The best ERP for any business depends on your unique business and your organizational context.
Choosing the Best ERP for Small Business Applications
What is the best ERP for small business? The honest answer is that this is a bit of a trick question and the answer is the same whether you are a small, medium, or large enterprise. There really isn’t a universal best fit that will work equally well across the board for any and all enterprises. There is one best fit for each and every organization, but the organization owes it to themselves to find out what that one “best fit” is.
The best ERP for any business depends on your unique business and your organizational context. There are sound organizations that help categorize and rank ERP systems and vendors based on various criteria. But there also exist a vast array of selection criteria in which your organization may have unique or desired requirements.
The answer remains the same, the best ERP for small business is the one your organization selects after a thorough, objective, and methodical consideration and selection process.
Is there a One-size-fits-all ERP Solution?
ERP selection is a complex task for any organization, big or small. ERP systems are expensive, and the wrong choice can be disastrous. There are ERP selection guides and ERP comparison charts available to help organizations narrow down the field of ERP vendors and find the best ERP system for their specific needs. However, it is important to remember that there is no one-size-fits-all solution when it comes to ERP.
What works for one organization may not be the best fit for another. It is therefore essential that organizations take the time to thoroughly research their options and select an ERP system that will meet their specific needs and requirements.
There are many ERP solutions in the market today. Just for discrete manufacturing alone, there are nearly 100 vendors to choose from. But the fact remains, proper and diligent system selection is crucial. While we work with many great ERP products, vendors, and third-party resellers daily, they can be unique in many ways from deployed technology to implementation methodology, to pricing, to support model, to industries served, and on-and-on.
When selecting an ERP, look for the true differentiators relative to your organization to find the right fit.
The Value of Objective ERP Selection
Research suggests that ERP systems selection, implementation methodology, and partner selection are critical for a successful ERP organizational change project.
- Some ERP solutions cater to specific industries while some cater across industries.
- Some come with industry-specific configurations and have hundreds of preconfigured business processes.
- Some cater to specific niches with little configuration.
- Some have been around since the beginning of the ERP era and some that we don’t know about yet but will bring to the market new and exciting products with creativity and innovation.
ERP solutions utilize different models and often cater to different business needs.
- Some have all the bells and whistles and try to be everything to everyone.
- Others are very industry-specific and cater to a niche market.
- They often employ technology differently and have different approaches to functionality and business modeling.
- They have different competitive differentiators that drive how they advertise and approach the market.
- There is free and open-source ERP and there are propriety ERP vendors.
- And there are ERP vendors that focus on add-ons only.
ERP solutions and vendors all have unique tangible and intangible benefits, advantages, disadvantages, and costs. Some of them have truly unique differentiators, some don’t, and some say they do.
What matters, is not just the ERP vendor advertisements, commercials, or sales pitches, but what really makes for an organization’s success is being mindful of how critical the triad (people, process, and technology) and hence the true differentiators that ERP solutions and vendors bring or don’t bring to the table.
Look for the true differentiators relative to your organization.
Methodical, and disciplined approach to ERP Selection
“All ERP systems do the same thing. Just get in the park and pick one”. Well, actually, this is a dangerous and risky idea. And, factually, just not an accurate statement. The results of an ERP selection process can have direct implications upon and within the business. ERP selection needs to be executed judiciously, not because a salesperson or an online document tells you that there is a one size fits all “Best ERP for Small Business” solution.
ERP is one of the most valuable and strategic tools that organizations can deploy. If done efficiently and effectively, it can deliver a significant competitive advantage. But there are many selection factors to consider that contribute to success. An organization needs an applicable, methodical, and disciplined approach in order to determine its “best fit”.
There are tangible and intangible factors to consider, among them are business model fit, industry fit, ERP functionality, technical requirements, cost, scalability, software R&D spend, etc., etc.
The cost, complexity, and potential complications of implementing an ERP imply that serious consideration must be given to the selection process as well as between competing products (Neves, Fenn, and Sulcas, 2004).
Vendor Neutral ERP Partner and System Selection
Why Should Organizations Care About Proper, Un-biased, and Vendor Neutral ERP Partner and System Selection Versus a list of “Best ERP for Small Business”? Because ERP Transactions are Dollars. ERP transactions represent organizational time, money, and effort. And ultimately, they represent and drive your GL, Balance Sheet, and P&L.
There are significant organizational demands for assembling the right people, processes, and systems in an effort to improve business, save a company, improve EBITDA, improve sales, improve profits, and/or increase market share. These are all critical to the health of any organization.
ERP systems in a way act as an organization’s internal bank, financial advisor, accountant, and auditor: they manage and direct your money by providing a tool in which to manage and direct your transactions. Careful ERP consideration is well worth the effort and investment.
ERP Selection Factors
There are many ERP selection factors to consider that contribute to success. An organization needs an applicable, methodical, and disciplined approach and scorecard prior to making an ERP decision.
Friends and colleagues at Technology Evaluation Centers (TEC), an impartial software analysis firm, state that:
“Any company considering an ERP implementation needs to understand what ERP systems are on the market, which business processes can be handled or improved by an ERP system, and how to approach ERP selection.”
There is no question, that there are great ERP products and 3rd party implementers available to organizations. However, how their product may actually model your business environment, implement best practices, provide appropriate functionality, and implementation methodology can vary greatly!
For the benefit and value of an organization aside from just technical and functional capabilities or differentiators, the organization should consider in their selection process is that simply being honest about what the organization is about to initiate, endure, and ultimately accomplish is significant.
What organizations need to hear (rather than being sold)
- The ERP vendors and partners acknowledge that implementation challenges are a highly disruptive nature of large-scale ERP organization change
- Vendors being honest about the realities and expectations and challenges demonstrates professionalism by honesty and also by illustrating their proactive, detailed, and tactical plan for countering challenges when they do arise.
- Acknowledging that proper system selection, in fact, does matter.
This is what organizations not only want to hear but need to hear.
Are You Ready for a New or Improved ERP System?
At Nestell & Associates, we’ll work with you every step of the way. We have the experience and knowledge to help you select and implement an ERP system that will meet your needs now and in the future.
Episode 33: Enterprise Resource Planning: History and Evolution
In this episode with guest Dr. Shadrack Katuu, we discuss Dr. Katuu’s paper “Enterprise resource planning: past, present, and future.” As Shadrack states in his paper, ERPs (or business systems) have experienced significant changes over the last 50-60 years. Understanding the history, and a discussion of the evolution of ERPs provides insight into the ERP timelines and the presumption of improvement over time and perhaps an insight into where ERP systems are heading.
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About Nestell & Associates
Nestell & Associates is a strategy and management firm. We can help you take your portfolio companies to the next level by demonstrating how to execute a scalable, methodical, and disciplined approach to digital transformation success.
Merger and acquisition ERP digital transformations can be a significant challenge. But a solid framework is built on good practices with proven success. We have a successful track record with integrations, upgrades, mergers, and acquisitions, and we want to share our methods with you.
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