You are choosing the right tool set to run your business. You must choose the tool set that will let you get your jobs done. What do you think about when I say the word, hammer? Is it the right tool to pound a 4” wooden fence post into the ground? Probably not. There are hammers for finishing wood, heavy construction, metal, leather, tires and other uses. Selecting a 16-pound sledgehammer to pound in a finishing nail is a bad choice. Not only will you be unable to drive the nail, you will likely damage the wood.
Words are inaccurate. Make sure that as you discuss your needs that your word pictures are accurate and as detailed as possible. You have jobs that you need to do; if your software is unable to do them, you will be doing many things manually that you should be doing with your business system.
Price and features are an important piece of information, but even more important is the ability to see the payback from the system. Let’s say that one business management system has a price tag of $150,000 and another is $250,000. (The numbers are relative; it could be $1,500,000 and $2,500,000.) Both prices include implementation.
Not much to go on to make a decision, is it? Most of us would go with the $150,000 solution. Now, imagine that the salesperson for the $250,000 solution shows you a way that you can decrease your inventory by 30% which will increase your bottom line profit by 50% and how the system will increase your ability to handle 50% more sales volume without increasing administrative staff. Which system is the better deal now? Price is not the real cost of the business management system. The real cost may be lost business, increased personnel cost, lost warehouse space or low profit margins. That is where the business acumen and experience of the VAR come into play.
People love to say, “A debit is a debit no matter what accounting system you buy.” That is true. However, ERP or accounting software is so much more than debits and credits. ERP can and should be the tool that allows you to leverage your people to obtain the results you want to achieve. That is the real value in the business management system.
So, what specifically do I need to look for in my product selection? Here are several things that we view as important:
Can you put the software in stock, out of the box and run your business? If you can’t, does the software offer the ability to personalize, customize, interface to or modify the stock product? These are our definitions for these words:
- Personalize – each user can make changes to simplify or reduce clutter on the screen, addsor edit existing reports – almost all companies can use this functionality as this provides a simpler, work tuned environment by getting rid of unused menu items.
- Customize – these are more complex changes that an end-user typically will not be able to do. These changes may include adding additional functionality to screens, creating custom views or reports, interfacing with outside systems.
- Interface to—the ability to export and import data for daily work product coming from another system (EDI, Web store, data collection, etc.).
- Modify – complex changes that change the business logic of the stock program. These are changes made by a programmer who is familiar with your software.
As much as we try to put stock software into every client, we can’t do so. Every client has some unique functions that define the business and give them an advantage in the marketplace. While reviewing our client base before adding Microsoft Dynamics NAV to our product line, we found that 53% of our current installations required some change. Many of them only needed tweaks to reports; others needed some level of changes beyond the end-user ability, and a few needed major work to accommodate fulfilling their business promises.
Is there a community of developers who specialize in the software you are considering? There is one other level of significant functionality you need to find out about – that of the Independent Software Vendor (ISV) or third party software. The ISV is a company not related to the software developer or the VAR. The ISV is a company that has developed a special feature set to meet a specific set of needs that the software either doesn’t handle or may not handle as well as someone wants it to. Sometimes this feature set is a whole module to handle an industry specific requirement.
Many companies need the power provided by an ISV solution. Think of this like the customized travel van. A company takes a stock Ford, Chevy or Dodge van and converts it to a fully outfitted van with TV, fridge, plush custom seats, perhaps a bed or table or other amenities. The ISV provides the custom solution without the custom price.
Some people feel that a third party solution means that the software is deficient. In reality, the ISV is providing specific industry expertise that is difficult or impossible to obtain in a general software developer. ISV solutions may exist for requirement such as freight or parcel shipment integration, warehouse management or shop floor data collection systems, custom business intelligence and forecasting tools, as well as many other areas of specific industry knowledge.
Some software companies “OEM” the ISV solution by relabeling it with their own name. It is important to know this as you are buying the expertise of the ISV, in addition to the expertise of the software developer and the VAR. Find out how many installations the ISV has done of this add-on; what is their upgrade policy; who provides support – ask all the same questions you have for the main software developer.
Does the software developer certify the ISV solution? Make sure that you have a firm understanding of this relationship.
How well does the software handle my requirements (insert your definition here)? Try to ignore the unfamiliar process and screens. Does the software cover all the elements required to resolve your business issues to help you reach your business objectives? Does it take 14 steps to do something that you do every day? Does it take three steps to do something that currently takes you 15 steps? This is the time to challenge the software. Your VAR should have designed a demonstration that illustrates resolving your biggest issues. Don’t plan to understand the how’s, but can you see a straight path that will get you to your objectives? This is not about functionality, but it’s about fit. Functionality will take you into the forest and lose you in the trees. Fit is getting a fix on the size of the forest while staying alert to where you are in the process.
Will the software grow with you as your business grows? Ask about size limitations or constraints. Are these constraints in line with your business plan? How far will the software take you? Should you view this as an interim step until you grow past that next plateau?