Evaluation and selection of ERP package is an essential criterion for successful ERP implementation. Quality of selection will have a long term impact on the processes of the organization. It is also not easy to switch to another product with concomitant scale of investment and complexities. This evaluation and selection process should be properly directed and normally comprises of following activities:
Formation of an evaluation committee: An ERP implementation is not an IT project but a business oriented development. Therefore, in addition to Chief Information Officer, this committee should comprise of all functional heads and driven by a top management representative. Since all business functions are represented in selection process, the chosen package would have wide acceptance subsequently.
Requirement Analysis: This analysis should outline functional expectations of various business divisions, such as warehouse, finance, procurement, from potential ERP package. Vital requirements specific to the company should be highlighted e.g.
Requirement analysis forms a base for preparing a Request for Proposal (RFP), where important technical and commercial perquisites are incorporated. Common examples of technical perquisites: flexibility, Upgradability, User friendliness, field level security, Operating system and database compatibility. Common examples of commercial perquisites: cost, reference sites, high level project plan, resumes of consultants, post implementation support, financial health of the company, local presence, number of installation and upgrade.
Selection Criteria: A pre-determined selection Criteria should be ready before actual selection process commences. Selection criteria are normally in the form of questionnaire and point system, where each question represents a business or technical need. Weightage for each point or a group of points are predetermined which varies according to criticality of the issue. These processes help in making the selection process objective and transparent.
Selection Process: Selection process constitutes various stages as mentioned below:
The most important point of selection process is that it should be based on a consensus and have maximum buy in as an ERP system belongs to all functions and departments. Another important issue is that over expression of requirement during requirement planning should be avoided as this will lead to incurring unnecessary expenditure.
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