ERP System Evaluation and Selection Checklist - SystemsAccountants

Estimated reading time: 6 minutes ERP System Evaluation and Selection Checklist

Selecting the ideal Enterprise Resource Planning (ERP) system is a strategically critical decision that can shape and affect the future of your business. The right system can enhance planning, boost productivity, and help your company achieve its strategic goals. In fact, 95% of organisations have witnessed tangible enhancements in their operations by choosing the right ERP system.

To simplify the typical ERP selection process, we’ve divided it into four key phases: business systems strategy definition, functional and technical requirements, scripted demonstrations, and deployment contract and license negotiation. Within these four phases, we’ve outlined 11 clear steps to guide you in choosing the best ERP and finance system for your business.


1. Conduct an ERP readiness assessment

The first part of the process is to establish if the organisation is ready to deploy and take on an ERP implementation project. Do you have the appropriate team in place? Are there any significant events in the near future that mean this is a bad time to begin? Is the organisation aligned cross-functionally on the need for and objectives of the proposed system? These questions need to be answered at the outset, but also throughout the implementation process by the Selection team and the Steering team.

2. Create a vision and communicate the strategy

A clear vision is essential for ERP implementation to make the intended impact. The goals you set should progress the finance function’s objectives, and also align with business goals. “ERP systems offer strategic and quantifiable benefits, and should help to enable the Business Strategy,” says Justin May, Managing Director of Truskey Consulting. “Deploying the system is essentially a very significant business change management project requiring communication with all stakeholders.” You can win over relevant stakeholders by identifying the specific ways the new system will alleviate their existing pain points.


3. Involve key stakeholders

Moving into the requirements phase of the selection process, the first step is to involve the right people and to make them feel involved in the process. Communicate with senior stakeholders within the finance team to get buy-in for changing to a new system, and listen to other ERP users about their needs. 

4. Determine business requirements and objectives

Develop a comprehensive list of requirements – both functional and technical – and prioritise them into ‘must haves’ and ‘nice to haves’. Identifying pain points with your current system will help you draw up this list. Ensure that you also think about your future needs, as well as current requirements. You are not looking to replace your current system with a new version of your current system which is likely not fit for purpose to meet current or future needs.

5.  Set a budget 

When setting the budget, don’t forget to think about the range of costs, such as software licensing, implementation, support, any custom solutions, integration with third-party solutions, hiring new people, and training. For more information, read our article on how much an ERP system could cost. Beware of going over budget – and have a contingency budget. The 2023 ERP Report from Panorama Consulting Group found that 47% of organisations went over budget on their ERP implementations.

6. Hire the right people

ERP systems are not plug-and-play. Processes need to be updated, additional systems integrated, and the platform tailored to meet your organisation’s needs. This is unlikely to be successful without experienced talent in place. Your team needs to be pro-active and adaptable, and any contingent hires need to bring deep expertise, confidence, and objectivity.

7. Draw up a shortlist of vendors and solutions

Take some time to understand the key features of ERP solutions. There are multiple providers, three different types – on-premise, cloud-based and hybrid – and dozens of systems to choose from. Draw up a realistic shortlist of vendors and solutions that will likely best align with your Functional and Technical requirements, and also those deployment/implementation partners that will work well with you and your business.


8. Ensure an “apples” to “apples” comparison from one system and deployment partner to another. 

Moving into the demonstration phase of the selection process, it’s important to have the knowledge and expertise to allow you to treat vendors’ sales pitches with the necessary objectivity.  Do your own, independent comparison of systems, ensuring you’re comparing like-for-like and evaluating the appropriate criteria. 

9. Use a structured demo script to manage the process

Ensure the demonstrations are structured and documented. Document each script, and use the Demo to visualise how the ERP solution will potentially deliver your key requirements. You should discuss all key requirements (the ‘must haves’ on your list), and approaches to deployment and support. Consider how the ERP solution will integrate with existing systems, and bear in mind future scalability. 

10. Check the ERP deployment partner’s ability to deliver

Find out whether the ERP provider has experience within your industry, and has a good record of keeping up with technology developments. It’s also possible to ask their prior customers for references.


11. Negotiate the contract

You’re now in the final phase. You’ve been regularly conducting ERP readiness assessments, but do so again now before you sign a contract: is your business ready to proceed? It’s important to understand the difference between legal and non-legal documents, as there’s limited scope to change legal documents with the larger ERP partners. Be prepared for the vendor to carry out due diligence workshops to confirm the scope during the BAFO (Best And Final Offer) process. This shows commitment from the vendor. Finally, as well as negotiating the price, clarify the start date and the key deployment team members and include it in the  Statement of Work or contract – whatever is most appropriate. This is important for the vendor and for you.

Becoming ERP-ready

Selecting the right ERP system is a key multi-year strategic investment in the future of your business. By approaching this selection process in a structured way, you can mitigate risk and ensure that your choice aligns with your organisation’s unique needs and values. By following these 11 steps, you can navigate the complexities of ERP selection with confidence, ultimately securing a solution that drives sustainable growth and operational excellence for years to come.