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ERP Vendor Selection Process Template: Step 1.) Understand Requirements and Deficiencies

ERP Selection Process

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SUDHIR WAGHULE
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77 views

ERP Vendor Selection Process Template: Step 1.) Understand Requirements and Deficiencies

ERP Selection Process

Uploaded by

SUDHIR WAGHULE
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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ERP Vendor Selection Process Template

Selecting an ERP vendor is a critical first step in implementing software that can
dynamically change and influence the future of your business. Unfortunately, many
businesses apply practices to their ERP vendor selection process resulting in;
unclear intentions, confusion, lost time, and undefined goals and system criteria. To
ensure that project goals are effectively met, the selection plan should be diligently
defined and based in best practices.

When entering this process it’s important to realize this is the first step. Dedicating
proper time and energy in this initial stage will ensure that nothing slips through
the cracks, and mitigates future project risk as things move forward.

This process doesn’t have to be difficult. At Datix, we’ve seen hundreds of


businesses navigate this process. Those that apply industry best practices to their
selection process are more successful. Below you will find a step-by-step template
that outlines these best practices in a simple, easy-to-follow road map.

Step 1.) Understand Requirements and Deficiencies

Work with executives and stakeholders to understand, validate and define key business
processes and system requirements. The documentation and clarification of these requirements
will help define how the system will be used, who will be using it, and what the system will need
to be able to ultimately accomplish. These processes and requirements should be used to
determine key evaluation criteria to measure potential an ERP vendors’ ability to meet the
needs of your business.

Sample evaluation questions may include:

 Who will be using the system?_______________________________________________________________

 What departments will use it?_______________________________________________________________

 What are the tactical goals of the system?__________________________________________________

Step 2.) Explore The Marketplace To Evaluate Potential Systems


This can be conducted through multiple channels. Often, searching web resources and
conducting initial due diligence can provide general direction. The most important thing to
consider in this process is the fit of potential vendors relative to the requirements established
and defined in Step 1. In fact, Step 1 should help save time and energy in this consequent vendor
search.

Copyright Datix Inc. 2015. All rights reserved


The purpose of this secondary assessment is to evaluate the potential strengths, weaknesses,
capabilities, and costs associated with potential solutions available on the marketplace.

Examples of search activities checklist:

 Initial internet search with requirement considerations ___


 Touch base with consultants that specialize in these areas ___
 Read reviews of businesses that have implemented similar software ___

Step 3.) Contact Qualified Vendors To Perform Demos


Evaluate the vendors from your search that best fit the functional and technical requirements
from Step 1. Take into account things like; technical needs, overall publisher viability (what’s the
long-term future of the software?), industry standing, and reputation. Consider any 3rd party
data available or lean on any suggestions that you may have received from a consultant or
partner. Contact these vendors and setup initial general system demonstration. Your vendor
contact list should not exceed more than 5-7 vendors (if your list is longer, consider spending
more time in Step 2).

If your requirements are well defined you can offer suggestions around important system
elements that you would like to see demonstrated.

Examples of considerations for stability, needs, and reputation checklist:

 Company, product stability_________________________________________________________________


 Potential of acquisition or major software innovations__________________________________
 How well does vendor match technical and functional requirements? (1-10)__________
 Were the reviews of this software generally positive? (1-10) ____________________________

Step 4.) Narrow Selection


After the demos are completed. Immediately eliminate any initial losers. Then, match what each
vendor provides against your initial functional and technical requirement list. Eliminate any
vendors that clearly do not match as well as others. Your list should be narrowed to no more
than 2-3 vendors.

Examples of fit questions

 How well does vendor fit technical aspects of desired system?_____________________________


 How well does vendor match functional aspects of desired system? _______________________
 How did you feel about system interface and usability? _____________________________________
 Were there any personal preferences by the selection team?________________________________
o What were they?________________________________________________________________________
 Are there other quantifiable benefits of any particular system?_____________________________
 How well does functionality match-up with initial cost research and project budget?

Copyright Datix Inc. 2015. All rights reserved


Step 5.) Script Final Selection Demos
After finalizing your list of final vendors, deliver your list of technical and functional
requirements along with ultimate system goals to those that were selected. Provide a script of
modules, software, functions, and tasks that you would like to see in a final demo. By providing a
uniform demo to all, your organization can scorecard how well each vendor performs in each of
the important areas.

Prior to these final demonstrations, we suggest inviting the vendors for a visit to conduct a
practice discovery meeting. This gives them a chance to gather sample data, ask questions, and
meet the team in charge of the project. This will help them best align their offering to your
organization allowing your business the best picture as to what the system will actually look
like.

Example of items to deliver to final vendors checklist:

 List of functional requirements___


 List of technical requirements___
 Script for final demo___
 Sample data that can be used in the demo___
 Invitation to conduct practice discovery meeting___

Step 6.) Conduct and Scorecard Final Demos


Conduct the scripted demo’s with the selected vendor’s. Equip each member of your evaluation
team with a custom designed scorecard that considers aspects of the functional and technical
requirements that are most vital to the system. The scoring method doesn’t need to be complex,
but should require some intelligent thought regarding how different requirements are weighted.

Scorecard Considerations:

 What requirements are most important to score?


 How should different aspects of the system be scored?
 Take into account flexibility.
o How much did the system change after discovery, script, and sample data were
added?

Step 7.) Execute Final Elimination Process


Collect final quotes and proposals from the remaining vendors. Then, tally the scores of each
vendor from final demos. Realize that not all comparisons are apples to apples, and have an
organic conversation around how systems that are different may stack up against each other
during practical application.

Take in to account all the external factors that are not included in the scorecarding process.
Check the references that each vendor has provided and take those results in to consideration as
well. Consider the people that will support your project and how well they mesh with your
project team.

Copyright Datix Inc. 2015. All rights reserved


Example checklist for final selection process:

 Collect final proposals___


 Tally scorecards ___
 Check references ___
 Consider vendor team (people) ___

Step 8.) Elect a Winner


Ultimately, all the criteria should now be compared against inescapable truths like project
budget, how well the vendor meshes with company culture, and how the project team felt about
the vendor and the people that would be involved in implementation.

If your organization finds itself unable to decide. Revisit Step’s 1 and 2 to further define the
exact criteria needed to make this final decision. If it remains difficult, it is often considered a
good idea to consult with a partner that may be able to provide neutral input.

Final election criteria:

 How well did each score in step 7?___


 How does each mesh with project budget?___
 How well does the vendor and its people match your businesses culture? ___

For more information about ERP vendor selection; contact


[email protected]. Our experts have helped hundreds of
businesses find the right ERP solution for their businesses.

Copyright Datix Inc. 2015. All rights reserved

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