{"id":9051,"date":"2015-11-10T10:24:51","date_gmt":"2015-11-10T10:24:51","guid":{"rendered":"https:\/\/sg.syspro.com\/blog\/what-is-the-best-starting-point-of-an-erp-selection\/"},"modified":"2021-03-04T14:48:59","modified_gmt":"2021-03-04T14:48:59","slug":"what-is-the-best-starting-point-of-an-erp-selection","status":"publish","type":"post","link":"https:\/\/sg.syspro.com\/blog\/planning-for-erp-or-purchasing-erp\/what-is-the-best-starting-point-of-an-erp-selection\/","title":{"rendered":"What is the Best Starting Point of an ERP Selection?"},"content":{"rendered":"<p>For whatever reason, your organization has decided it needs a new ERP system.\u00a0 Your job is to find the best.\u00a0 But where do you start?<\/p>\n<p>Bing or Google will get you started.\u00a0 A quick search will immediately narrow your options to not less than 5000+ best ERP systems for you, all of which claim to do everything you want.\u00a0 This is good news because you now only need to write a list of requirements, send it to any of\u00a0the 5000, and choose the least expensive.<!--more--><\/p>\n<p>It\u2019s simple \u2013 you start with a Requirements Specification.\u00a0 Management Consultants will help you create one, or you can get help from any of several hundred automatic downloadable requirements generators\u00a0on the Internet.<\/p>\n<p>The approach should work, but it doesn\u2019t.<\/p>\n<p>Organizations have known about the pitfalls of ERP implementations for decades \u2013 yet implementations are still going badly wrong.<\/p>\n<p>Statistics vary, but the averages are still alarming:<\/p>\n<ul>\n<li>25% or so of all attempted ERP implementations are abandoned or fail.<\/li>\n<li>Of the remaining 75% \u2026 60 to 70% have challenges\u00a0in at least one of three ways:<\/li>\n<li>They are over budget and\/or<\/li>\n<li>They are late and\/or<\/li>\n<li>They are implemented with reduced functionality.<\/li>\n<li>30 to 40% are considered successful <em>(only 22.5% to 30% of the overall total)*<\/em>.<\/li>\n<\/ul>\n<p>These statistics refer to a period that coincides with the rapid improvement of ERP software. It has become functionally richer, better integrated, easier to configure or customize, and is easier to use.<\/p>\n<p><strong>This makes no sense.<\/strong><\/p>\n<p>If a company\u2019s requirements are better defined and understood than previously, and they are matched to better and more adaptable software, why is the end result the same?<\/p>\n<p>Maybe the answer is to take a step back and start somewhere different.<\/p>\n<p><strong>Resistance to change<\/strong><\/p>\n<p>A common theme in many failed or challenged implementations is user resistance to change. \u00a0This is all a bit odd to me.\u00a0 If true, it means\u00a0that every year a collection of key\u00a0employees in thousands of companies around the world suddenly decide to deliberately resist the wishes of their employer and sabotage their new ERP system.\u00a0 The solution is to employ an army of Change Management consultants, or so I\u2019m told.<\/p>\n<p><strong>Is user resistance a cause or just a symptom of a deeper problem?<\/strong><\/p>\n<p>The argument that I put forward is that ERP failure is not a people problem, or a lack of requirements definition, nor is it caused by bad attitude on the part of the ERP supplier.<\/p>\n<p>The problem, in my view, is that companies fail to ask or answer the question: \u201cwhat kind of company are we?\u201d<\/p>\n<p>Unless this is properly understood it is easy to choose an ERP package that is a poor fit to the culture of the organization.\u00a0 Fit-to-culture and fit-to-requirements are completely different and could be the reason for\u00a0resistance.<\/p>\n<p><strong>Harmonized or Dynamic<\/strong><\/p>\n<p>Broadly speaking, there are two types of companies, Harmonized and Dynamic.\u00a0 They cannot be defined by size (turnover, number of employees, local or international), but careful\u00a0study of\u00a0how they operate and\/or behave internally will identify their type.\u00a0 Culturally, these types of companies are radically different.<\/p>\n<p>A Harmonized\u00a0Company\u00a0is a company that presents itself as a single entity.\u00a0 No matter how diverse or widespread are its businesses, it will look to standardize its processes across all business units and geographies. Most importantly, customers will trade seamlessly with any part of the company.<\/p>\n<p>A Common Business Model should be created at the beginning of a harmonized implementation. \u00a0This model is rolled out into the different operating companies, business units, and geographies. \u00a0Localization\u00a0is\u00a0usually restricted to fiscal compliance and language.<\/p>\n<p>The ERP solution for a harmonized company\u00a0has\u00a0to deliver against this cultural background.<\/p>\n<p>A Dynamic Company\u00a0is the cultural opposite. Each business unit, even within the same geography, is often an autonomous unit with its own unit-specific processes and measures.\u00a0Customers engage with, and buy from, the local business unit.\u00a0 Standardization across the organization\u00a0is rarely\u00a0a high priority.<\/p>\n<p>The ERP solution for a Dynamic Enterprise has\u00a0to deliver against this cultural background. \u00a0A one-size-fits-all approach will not work because multiple business models,\u00a0configurations, and customization are needed. Rather than complicating matters by building multiple business models within a single instance, it is often easier and more acceptable to recognize the differences and build separate databases to support each model.<\/p>\n<p>Two types of ERP solution have just been described and it is highly unlikely that a single ERP system will be able to handle both situations.\u00a0 The ERP selection process should therefore start with a clear answer to \u201cwhat kind of company are we?\u201d followed by requirements that are consistent with the answer at all times.<\/p>\n","protected":false},"excerpt":{"rendered":"<p><span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Reading Time: <\/span> <span class=\"rt-time\"> 4<\/span> <span class=\"rt-label rt-postfix\">minutes<\/span><\/span>For whatever reason, your organization has decided it needs a new ERP system.\u00a0 Your job is to find the best.\u00a0 But where do you start? Bing or Google will get you started.\u00a0 A quick search will immediately narrow your options to not less than 5000+ best ERP systems for you, all of which claim to &#8230; <a title=\"What is the Best Starting Point of an ERP Selection?\" class=\"read-more\" href=\"https:\/\/sg.syspro.com\/blog\/planning-for-erp-or-purchasing-erp\/what-is-the-best-starting-point-of-an-erp-selection\/\" aria-label=\"Read more about What is the Best Starting Point of an ERP Selection?\">Read more<\/a><\/p>\n","protected":false},"author":158,"featured_media":9673,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[272],"tags":[88],"class_list":["post-9051","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-planning-for-erp-or-purchasing-erp","tag-selecting-erp"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - 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Waller","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/sg.syspro.com\/blog\/wp-content\/uploads\/2021\/03\/david_waller_blog_image-1-150x150-1-150x150.jpg","url":"https:\/\/sg.syspro.com\/blog\/wp-content\/uploads\/2021\/03\/david_waller_blog_image-1-150x150-1-150x150.jpg","contentUrl":"https:\/\/sg.syspro.com\/blog\/wp-content\/uploads\/2021\/03\/david_waller_blog_image-1-150x150-1-150x150.jpg","caption":"David Waller"},"description":"Dave Waller joined the ERP industry in 1973. Since then, he has designed, specified, sold and managed simple and complex ERP systems and enhancements in the UK, Europe and the US. Today, he works in Manchester, England for K3 Syspro. His approach when selling or consulting is to carry out an in-depth business requirements analysis to ensure that the selected solution meets the immediate and long term goals of the organization. David is also a NATO registered consultant and is US Military vetted.","url":"https:\/\/sg.syspro.com\/blog\/author\/david\/"}]}},"metadata":{"_yoast_wpseo_focuskw":["What is the Best Starting Point of an ERP Selection?"],"_yoast_wpseo_focuskw_text_input":["What is the Best Starting Point of an ERP Selection?"],"_yoast_wpseo_title":["What is the Best Starting Point of an ERP Selection?"],"_yoast_wpseo_metadesc":["The best starting point of an ERP selection: Identifying the culture of your organization is the first step to implementing a successful ERP solution"],"_yoast_wpseo_content_score":["30"],"_yoast_wpseo_primary_category":[""],"_yoast_wpseo_linkdex":["62"],"_yoast_wpseo_metakeywords":[""],"_yoast_wpseo_is_cornerstone":[""],"_wp_page_template":["default"],"_thumbnail_id":["9673"],"_elementor_page_assets":["a:0:{}"]},"_links":{"self":[{"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/posts\/9051","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/users\/158"}],"replies":[{"embeddable":true,"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/comments?post=9051"}],"version-history":[{"count":0,"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/posts\/9051\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/media\/9673"}],"wp:attachment":[{"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/media?parent=9051"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/categories?post=9051"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sg.syspro.com\/blog\/wp-json\/wp\/v2\/tags?post=9051"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}