10 Key things you need to know before choosing a new ERP solution
Do you want to start from scratch, build on top of your current system or get started with a standard solution that is optimized and adapted to your industry? Because trying to reinvent the wheel might not be a good idea when selecting your future ERP solution.
When looking for a new ERP solution, you basically have three options: Building your own from scratch, customize a standard ERP solution to your needs, or choose beverage specific turn-key ERP solution developed, optimized and adapted to meet the specific needs of the beverage industry.
Selecting a solution that is industry-specific basically means that you start creating value for your business faster. An industry-specific ERP solution can offer you functionality and configuration that ‘out-to-the-box’ matches your business processes and needs within finance, sales, distribution, production and quality control, as well as contract management, CRM and reporting.
After all, there’s no need to start from scratch when you can get a solution that already has proved its value for many other beverage businesses, right?
Best practices included
Another benefit of an industry-specific ERP solution is that it has been developed by a vendor with deep insight into your industry and experience from a multitude of similar projects. This ensures that you get the best advisors and reduced project risk and costs – and that you can expect faster implementation. Industry-specific ERP solutions for beverage companies are often built on industry best practices. This means that the software solution reflects a proven optimal and effective way to perform each business process in a beverage company. This can have a great impact on your business. Running your beverage company according to industry best practice will make your business more effective and competitive.
Investing in a new ERP solution is a significant investment. But how big is it actually? When buying a new beverage ERP solution, think about the Total Cost of Ownership (TCO). TCO is used to calculate the total cost of purchasing (or, in case of cloud computing, the cost of subscribing to) and operating a technology product or service over a period of time.
TCO usually includes direct and indirect costs like application subscription or license fees, application, design, configuration and implementation, administration and maintenance and training.
Although many companies factor TCO into the purchasing equation, they often underestimate the hidden costs of a new technology solution, which can result in negative consequences.
For example, if you don’t have the resources needed to adequately maintain a solution, you may skip upgrades to keep the solution running securely and at peak performance. Or if the sufficient time and expense needed to train employees on the new system is not included, potential productivity gains will be lost.
Always compare TCO’s from competing solutions
Looking at the TCO gives you a strong starting point for making the right choice. When two solutions provide roughly equivalent benefits over a defined period of time, but have different types of cost associated with acquisition, maintenance and operations, a TCO comparison gives you a framework to better evaluate competing solutions, and helps you avoid hidden costs and unwanted surprises.
When you buy an ERP system, you are not just buying a static product. You are actually forming a continuous relationship with the vendor – a relationship based on the trust that the vendor will continue to keep the software updated and supported for many years to come.
Be aware of the fact that many systems become money-machines for the vendor and hence a milestone around the next of the user – you. Often times vendors will shift strategy or get acquired. In that case, their investment is their software might stop and the roadmap will end, leaving you with no more upgrades, enhancements or new functionality. Just imagine the consequences of lacking future support of new regulatory demands.
Benefits from endurance
If your joy in producing beverages is more important to you than wrestling with technological challenges, you should look for a beverage solution that is developed on a proven and future-proof technology from a vendor that can show a strategic, long-term focus on continuous research and product development.
Go for a solution from a vendor with the endurance to continually develop new and compelling functionality for your platform. Don’t put your business at risk by choosing a platform that looks attractive today but might become outdated tomorrow.
The risk of a potentially painful, lengthy, complex and risky implementation project can hold any beverage back from ERP projects. True, the deployment of an ERP solution is a major change – but the process does not have to be long and tedious.
Check the average time of implementation
Lengthy ERP deployments equal costly ERP deployments. Our experience shows that the deployment time of real transformational beverage ERP efforts may vary up to as much as 30%. Your first step towards mitigating the risk of a lengthy and costly ERP project is to focus on the average time of deployment of the solution you are looking at. You might be surprised.
The market changes and so does your business. If your software remains static, the result is a disparity between the way the solution was originally implemented and the new requirements of the business. This evolution continues until you get to the point where the processes in the system actually narrow the ability of users to efficiently run your business.
State-of-the-art beverage ERP solutions offer flexible business processes based on best practice and process tools such as workflow, which give you the ability to set up and change process flows within the system. This means your workflows can be changes as your preferences and requirements evolve.
Make sure your new beverage ERP solution is able to embrace both expected and unexpected changes, so your business processes maintain their flexibility and adaptability.
Bringing your excellence across boarders and to new hubs
Are you considering expanding in your home market or going into new markets? Or have you already expanded and are looking for a way to consolidate your business? Either way, brining operational excellence with you into an expansion is vital for success.
When selecting a new beverage ERP solution, you need to consider an expansion scenario. Consider what kind of ERP type you would like to implement in the short and long term – and make sure that the ERP solution that you are considering supports your plans.
Depending on your needs, be sure that your solution supports a single-instance implementation, a multi-instance implementation and a two-tier (hub-and-spoke) implementation. This way you have maximum flexibility to operate in the future, no matter which path your business might take.
Be sure that you select a system that is born modular. Modularity allows you to optimize a single business process, tie several areas and processes together, or rethink your entire value chain. You can start small, or big. Make sure it is your needs that determine your approach – not the design of the solution.
Beware of bricks that don’t fit
When you are looking for a modular solution, beware of the bricks that don’t fit. In some solutions, separate modules might have been written at different times by different programmers. The look and feel could be quite different between modules. Separate modules might have duplicate or redundant data, too.
So, when you’re looking for your new beverage ERP solution, be sure to take a closer look at the brick – do they actually fit together?
Mobile devices are an important extension to ERP. The goal is to unlock workforce productivity with two distinct benefits of mobile devices. The first benefits are the mobile devices’ enhanced user interface, featuring portability, high-screen resolution and finger-swipe functionality that promotes productivity.
The second benefit is extending the reach of ERP systems to employees, partners and even customers, to when they need it, where they need it. The combination of mobile devices and ERP business systems empowers workers and makes it possible for them to engage more fully with their peers and customers.
Mobile ERP solutions deliver real-time access to business operations and can steadily increase profitability through lower transaction costs, improved cash flows, enhanced communication and better customer relations. While it is unlikely mobile ERP applications will altogether replace traditional desktop ERP applications in the near future, they help meet the need for agility and flexibility in today’s changing business environments.
When looking for your new beverage ERP solution, be sure to ask for the level of mobility support the solution offers.
Most businesses today have more data then they know what to do with. And getting to that data and then presenting it in a useful manner for convincing analysis are two tasks that many organizations find difficult.
State-of-the-art beverage ERP solutions help you pull data and create reports at the click of a button, access better info to remain ahead of the competition, and monitor past and present performances to make better-informed decisions.
To realize better decision-making, you should go for an ERP platform that offers both rich reporting options and integrates smoothly with leading and proven Business Intelligence (BI) tools. This will help your beverage business keep track of information and make that information accessible to employees, management and board members that need it – when they need it.
If you are considering a new beverage ERP solution for your business, chances are you are being bombarded with choices. As you consider your options, one of the most important decisions you will need to make is whether to select a cloud-based ERP solution or one that’s installed locally.
The basic difference between on-premise ERP and cloud ERP is clear: on-premise ERP solutions are installed locally on your company’s hardware and servers and then managed by your IT staff while cloud ERP – also called SaaS, or Software-as-a-Service – is provided as a service. With this type of deployment, a company’s ERP software and its associated data are managed centrally (in the Internet “cloud”) by the ERP vendor and are accessed by customers using a web browser.
A few points to consider
What may not be so clear is that the type of ERP deployment model you choose can have a significant impact across your business. Making the choice between on-premise and cloud must rely on the current and future situation of the company.
Here are a few points to consider:
Taking the time to consider how different ERP deployment options will affect your company is critical. Look for a vendor that offers the competences to help you with both models – a vendor that knows the advantages and disadvantages of both deployment models.
Now that you have narrowed down the technology options that would fit your particular needs and goals, it is time for the litmus test. You want to be sure that the provider of the solution has delivered projects that have successfully solved challenges of other beverage companies similar to yours.
The only way to find this out is by speaking with reference clients. Talk to at least three references and ask them what went right, what went wrong and what they might have done differently.
If a vendor cannot provide at least three verifiable, happy customers, that vendor may not have the experience you need.
A state-of-the-art beverage ERP solutions can provide a host of advantages for your business. The ERP system is your information backbone and reaches into all areas of your business and value chain. Replacing a legacy ERP solution can open unlimited business opportunities. The cornerstone of this effort is finding the right solution and partner. Your long-term business strategy will form the basis of the criteria for your selection of an ERP system replacement. Your ERP provider must be part of your vision. It is the duty of a software provider to help you get there by helping you make sure your next system will be your last ERP system replacement.
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