ERP … Do You Want Fries With That?

I’m not sure exactly when it happened, but commoditization of ERP in the accounting software market seems to have rendered the term almost meaningless. The software category Enterprise Resource Planning has evolved over a couple of generations, as its definition has morphed for new and smaller markets (for industries outside of manufacturing). Software vendors and I.T. firms have misused the term and confused the market to the point that no one really knows what ERP is anymore.

For companies that are looking to implement an ERP solution, the task is made more challenging. In a confused market where all the vendors claim to do the same things, you need to dig deeper and understand how the ERP solution’s features and functions map to your business processes and operational requirements. This can be quite a laborious exercise, but a necessary one.

Secondly, the services firm that you choose to do the software implementation needs to have a level of knowledge and experience that is broad in scope. An ERP system typically encompasses accounting, HR, supply chain, distribution, and other areas, so you need to select a professional services company that can manage the automation of these departmental and cross-departmental processes. This is a big task that requires a very capable team. The firm also needs to understand how to roll out the software across the enterprise. Getting users trained and proficient, and gaining company-wide “acceptance” of the solution is an art and a science that is rarer than one might think. It is not for the faint of heart.

I should clarify that Softrak’s Adagio Accounting software is not an ERP system. Adagio can handle the pure accounting and sales order processing requirements of a manufacturer, but we don’t provide the breadth of applications that would comprise a typical ERP solution. We focus exclusively on the accounting. That said, we are an interested observer of this space, and cringe when we see vendors selling ERP solutions for less than the price of their client’s monthly office coffee service. ERP buyers beware – and do your due diligence.