Purchasing An ERP System? – Top 10 or the Matrix?
Posted on: May 6, 2015 | By: Jim Bertler | Acumatica, Microsoft Dynamics GP
As a company prepares to purchase an ERP system they often try to identify objective criteria for the selection. Many departments and stakeholders weigh in on the decision and development of criteria. As more and more people get involved the decision criteria tends to grow. We believe you have to create user buy-in so including a big group is great. However, as the number of requirements grows it can become unwieldy. So the questions becomes how to handle all of the requirements.
The most common approach is to create a spreadsheet typically by department with a list of criteria. Then each criteria is ranked as high, medium or low so it is weighted. The last step is then to score each demo or software against those criteria. The thinking is that you have now created an excellent matrix and the software with the highest score will win. This may seem logical and objective, but I would like to suggest another method for choosing the right ERP system.
At Logan Consulting, a Chicago based Acumatica and Microsoft Dynamics Partner we believe the Top 10 list is the better approach. The Top 10 approach works like this. As you are gathering requirements define a list of your top criteria. It doesn’t have to be exactly 10, but some relatively small number of criteria that are absolute “must haves”. We aren’t talking about items like being able to select checks for payment by due dates or having credit limits on orders. The reality is that every new system will have these features. The Top 10 list is the difference makers to your business. This might include things like understanding the reporting engine and functionality. The forecasting functionality of the solution or the integration tools available.
So why do we recommend the Top 10 approach. The reason is that with the matrix scoring model you run the risk of a system scoring well on lesser criteria and being below average on one or two key criteria and you end up with a system that misses important needs. The reality is the goal is to select a system that hits the major requirements the best. In addition, when the matrix approach is used we find that every requirement is listed as being of high importance. This approach doesn’t force the critical thinking needed to define key criteria.
So as you prepare to purchase an ERP system. Consider the Top 10 approach and force your organization to define the key decision criteria and choose the solution that meets those needs.