Decision anxiety when selecting a new ERP system

Making decision when selecting a new ERP system often proves more difficult than the customer could foresee. Not because it is difficult to find a system that meets the specified needs, but because the decision should be based on an overall assessment of many and different criteria. And where the customer finds it difficult to evaluate the significance of these criteria against each other.

For example, how important is the license price compared to meeting the functional requirements? How important is it that the system covers all business processes compared to it being a young system built on a modern platform? How do you evaluate the importance of the vendors’s consulting capacity against the availability or lack of alternative implementation partners? How do you value an open and flexible system that requires more installation time compared to a more limited system with a relatively short installation? And how do you evaluate the need for or the risk of an open and flexible system to a customer with a very low understanding of process work and IT systems? And how do you evaluate a system presentation that was performed badly with another system presentation that went well but where the functionality is limited?

A number of questions often arise that create confusion and anxiety for the customer if no structure has been created in the prepared questions and the selection process. Nor has the transition to a cloud-based world simplified the choice for the customer.

The above are questions and issues we quite often encounter with customers who have contacted us for advice and support during the selection process. However, it is difficult to begin to steer the decision-making process and restructure the issues in the final stages of selection process. The usual result is often that there are a number of perspectives that have not been taken into account early in the selection and that become difficult to catch up with at the end of the selection. And redoing the selection is rarely an option. The reason for the situation that has arisen is usually because the customer has put 100% of his focus on the functional requirements and not taken into account other criteria that are at least as important in the choice of both system and vendor.

The list of appropriate decision criteria can be made long, but it can also vary from situation to situation. Some of the most common criteria are:

• The system’s functional width and depth in its standard design and setup
• System openness / flexibility in architecture and APIs
• Access to packaged additional functions / modules or Apps
• The price structure for licenses / user rights in both short- and long term
• Capacity and competence of the vendor both short-term and long-term
• The vendor’s ability for a high speed of development of the system (not least technically)
• Complexity and scope of the installation (ie what can the customer do by himself?)
• The possibilities for a gradual implementation instead of a Big Bang
• Availability of consulting support and partners nationally and internationally

 

Perhaps the most important criterion is which system has the greatest opportunity to realize the improvements and benefits that underlie the investment, and what will carry the customer into the future. And this very point is often given the least attention. For the simple reason that few customers have created an image of how they expect to be developed with a new ERP system.

The questions easily become many and it can be difficult to weigh one against the other. However, there is help and support available in the market. The most important thing, however, is that the customer tries to gain insight into the change that may occur as a result of the new system, and the opportunities it provides in a longer perspective. It will then be a little easier to weigh the cost of the investment against the value that can be created for the business. Comparing two systems and reasoning around cheap and expensive is seldom the right way to make a decision.