Selecting an integrated software package (ERP) represents an important strategic, financial and technological decision for any organization. Choosing the right ERP solution can provide a business with a significant competitive advantage. A bad choice can, in turn, have disastrous consequences and lead to bankruptcy. How to choose an integrated software package (ERP)? Here are the main factors to consider.

What aspects should be considered when choosing an ERP integrated software package?

Today, the market offers adapted solutions to improve the competitiveness and performance of businesses.

There are 3 main factors to consider when selecting an integrated software package (ERP).

1 — The organization's strategy

By its nature, an ERP is an important lever for achieving a company's strategic goals. This is why it must meet its present and future needs as well. It is therefore essential to have a well-defined business strategy before even undertaking the selection process.

The choice of software package must take into account each of the factors constituting the strategic vision. Otherwise, the solution is highly likely to prove unable to support medium and long-term operations.

2 — How to choose an integrated software package (ERP)? Consider the financial impact

The acquisition of an ERP should be considered as an investment and not as an expense. It is therefore important to carry out a cost-benefit analysis in connection with the selected ERP solution.

Tangible costs:

Since the advent of cloud solutions, it can be difficult to assess the cost of an ERP. Cloud solutions offer very different cost models than traditional solutions (On-Premise).

The best approach is to assess what is called the “Cost of Ownership”. The exercise proposes to estimate costs over a period of approximately 5 years. The main amounts to consider are licenses (purchase or rental), implementation, support (external and internal), infrastructure costs (acquisitions and support), design, training (users and technical team), updates, and financial expenses.

Tangible benefits:

Often overlooked, tangible benefits can have a significant impact on the choice of solution, especially when they are more important than the tangible costs. We are talking here about a reduction in administrative and operational costs. It is essential to carry out an evaluation of tangible benefits over the same period of time as the corresponding costs (5 years).

The intangibles:

Although difficult to quantify, intangible elements are often a decisive criterion in the final choice of the integrated software package. Without going overboard, intangibles are very varied and require a higher level of creativity than tangible factors. Examples of intangible elements could be: employee satisfaction, reduced production cycles, improved product quality, inventory reduction, and customer satisfaction.

3 — Embedded software technology

An ERP solution that is based on reliable, robust, recognized and widespread software and hardware technologies makes it possible to obtain support (from a pool of available resources) at a reasonable cost. An integrated software package also makes it possible to monitor technological developments in the medium and long term. In addition, it facilitates the connectivity of the ERP to other systems internal and external to the organization and ensures uninterrupted availability of the system.

So, do you know how to choose an integrated software package (ERP)? Remember that you must take into account your strategy, financial impact and technology. That way, it's easier to choose the right ERP solution that's right for your business. Assessing real needs can be a complex exercise when you don't know what ERP offerings are available. Independent consulting firms like PlanAxion help you make an informed choice. Moreover, when deciding to implement an ERP solution in a company, you should not neglect its regular updates and maintenance. Stéphane Lamy-Bouchard has written a full article on the subject.