Selecting an Enterprise Resource Planning (ERP) system for your business is a significant decision. Your ultimate hope is that the new ERP will result in noticeable business improvements. However, getting from evaluation to go live is a big undertaking. The process can be overwhelming leading to lack of focus. In this blog post, we discuss why overthinking the ERP evaluation is unnecessary, and how embracing the “80% rule” can speed things up to avoid getting lost in details.
The Quest for Perfection in ERP Evaluation
Don’t strive for perfection when choosing an ERP system. It's crucial to understand that there is no ideal system that will perfectly align with all your business needs “out of the box”. Over analyzing every feature and requirement can lead to decision paralysis, delaying the benefits a new system can potentially yield.
The 80% Rule: Finding a Balance
80% suggests that you should accept a new system if it meets the majority of your needs. By focusing on the majority of your requirements, you can avoid endless analysis, save time, and make progress towards implementation and go live. 80% is more of a qualitative than quantitative notion. Most contemporary ERP systems have significant functionality out of the box, or can easily be configured to achieve your needs. Don’t get into the minutia of all functions and features during the evaluation. You must however focus on vital requirements.
Identifying Vital Requirements
Vital requirements are the aspects of your business that a new ERP system MUST include. These directly impact your core operations, unique workflows, or compliance standards. Examples of this are lot traceability for FDA companies, and EDI for suppliers to big box retailers. By differentiating between vital (the few) and non-vital (the many), you can manage the evaluation process and come to a conclusion sooner where priorities have been weighed heavily.
Focus on Rightness of Fit – consider the implementation
During the ERP evaluation, it's important to consider the rightness of fit. This means evaluating how well a system aligns with your budget, business goals, processes, and future scalability. While an ERP may meet a significant portion of your requirements, it's equally crucial to assess how the implementation will go. Thoroughly vet your consultant and look at your internal personnel. Evaluating the rightness of fit goes beyond a mere checklist of features. A well selected ERP and consultant will help ensure a smooth integration and minimize potential disruption.
Timing of Training
During an ERP evaluation, don’t expect to get trained. Instead, focus on understanding the overall fit of the system and the consultant in your company. Full training will be addressed post selection. Digging too deep too early into ERP features and functions will sidetrack you and will waste time on unnecessary details.
Overthinking the ERP evaluation process can impede your ERP project. Instead, embrace the 80% rule, allowing you to strike a balance between practicality and thoroughness. Remember that perfection is unattainable, and the goal is to find an ERP system that meets most of your needs without compromising vital requirements. Consider the rightness of fit, evaluating how well the ERP aligns with your business goals and processes. And, remember the “who” of an ERP implementation is equally as important as the “what”.
Acuity Consulting Group is based in Providence Rhode Island. We help our clients implement business software solutions, specifically Enterprise Resource planning. We have been in business for 20 years and have deep connections to Rhode Island and southern New England.
Fun Fact to go with his blog: The first US Open golf tournament was held at Newport Country Club in Newport Rhode Island in 1895. One hundred years later Tiger Woods won the US Amateur at this same venue.