There are many reasons for needing an ERP system Among the many things to consider is whether you want to get a generic solution and customize it to your needs, or whether you want a solution that is specific for your particular industry.
The purpose of this post is to examine the differences between these two options and the ways to go about the ERP selection process.
Let’s first define the term “generic ERP,” as it may falsely evoke negative connotations with some readers. For many people, these are ready, out-of-the-box solutions that are generally non-customizable. Made for all kinds of industries, they generally have little to no room for customization. However, one of the most obvious advantages of these “one fits all” solutions is their cost-effectiveness.
However, for the purpose of this article, we are going to assume that generic ERP is the opposite of a vertical-specific ERP system – a solution that doesn’t cater to one industry vertical in particular, irrespective of its functionality and customizability.
Industry-specific ERP solutions, on the other hand, are ones that have been designed specifically for one industry – e.g., manufacturing ERP. These types of solutions have deeper functionality when it comes to the particular needs of an industry.
An ERP solution is a massive concept to begin with. Besides the obvious challenge of uniting, automating and streamlining enterprise-wide business processes, they also have to take into account things like specificities of each country, regulation systems associated with each industry, etc. As such, an ERP vendor that specializes in a particular vertical, has an advantage over competition in terms of experience, functionality of their solutions, speed, and efficiency.
The downside of these specialized ERP solutions is that you may end up with a lot of functionality that you simply do not need and are never going to use.
The Factumsoft Solution
Up till now, the downside of choosing generic ERP solutions has been their lack of specific functionality when it came to industry-specific requirements. Of course, the solution could always be added customization or integration with other applications, but that usually meant escalated costs and time management issues.
This is why at Factumsoft we have combined the best of both worlds by leveraging the richness and flexibility of our propriety platform. Although we cater to various industries, we are not confined by the rigidity of “out of the box” solutions. Having invested considerable time and resources, we have developed an ERP platform so rich in modules that address the needs of different industries, that it takes our business analysts very little time to assemble industry-specific solutions. In other words, our clients do not incur extra costs associated with the customization of generic ERP solutions to fit industry-specific standards.
We also realize that no two companies are the same, even if they are from the same industry vertical. As such, we tailor our industry-specific solution to your business by adding all the necessary customization you require.
Things to Consider during Your ERP Selection Process
It’s easy to get overwhelmed in the process of selecting an ERP solution for your company. Our experience in the industry has shown that it’s helpful to have certain guidelines when it comes to this complicated process. Here is a list of useful tips we have compiled:
- Determine the strengths and weaknesses of your business – areas that you hope your new ERP system to address and enhance.
- Decide which key areas of your business you will want to automate first so that you don’t wait around for the whole solution to be implemented before you can start enjoying its benefits.
- Develop an ERP evaluation criteria for your new solution. Things you may consider are
- The price of the new solution with respect to the level of customization. Keep in mind that more often than not, the price that you see displayed on websites or in product catalogs is only roughly indicative of the actual cost that will be incurred by your company.
- The flexibility of the platform. Your business isn’t static, nor should be your ERP system. Make sure you get a system that will accommodate not only your current needs, but has the capacity to do so as your business grows.
- The functionality of the solution. Determine whether time is of the essence and whether you need the wide spectrum of functionality offered by industry-specific ERP systems. Or are you willing to go with a general ERP provider and allocate some time for them to tailor their solution specifically to your business needs.
- Talk to companies that have implemented the solutions of the vendors that you have shortlisted. You will get a good sense of what to expect.
- Ask your shortlisted vendors to demo their solutions and explain their capabilities.
For customers, it ultimately comes down to choosing an ERP solution that will enhance their processes, not restrict them. There is no predetermined answer as to whether that will be achieved by a specialized ERP system or a generic one – it all depends on a multitude of issues mentioned above.