Are you thinking about acquiring, or perhaps updating, an Enterprise Resource Planning (ERP) software solution? It’s a great moment to be thinking about your options in this regard. ERP software helps you run your business. Solutions usually comprise multiple systems for managing human resources, finances production and assets. ERP is able to run on a range of platforms, including public cloud hosting services.

Which ERP solution is right for your business? Acumatica has published a useful checklist to help you evaluate different ERP packages on the market. The checklist suggests that you look at how well an ERP solution meets criteria across the following categories:

  • Productivity, or what the product can do to make your people work more productively, i.e. doing more tasks in less time.
  • Functionality, referring to the product’s features and functions as they relate to getting work done in your business on a daily basis
  • Technology, and how well the product leverages technology for integration, customization, usability and maintainability
  • Value, which deals with how well the product maximizes features versus cost
  • Risk, which encompasses how the product minimizes risk and facilitates security

Productivity as a selection factor in ERP solutions

There are many aspects of productivity to consider in a prospective ERP solution. For instance, does the solution offer true universal availability? This means having access to the ERP system from any device, anytime, anywhere. True universal availability enables productivity by facilitating staff working in the field, from remote locations, at home and so forth.

Multi-language and multi-currency capabilities also spur productivity. Your people can work in the language that best fits their situation. You can also communicate with your customers in their languages and currencies.

The importance of functionality in evaluating ERP

Examples of functionality that differentiates ERP solutions include the ability to operate multiple entities in the software. The checklist asks if the prospective ERP solution supports multi-company, multi-warehouse and international companies. This includes financial consolidations, intercompany eliminations and reconciliations.

Financial management functionality is critical to understand in depth before choosing an ERP solution. For instance, does the ERP software support standard accounting functions like General Ledger (GL), Accounts Payable (AP), Accounts Receivable (AR), cash management and tax management?

In terms of customer-facing functionality, does the solution offer “Quote-to-Cash”? That is, can you create quotes and convert them into sales orders? Then, are you able to move directly to checking inventory availability, performing a credit check, picking, shipping, invoicing and collection?

Understanding an ERP solution’s technology story

Regarding technology, the ERP checklist suggests looking at whether a cloud-based ERP solution is “true cloud” in nature, i.e. is all functionality accessible through via a standard browser without any need for software installed on the user’s device. Responsive design is also a consideration, given how users now expect to use ERP on a variety of device types.

Seeing the value of an ERP solution

ERP takes budget. That’s a given. However, lower Total Cost of Ownership (TCO) is preferable if it does not come at the cost of functionality or usability. The ERP checklist asks you to review the TCO over a product’s lifetime, e.g. 3-5 years. The TCO includes licensing, hardware, support, hosting costs and so forth.

Another aspect of value is the prospective ERP solution ability to scale as you grow. The best ERP software packages will accommodate heavier volumes, more resources and more users as your business grows. Ideally, you’ll only pay for what you use, however. This might involve flexible licensing options.

Assessing ERP risk

ERP risks span everything from choosing an unproven supplier (and suffering the consequences) to security and compliance problems. It’s a wise move to probe deeply into a prospective ERP solution’s security features. Bear in mind, though, that these features may rely on how well they can implement your existing security policies and integrate with your other security tools.

A few basic parameter to check, however, are whether the ERP solution supports platform, web, and computer security—leveraging security expertise at hosting providers. It is important to ascertain how well the solution can protect your data. And, it’s essential to know how the solution handles backup and disaster recovery.

Click here to get the full checklist.

If you found this article helpful, you might also enjoy reading our whitepaper on “When is it the right time to replace your ERP system?”. Or learn more in ERP 101: What is ERP and How Does it Work?.