Switching ERP software: Selection and implementation

Life becomes more difficult when your current ERP system isn’t cutting it anymore. Maybe it’s not keeping up with your company’s growth, it’s lacking key features, or it’s simply not as good as the competition.

The question is, once you’ve established that your business has outgrown its ERP system, what are the next steps? Who should you switch to? How easy will the crossover be? And what groundwork needs to be laid out beforehand?

Let’s start with the process of selection.

ERP Selection Phase

Assemble a team and identify the gaps in your business

It’s common in the early stages of switching ERP systems to rush into researching your options. And whilst this is an important step, it’s critical to establish what you want from the project before your search begins. With the input of senior management, your business needs to identify its shortfalls, challenges, and systems that are inefficient or costing you too much money. Having this information consolidated will prove invaluable when having those initial conversations with new providers.

Outline your budget and timescale

On top of identifying the shortfalls and challenges of your business, it’s imperative to identify the time and budget you can realistically allocate to the project. When working out your budget, it’s worth keeping in mind the costs outside purchasing the software itself. For example, will you need to purchase additional servers or equipment? And who will be responsible for the ongoing management of the ERP system?

When it comes to allocating time, it’s important you understand just how much you will be dedicating to the project. In addition to the time it takes to roll out a new system to staff, is factoring in the time to migrate data, perform tests, and execute any custom development. Of course, implementation time will vary widely on the size and complexity of your operation, but on average, it can take anywhere from six months to two years to fully integrate a new ERP system – especially at enterprise level

Begin the search – and take your time

Armed with your list of requirements, it’s time to start your search. If you aren’t sure where to begin, it’s worth sticking to your industry vertical. Most ERP systems are industry- or size-specific, so don’t waste time researching a solution that’s not made to fit the needs of your business type.

You can also check out our new comparison guide on the top 12 ERP systems.

Selecting ERP systems is a huge step for any business, so be methodical when it comes to evaluating and comparing different vendors. ERP implementation isn’t a short process, so putting in the effort with your research now and properly outlining your goals and expectations is critical. Rush things, and you risk joining the 50% of other businesses that experience failure with their first ERP implementation.

Shortlist your top providers and arrange demonstrations

Once you’ve had a thorough look around the market, read reviews and made your relevant enquiries, strip your search down to a shortlist of two or three providers.

Although uncommon, some businesses still go through the entire vendor selection process without seeing the system in action: The first-time their employees will get to see the system, is when it’s being rolled out. A better approach is to take your shortlisted providers and bring them in to perform a demo at the very beginning of the process. This means employees and management have time to provide feedback and any further questions.

Ensure the system integrates with other apps

Whilst many modern ERP systems will incorporate most of your day-to-day operations, your IT department will still be responsible for the smooth running of your full IT infrastructure. It’s down to you to find out what APIs are offered and how these will integrate with your critical applications.

ERP Implementation Phase

Of course, once your business has signed on the dotted line with your new provider, you can expect to be guided through the next steps in detail. However, for those curious to know the industry standard, you can expect the following:

Allocation of roles and resource

It if takes a village to raise a child, it takes a whole business to make for a successful ERP project. Critically, your business needs to assemble a cross-functional group that is available to take charge and front the migration. This will include a project lead and department leads.

Just like any project manager, the project lead (PL) of your ERP project will be the main point of contact between your business and your new provider. As well as liaising with senior management and department heads, the PL will be responsible for ensuring the backing needed to implement change across the business.

Your senior leadership team will act as a representative from each area of your business – be that sales, accounts, or customer service. It will be their responsibility to communicate the needs of their team as well as distributing any specific tasks.

Data cleansing

An ERP project is only ever as successful as the data it’s given. But success can be achieved through thorough data cleansing. Start by considering what data can be scrapped, and what needs to be made a priority. For example, will you delete items that you no longer manufacture? Or keep the data from a vendor you haven’t purchased from in years? There aren’t any strict rules, but it’s a conversation to have with senior management and your department leads.

The best practices for data cleansing?

Keep it manageable: Identify a few issues at a time, investigate, then engage with the right people. Repeat.

Prioritise by your business values: Focus on the data issues that have the greatest impact on your bottom line.

Distribute the tasks across your teams: Spread data clean-up tasks out across all the teams that touch your data.

User testing

When you reach the testing phase there is often pressure to get through the process as quickly as possible. And while some small problems may well be resolved in time, going live without 100% successful testing is a huge risk. The purpose of these tests must be communicated well in advance to everyone. There must be a contingency plan; that plan should include being honest about the reasons for postponing go-live. If software has not been sufficiently tested, then that must be communicated. If some user departments are not ready, that also must be communicated.

The key is to not panic when go-live testing brings up any problems. That is precisely what it is intended to do. Proper testing is a small price to pay when the system is intended to provide functionality for years.

Require further support switching ERP?

If you believe your business is operating below where it should be, it could be because your software solution is underperforming. For more information about the process of investing in ERP software, download a copy of our guide to investing in ERP software.