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Don’t Purchase an ERP System Without Consulting These Leaders

By August 31, 2020 No Comments

It can at times be hard to decide who at a company should own selecting and implementing new ERP system. 

Technically, it should fall under the purview of IT. After all, software is a type of information technology. But new technology won’t be effective if it doesn’t align with the company strategy. The truth is decisions concerning business software in general and ERP systems in particular shouldn’t be siloed.

Who should be involved, then? It depends on the size and structure of your company.

Whose Job Is It, Anyway?

Before you begin creating a software purchasing process for your company, you should first think about its chain of command.

If you work for a larger company with a number of departments, you should first work to convene a meeting with the department heads to get a better understanding of the challenges their direct reports face. Once you find areas of overlap, you and one of your IT leaders can begin searching for software solutions on the market based on your company-wide pain points.

For smaller companies, the process is a bit more simple. You should, of course, consult with the general manager to see if your company can afford new software. Beyond that, you should consider where your company currently is and where you hope for it to one day be as you decide what processes can be automated. 

In any case, you’ll need your company’s top leaders in the room before coming to a decision. Here are few of the individuals who should have the final sign off before your company starts the search and purchasing processes.

  1. Procurement/Purchasing Leader

ERPs can be a major investment on the part of a company. You need to shop wisely.

A leader from your company’s procurement department needs to be a part of the buying processing. They and their team are better equipped than anyone else in the business to compare prices and features, and from there make a recommendation based on the predetermined needs of your company.

In particular, procurement leaders should have procedures in place for a competitive bidding process in which different software providers have the opportunity to present the case that their software best fits the needs of your company. Members of the procurement department can compare prices and features offered by the different providers and rank them based on their alignment with your company’s needs.

The price of the software on its own, however, should not be the only consideration of your procurement department. They should also attempt to estimate future cost savings and revenue resulting from the implementation of the new software and determine whether the long term profits generated by the new software will outweigh the upfront costs. 

  1. CIO/IT Manager

It’s never a bad idea to rely on expertise.

Your company’s IT leaders are better positioned than anyone to judge potential business software systems on their merits. Top IT leaders possess a deep understanding of the company’s guiding strategy and how the company’s various systems support this strategy.

But perhaps more importantly, your company’s IT leaders are well acquainted with the current landscape in business technology. They know what technology their competitors are using and the distinct capabilities it offers them. And they know what direction the field is headed in and hope the company can capitalize on it. 

Overall, your company’s IT leaders should serve as a bridge between your company’s business and technology side, with the ability to present business leaders with the business case for the adoption of new business technology and other IT employees the technological case for it. 

  1. CEO 

Your company’s CEO is its chief decision maker. Make sure they’re in the room when a major technological decision is made. 

Obviously, a CEO’s time is valuable, and they may want to delegate the task of selecting an ERP system to their subordinates. But this would be a mistake. A company’s chief executive is the only person in an organization with a high level view of how each piece of the company works in conjunction with the others. The goal of ERP systems is, of course, to increase coordination between a company’s various entities.

If, however, you’re having difficulty accessing your company’s CEO, there’s a compelling business case to be made for implementing a new ERP system, including better organization-wide decision making, increased cash flow related to new efficiencies created by the system and improved customer satisfaction related to better cross-departmental communication. 

When it’s time to research new business software systems, Timac Business Systems is here to help. As a licensed dealer of Sage ERP systems, we have a great deal of experience in helping companies of all sizes identify software solutions tailored to their specific needs.

Contact us today to schedule a demonstration led by one of our product experts. We guarantee transparent pricing and a ERP solution with your company’s rich culture and strategy in mind. 

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