It takes awhile to decide if a new ERP is the right choice for your organization. There are social, operational, financial and technical hurdles that need to be viewed, discussed and solved. This process takes time, and it can consume years, instead of weeks. If you have ever lived with choosing the wrong ERP, you have experienced the pain, tears and ridicule that comes with your decision. The point is… Take your time and find what works for you!!
The problem with traditional and SaaS ERP is that it does not support your natural ERP evaluation process. For example, ask Netsuite or Microsoft Dynamics for a free, fully functioning, 2-year license and see how they respond. You need the right tools available to you for an extended period of time to make the right choice. Here are some of the concepts that drive successful and cost effective evaluations. More information can be found here.
- Look for success stories in the same or related industry from companies with similar characteristics.
- Install the system locally or using Amazon’s AWS service. For example, you can install a fully functioning iDempiere (free and open source ERP) in the cloud with a single command using this post.
- Play with demo systems with simple scenarios (like replicating this iDempiere demo). You will most likely break things. That is OK. Just create a new instance. You should be able to easily install as many versions as needed.
- Create one or more proofs of concept (POC) using real data. Focus on the key challenges your company faces. Focus on the processes that drive innovation, strategic advantage and profitability. Be aware that the ERP you are testing just might not be the right choice. Do not be afraid to switch. Switching takes time, but the pain you save yourself will be worth it.
- Find a talented coach or team that can support your company’s needs. Be prepared to interview the real people (not the sales people) that will support your project. Be prepared to fire your first choice. Your ERP support needs are deep and varied. Integrators need to know a myriad about best practices (processes, accounting, technology, and more), and they need to fit your culture.
- Avoid partners that drive up needless costs or introduce barriers toward finding the right tools and partners.
- Software evaluation services like TEC increase costs indirectly. Evaluation services asks integrators for between $6K to $30K to get included or preferred on the site. If integrators do not pay the price, they typically will not be included in the list. If they do pay the price, they have no choice but to pass the cost on to you. This ‘listing and advertising’ cost is in addition to the licence costs from Microsoft or Sage. Now that you know the real costs of these services, make sure they deliver the value to back up the cost.
- ERP software companies like Microsoft view integrators as their primary customer. As an end user, you play second fiddle. ERP software providers will call on integrators (not end users) to drive revenue and new installations at the end of a quarter. This was my experience when I was the director of IT and a Dynamics customer. I needed to replace my integrator, and the Microsoft rep said she had to protect the integrator of record. She would not help me find a better Dynamics integrator.
- If you do use commercial ERP, do not pay licenses until after you go live. Licenses are a reward for value. You will not derive any value until after the software successfully goes live. Take your time when going live. Putting a premature system into production will likely cost you 10X in cleanup costs over the delayed launch. Anyone who has cleaned up an accounting mess can attest to this situation.
- Set up multiple environments. These instances are needed for the go-live process, testing and disaster recovery. With open source ERP (ADempiere and iDempiere), you may install as many environments as you wish with no additional software costs.
Open source ERP gives you every opportunity to prove or disprove its ability to support your company’s ERP needs on a timeline that satisfies your organization. With open source ERP, you do not face the same financial constraints nor do you face the same conflicts of interest as with commercial ERP. Instead, you invest in the appropriate skills and knowledge for your people and processes. Best of all – if open source ERP cannot solve your company’s needs, you can safely justify spending the additional $2K to $5K per person per year for life of your commercial ERP to help drive your organization’s success.
I hope this helps!!
ADempiere vs iDempiere vs Openbravo vs Compiere
Please note that ADempiere, iDempiere and Openbravo are forks or copies from Compiere. Therefore, they have similar abilities mentioned above. The biggest difference is that ADempiere and iDempiere are pure open source. There are no features held behind a commercial or paid license.
About Chuck Boecking: I am an ERP educator. I believe that open source ERP have achieved mainstream capabilities, and as a result, more companies can create greater efficiency across their organization. I started using the iDempiere code base in 2003. Back then, it was called Compiere. In 2006, I started my first multi-million dollar installation. Since then, ADempiere has helped me create great success with distribution and manufacturing companies all over the world. My vision of success is to find companies that can best use open source ERP to help them achieve a single, global instance that drives a discontinuous increase in profitability. I believe that organizations win when they own their technology.
If you have questions, comments or concerns, let me know. I definitely want your feedback.
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Thank you for taking the time. I look forward to speaking with you.