You’ve heard about the benefits of implementing an enterprise resource planning (ERP) solution, and you’re ready to reap them. You know that migrating the financial and operational aspects of your business onto a central, comprehensive platform can streamline your operations, improve communication, increase efficiency and reduce costs.

While the perks sound perfect, the reality is that an ERP implementation is a complex endeavor. Is your company prepared? To answer that question, you may need to conduct an ERP readiness assessment.

Today, we’re sharing a few of the key questions to ask and factors to consider as you weigh your next steps forward.

Benefits of ERP Software

Of course, the first consideration is whether or not your company could truly benefit from new ERP software and if those ERP business benefits outweigh the costs.

The 2020 ERP Report

This report summarizes our independent research into organizations' selection and implementation decisions and their project results.

There are many benefits of ERP software, so It’s easy to see why thousands of business leaders implement it.

One of the primary benefits is the ability to consolidate disparate parts of your business onto a single, automated platform. This means you’re no longer required to enter data into various different systems and spreadsheets.

Instead of spreading data among your customer relationship management (CRM) software, point of sale (POS) system and other applications, you have it all in one system, accessible anytime and anywhere. In turn, this helps reduce manual error, quicken your business cycles and improve customer satisfaction.

ERP software can also deliver other key benefits:

  • Improved productivity
  • Deeper visibility and traceability
  • Improved inter-departmental collaboration
  • Increased process efficiency
  • Easier cross-department collaboration
  • Streamlined processes across departments
  • Reduced administrative and operational costs
  • Increased mobility and flexibility
  • Quicker, more accurate customer service
  • More accurate forecasting and reporting
  • Stronger competitive advantage 

Seeing this list, it’s easy to jump in with both feet, but before you begin assembling your team, it’s important to first conduct an ERP readiness assessment.

What is an ERP Readiness Assessment?

In short, an ERP readiness assessment is the process of analyzing whether your company has the structure, resources and personnel in place to successfully support an ERP software implementation. 

Understanding fundamental business issues is a critical step to take before you begin researching ERP vendor options and negotiating ERP contracts

erp-readiness-checklist

8 Questions to Ask Before Beginning an ERP Project

  1. Have you defined the motives or pain points that are driving your organization to consider an ERP implementation?
  2. Are your business processes standardized? Do you have a key set of best practices or do you constantly reinvent the wheel?
  3. Do you have executive buy-in and adequate internal resources to support and roll out the project?
  4. Have you set project and business benchmarks to determine the success of your ERP project?
  5. Is your company culture set up to embrace a large-scale change initiative?
  6. Are your individual offices separate and siloed or part of a single, integrated company?
  7. Is your company currently undergoing or planning to undergo other major changes in the near future?
  8. Are you willing to measure and assess the ERP project process and work toward continual improvement?

Discussing and answering these questions can help you locate the gaps in your operations that an ERP system can help close. You’ll also learn how to approach the change management process to increase the profitability of your new investment.

Make sure to answer each question as openly and honestly as possible. The responses that you and your team provide can help you determine the level of risk you’re ready to take on, as well as any additional mitigation efforts you might need to take.

An ERP consulting firm can walk you through these questions, identifying key data points that can help you develop an accurate response. If it’s determined that now isn’t an ideal time to adopt your first ERP project, your ERP consultant can help you prepare and create a timeline for a future ERP rollout. 

Problems to Address Sooner Rather Than Later

If your answers to the questions above indicated that your company isn’t quite ready for ERP, we recommend you take the time to prepare your company.

“Wait, but I have pressing issues that need to be addressed with ERP software ASAP!”

It’s still important to take a step back and prepare your company.

If necessary, you may be able to fast-track some aspects of the preparation, but only under certain circumstances. Following are four signs that may indicate that you need to fast-track your ERP readiness. Otherwise, we recommend taking your time.

  1. Major inventory issues impacting order fulfillment
  2. Communication breakdowns between departments
  3. Abnormally long business cycles
  4. High number of manual data entry errors

Note that not every one of these symptoms is a sign that it’s time to implement ERP at your company. Sometimes, business process reengineering may do the trick.

We’ll Help You Conduct an ERP Readiness Assessment

Determining whether to invest in ERP software is a major decision. Rather than rushing into it, it’s best to ensure you have the resources, executive support and openness to change necessary to select and implement ERP as efficiently and cost-effectively as possible.

An ERP readiness assessment can help you determine if now is the right time to move forward, or if there are other steps you should take first. Request a free consultation below to find out if your company is ready for ERP.

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