria

You can succeed when your ERP software meets most of the following criteria, depending on your organizational needs:

  • Customer Relationship/Account Management

    Just check out whether the CRM module allows the users to view customers across a wide range of custom views that includes products, geography, account type and many more. If the CRM module is effective, it should also allow a convenient access to required ERP information across devices any time.

  • Accounts Payable Reporting

    Making collections more efficient and accounts aging easier to access is what a good ERP solution provides to your AP team through sufficient reporting.

  • Bank Reconciliation

    Your potential ERP solution should be well equipped with a bank reconciliation feature that helps your organization in reconciling bank statement balances with general ledger cash accounts amount.

  • Benefits Administration

    See if your ERP has a system to manage and track participation in several benefit programs such as insurance, compensation, profit sharing and retirement programs.

  • CRP – Capacity Requirements Planning

    You are an organization in need of a feature that can help you determine the resources required in meeting production requirements; CRP module becomes one of the mandatory aspects of your ERP solution.

  • MRP – Material Requirements Planning

    Production planning, scheduling, and inventory control system, if they are some of your requirements, check out thoroughly whether the ERP solution that you are evaluating includes this module.

  • BOM – Bill of Materials

    You also might need to use bills of materials while creating production orders in manufacturing different products. If it is so, then ensure to look out for this feature into whichever ERP solution you are considering to finalize.

  • Logistics Management

    Logistics management is one of the core features for any ERP solutions, in fact I will go to the extent of saying that an ERP does not qualify to be called so without logistics management as an integral feature. What do you say?

  • BI – Business Intelligence

    Business Intelligence feature in an ERP solution; how? I knew this would be your first reaction, as we have seen quite a lot business intelligence solutions – but as standalone products. However; trust me BI can be a part of your ERP solution. It is purely based on organizational priorities, if you would want to harness the BI tool/module in your ERP or would want to go ahead for a standalone, best in class BI tool.

  • Email Tools

    There are ample platforms in the market that offer Email tools. They also form an integral part of CRM solution, and hence; you are already might have one – if you have deployed a CRM. However; if your ERP is also your core CRM, as mentioned above, do not miss out on checking whether a robust email tool is a part of the product feature set.

  • B2C Commerce

    This again, I would say, is a point of organizational preference; as to would you want your ERP to act as your point of commerce or you would want to go for a standalone commerce platform.

  • Advanced Allocations

    Every organization is looking out for ways and means to improve overall efficiency and accuracy of financial reporting, making advanced allocations functionality a mandate for your ERP solution.

  • Tax Administration: Payroll & Tax Filing

    Tax administration technology is supposed to be a core part of your ERP solution that inherently saves time, money and efforts of your finance team, does the ERP you are considering has this feature?

  • ECM – Engineering Change Management

    Products and manufacturing process management, happens to be a fundamental and consistent challenge that organizations face. The ERP solution that you are seeking needs to have ECM with central logistic functions that can be utilized to mend several aspects of production’s basic data purely depending on specific conditions.

  • CCM – Customer Credit Management

    Does your ERP software report customer’s credit standing for any time and period, and also enables you to monitor ongoing sales activity for designated customers, as it is required to hold credit for evaluation of a sale. Check out for this feature as well.

  • ATP – Available To Promise

    ATP module gives you as a manufacturer, better visibility into completion across levels and the entire supply chain. This functionality, though optional for your organization, would prove really important in your ERP.

  • APS – Advanced Planning System

    What do you do in case you are required to track costs based on several activities that are responsible for driving costs in the production of manufactured good using APS? Apart from other features, it should be in a position to allocate raw materials and production capacity optimally to balance demand and plant capacity. Don’t ignore; look out for this capability in the ERP module you are considering.

  • Lean Manufacturing

    If you are one of those manufacturers, you are the one who would need these tools in build in your ERP solution, to support lean manufacturing and flow scheduling practices for production, replenishment and inventory.

  • BPM – Business Process Management

    The most vital to your ERP system and selection is the Business Process management module. It is so because this module will empower you with capabilities to automate all your business processes.

  • Flexible Network Design

    Generally critical and included element for any top ERP selection is the flexible network design as it increases the scalability and efficiencies to a supply chain module.

  • Module/API Integration

    You may go ahead to select any of the ERP package, at the end it needs integration between modules and optionally several third party platform APIs in order to swiftly connect all of your core business functions. This makes the information to flow across the organization which helps you with BI reports about organization wide results.

  • Installation Type

    There are chances that you might opt for either a SaaS or On-Premise ERP installation. Each of the option has its benefits and limitations, so it is highly advisable to first evaluate your organizational preferences- extensively. Most important part in the evaluation of any ERP solution that you are considering should include:

    • What are the Implementation Services available?
    • What is the Maintenance Contracts/On-site maintenance availability?
  • Support

    Take my word for this, any good ERP solution should include enlisted support channels:

    • Forum/Community Support
    • Phone & Email
    • Chat & Instant Message

    Apart from aforesaid, it also should include availability across time zones, looking at the criticality of their ERP solution to your organization to function at its best. This also should include extensive end-user training development tools, as well.

  • Vendor Credibility

    This also is one of the most crucial considerations, as you might end up deciding perfectly on all the aforesaid factors, but the vendor that you select without due diligence is the one with not many clients who are appreciative about his past performance, integration, staff interfacing, etc.

  • Financial Stability

    Also ensure you check out the financial stability/status with help of services like Dun & Bradstreet. You can go ahead to check out the funding history, even the recent funding, count of employees, and several such indicators. This will help you gain confidence about the selection of an ERP vendor, which you are considering is in good shape – fiscally.

So finally, it seems we have put across anything and everything that you should consider while selecting an ERP platform and an ERP vendor. We hope you found it really useful, however; if you feel we have missed out on something – please share it in the comments box below.

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Hitech ITO

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