Enterprise Software: A guide for choosing the right enterprise software for your business
Today, the enterprise software is playing a crucial role in defining success of the company. Choosing right enterprise software to help employees achieve success is very critical. You can think of the enterprise software as equipment, without good quality and properly designed machine, you cannot make a good product. Similarly without neatly designed software, you cannot achieve your targets.
Looking at software as a machine will help understand the importance of the selection. It will also help identify what qualities are needed and what are not.
There are various Customer Relationship Management (CRM), Supply Chain Management (SCM), Enterprise Resource Management (ERP) and productivity software available. Many software are available as an open source free to use software. It is very important to choose the right software to avoid frustration and thus don’t get lured by open source software. We have tried to list seven major considerations for choosing right enterprise software for your company.
1. Identify the need
2. Determine the performance targets
3. Do your homework to develop structured workflows in the company
4. Cost Analysis
5. Initial planning and employee training
6. Disciplined Operations
7. Software is an expense and not an asset.
So let us get into details of these aspects of choosing right software.
1. Identify the need: Just because your competition or everyone around you is using software does not necessitate buying it. Every business is unique and has unique set of challenges and opportunities. So even before you decide to buy software or listen to presentations from vendors, please analyze your business and identify the need. There is a term in industry called “staple yourself to the order”. That means you should analyze every step in the process of acquiring orders, executing those orders and receiving payment for those orders. By reviewing every step of the business, you will be better placed to identify opportunities to automate, reduce processing time and avoid duplication. You will be surprised to know that lot of processes are unnecessary and are just a carryover from the past.
2. Determine the performance targets: once you identify the need, then you have to determine the targets. This is very critical step in final selection of the software as this defines what kind of tool your organization needs. If you need a better customer service then CRM is the solution, if you need a better cost control then ERP is the solution, if you have a compliance requirement then financial accounting software is the solution. There are many companies offering complete integrated solution and may try to sell complete package but if you do not need certain part of the package then please do not buy it. It will add complexity and may hamper productivity instead of improving it.
3. Do your homework: Once you select which areas of your organization need improvements then you can start your homework and analyze all processes. Using the software will be helpful only if there is a process that can be tracked by the software. Many organizations make the mistake of changing the process of the company to meet the requirements of the software. It is not in the best interest of the company to do so and hence first streamline processes to meet targets and then ask the software vendor to match those requirements and create workflows which match your process. This will help develop better control over your process and there by saving training time.
4. The cost: While performing cost-benefit analysis of the software, consider the complete cost of making that software work that means you have to add the cost of license fee, monthly maintenance fee, the cost of creating the databases, the cost of training your employees and the lost time due to new processes. Many companies completely ignore the last part. Cost of training the employees is important but when you incorporate change at the workplace, employees will see reduced productivity and you have to consider that extra time into the cost-benefit analysis. Another important aspect of performing a cost-benefit analysis is that it should be done either in-house or via third party consulting firm. Never ask the vendor or consulting arm of the vendor to perform the analysis, if you do that, you will always get a biased, very attractive cost-benefit report.
5. Long term success: Long term success of the software does not depend on launch time or time taken to train your employees in the beginning; the success depends on how efficiently your employees use it and how much improvement is seen in the productivity. So it will not be a good strategy to focus on launch date or implementation time. The company should focus on employee training and productivity tests.
Buying a software and implementing it is just a beginning of the whole process, the target of the firm should be to achieve promised benefits and the company should never lose sight of that goal.
6. Discipline: Preparing your organization to new software or new process involves a lot of work. And most important of all is incorporating discipline. Discipline in employees will define success or failure of the process. Aligning incentive structure and penalizing employees for indiscipline are good strategies to maintain the required level of seriousness and discipline. Your software is good only if the data entered into it is good so you have to pay a lot of attention into data collection and data entry.
7. Software is an expense: Many companies make the mistake of looking at the software as an asset. They proudly announce implementation of the software to media and on their websites. But they should not forget that software has no residual value. All software contracts include non-transfer clause, that means if you are not satisfied with the software and want to get rid of it, then you get no compensation back. A machine can be sold in second hand market if it does not fit your need but once you pay for software its an expense. So small businesses have to be very careful while selecting the software and should look into potential consequences before taking the decision.
You may feel that I am suggesting not to implement advanced enterprise software for your business. But that is far from true, enterprise software are vital for success of the corporation and you should equip your employees with best tools available in the market but at the same time you should not forget that giving a wrong tool does more damage than having no tool at all, so businesses have to be very careful before choosing the tool.
If you feel that your corporation needs help in selecting right software and need an unbiased cost-benefit analysis, then please contact us. Our team of experts will be glad to assist in analyzing your process and come up with right recommendations, Click Here and fill out a simple form.