Ready to Buy ERP? Research Vendors to Save Your Company a Headache

A company’s decision to upgrade or convert its business software to an enterprise resource planning (ERP) solution is an investment that should be considered carefully. The selection of an appropriate ERP vendor should be based on the needs of the organization, not the vendor’s reputation or marketing skills. Research of various ERP vendors is easily accomplished with the help of comparison websites and online tools.

Those online resources enable an organization to eliminate solutions that are too expensive, complex, or that do not meet its basic needs. Another important decision when selecting an ERP solution is the choice between systems that offer on-site or have hosted network systems. Consider the following key aspects of ERP solutions when selecting the best product for your company.

Eliminate Solutions That Are Too Expensive

ERP vendors offer different levels of software based on price and functionality. More sophisticated platforms include upgraded functionality and powerful business management tools. While those robust programs are powerful and efficient, the initial investment required may not be within your company’s budget. Selecting an ERP vendor that fits comfortably within your budget and still meets the company’s specific requirements is crucial to ensuring a positive return on investment (ROI). An ideal ERP program is able to perform any and all required tasks, both current and foreseeable, without placing undue financial stress on the company.

Eliminate Solutions That Are Too Complex

An ERP solution that is too complex will never deliver the productivity gains and efficiencies on which its cost justification was based. A user interface that is cluttered with complex tools and a wide variety of extra features may get in the way of more basic functions. If transactions require more steps in the software than in your business process, productivity decreases. Training individuals on a new ERP system is costly in terms of time and money, and the more sophisticated the program, the steeper the learning curve for new users. Choosing a program that meets expectations without oversaturating the interface with unnecessary tasks will narrow the list of possible ERP vendors.

Determine Whether You Want Hosted or On-Premises Solution

The choice between on-premises and hosted ERP solutions is crucial when comparing ERP vendors. Many companies have security and performance issues that mandate an on-premises implementation. Other companies cannot justify that expense when compared to the low costs of hosted solutions. The choice of an on-site or hosted solution should be based on the company’s needs.

On-premises solutions also enable more customization. While on-premises solutions incur greater up-front costs than hosted solutions, those costs even out as license costs are amortized over time and eventually turn in favor of the on-premises solution. Because companies usually convert to ERP as a long-term solution, if your company can afford the initial costs of an on-premises solution, it will recoup those costs and have a better overall return on investment compared to the hosted solutions.