Purchase of ERP software is an elaborate process involving many steps. Companies which do not want to develop an in house ERP system go in for purchase of ERP software. The following steps lead to the eventual purchase of ERP software.
Preparation of in house document listing all the requirements and business processes and all the reports required for the organization. This document has to be prepared by an expert group responsible for listing all the requirements and not missing out on any. Steps for ERP purchase are:
Calling for quotes and product literature and discussion regarding agreements from various vendors.
Short listing the vendors based on agreements and product literature. Calling for a demonstration.
Recording of notes and comments by the evaluation group during demonstration.
Evaluation and comparison of all the vendors who have given a demonstration.
Selection of the vendor
When evaluating the vendors, the following aspects have to be focused on:
- Features and Function
- Service and Support
Of the above, the first three aspects are to be considered by the expert groups while evaluating the vendors. Features and functions refer to the features of the ERP software product in consideration.
It is recommended that companies create requirement lists with clear statements such as "The ERP software should accept and record including the date of the sales invoice, the name of customer to whom sale is being done, the material which is being sold, quantity of material being sold".
Later these statements have to be verified with the design document.
The cost quote of the ERP software has to be carefully analyzed as it may include hidden costs and may exclude important aspects of the cost.
The Service and Support agreement terms have to be carefully studied as all softwares required some sort of maintenance. A tested product will have lesser bugs and maintenance issues.
Changes in business processes of a company is a given in today's world this is because companies need to constantly innovate to stay competitive. So, companies need to factor this issue while selecting a vendor. Companies should note that vendors need to continuously upgrade their products to retain their customer base.
The software industry is a constantly changing and evolving industry. Companies have to ensure that the technology used to develop the ERP software is current and can be upgraded. Getting burdened with obsolete technology should be avoided by the company. To avoid obsolete technology, companies have to ask the vendors to submit a written brief of all the technology tools used to develop the ERP software and take a decision based on information given by the vendor.
Vendor sustainability in the market
Companies have to make a sustainability assessment of the vendors the constitution of the vendor company, the experience and background of the top executives, their office locations, customer feedback if any has to be considered while making an assessment.