How to Define ERP Objectives Before Choosing a New System

Last updated: September 25, 2026. We updated this article with practical guidance on defining measurable ERP objectives, choosing KPIs and prioritizing your goals before ERP selection.

You know something needs to change.

Maybe you can’t trust your inventory numbers, leading to stockouts or unnecessary purchases. Reporting takes days of manual work, so decision-makers are working with information that’s already outdated. Your team is entering the same information into multiple systems, creating extra work and more opportunities for errors. Or the processes that worked when your business was smaller simply can’t keep up anymore.

Those problems might be what lead you to consider Enterprise Resource Planning (ERP) software. But before you start comparing systems and building a list of features, there’s an important question to answer:

What do you need ERP to accomplish for your business?

We’ve worked with 200+ small and mid-sized businesses on ERP projects, and one thing we’ve seen repeatedly is that getting clear on your objectives early helps keep the project focused on the problems that matter most. Instead of starting with what the software can do, you start with what needs to improve in your business.

In this article, we’ll show you how to turn your business challenges into clear ERP objectives, connect those objectives to measurable outcomes and prioritize what matters most before you start evaluating ERP systems.

What are ERP objectives?

ERP objectives are the specific business outcomes you want to achieve with your ERP system. They define what you want to improve, fix or enable in your business and give you a clear way to evaluate whether your ERP project is successful.

For example, your objectives might be to improve inventory accuracy, reduce the time it takes to close your books, eliminate duplicate data entry or give your team better access to real-time information.

The key is to focus on the business outcome, rather than the software itself.

“Implement a new ERP system” isn’t an ERP objective. Neither is “move to the cloud” or “automate our processes.” Those describe a technology or approach, but they don’t tell you what needs to improve as a result.

A stronger ERP objective connects your current challenge to a clear outcome:

You may also hear the term ERP implementation objectives. These can include project-specific goals such as completing the implementation within an agreed budget or timeline, successfully migrating your data and preparing employees for go-live.

Those objectives matter, but they serve a different purpose. Your ERP objectives define what you need the system to accomplish for your business. Your implementation objectives help guide how you get there.

Getting clear on the business outcomes first gives you a stronger foundation for everything that follows, including your ERP requirements and eventual software selection.

Why should you define your ERP objectives before choosing software?

It’s easy to jump straight into ERP research once you’ve decided your current systems aren’t cutting it. You start comparing products, watching demos and building a list of features you think you need.

The problem is that you’re evaluating solutions before you’ve clearly defined what you’re trying to solve.

Your ERP objectives give you that direction. They help you connect your software decisions back to the problems and priorities in your business.

ERP Research recommends identifying the business problems you’re trying to solve, the Key Performance Indicators (KPIs) you want to improve and the outcomes that are essential to your business before evaluating ERP solutions.

Clear objectives can help you:

• Keep your ERP project focused on business outcomes. A new feature might look impressive in a demo, but does it help solve one of the problems that led you to ERP in the first place?
• Make better decisions about priorities. When different departments have competing requests, your objectives give you a common point of reference for deciding what matters most.
• Define more meaningful ERP requirements. Once you know what needs to improve, you can start identifying the functionality and processes required to support that outcome.
• Evaluate ERP systems more consistently. Instead of asking which system has the longest feature list, you can evaluate how well each option supports the outcomes your business needs.
• Create a strong definition of success. Connecting objectives to measurable KPIs gives you something more concrete to work toward than simply getting the new system live.

This doesn’t mean you need every detail figured out before you start exploring ERP software. But you should be able to explain the problems you’re trying to solve and what better looks like for your business.

With those objectives in place, you have a better foundation for the decisions that come next. You can define your ERP requirements around the outcomes you want, focus software demos on the processes that matter most and compare ERP systems based on how well they can support your priorities.

How to define your ERP objectives in 5 steps

You probably already have a few ideas about what you want ERP to improve. But defining useful ERP objectives takes more than making a list of frustrations or asking your leadership team what they want from a new system.

Your objectives should reflect what’s happening across your business, including the day-to-day problems your employees encounter, the impact those problems have and the outcomes that would make a meaningful difference.

By involving the right people and working from your business challenges, you can define ERP objectives that are specific, measurable and useful when it comes time to evaluate ERP systems.

Use these five steps to get there.

1. Ask employees where your current processes are breaking down

Start with the people who work with your processes and systems every day.

Your leadership team may know where the biggest business problems are, but they won’t always know why those problems are happening. Employees working in finance, operations, inventory, purchasing, sales and other areas can help you uncover the bottlenecks, duplicate work, missing information and manual workarounds behind them.

Useful questions include:

• What tasks take more time than they should?
• Where are you entering or re-entering information manually?
• What information is difficult to find?
• Where do errors happen most often?
• Which spreadsheets or workarounds have become essential to your job?
• What prevents you from serving customers as quickly or accurately as you’d like?

You’re looking for patterns. If several people or departments point to the same underlying issue, that can be a strong indication that you’ve found a business problem worth exploring further.

2. Identify the business problems your ERP needs to solve

Now you can take what you’ve learned and identify the problems that are driving your need for ERP.

These might include:

• Inventory discrepancies
• Too much manual data entry
• Disconnected systems
• Slow or cumbersome reporting
• Limited visibility into business performance
• Difficulty forecasting demand
• Processes that rely heavily on spreadsheets
• Systems that can’t support your current transaction volumes or future growth

Try to get specific about the impact of each problem.

For example, “reporting is difficult” doesn’t tell you much about what needs to change. You might discover that your finance team spends several days every month combining data from different systems before management can review the numbers.

Understanding the impact helps you identify which problems should become priorities for your ERP project.

3. Turn those business problems into specific ERP objectives

Once you understand the problems, describe what you want to improve.

Your ERP objective should be specific enough that you can eventually measure whether you achieved it.

For example, “improve inventory management” is too broad. What does improvement mean for your business? You might need to improve inventory accuracy, reduce excess stock, prevent stockouts or get better visibility across multiple warehouse locations.

If inventory accuracy is the real problem, your objective could be:

Problem: Warehouse staff can’t rely on the inventory quantities in the current system.

Objective: Improve inventory accuracy across all warehouse locations.

Or:

Problem: Finance spends several days consolidating information before it can produce month-end reports.

Objective: Reduce the time required to complete month-end reporting.

Being specific about the outcome makes the next step much easier because you know exactly what you need to measure.

4. Choose KPIs to measure your ERP objectives

For each objective, identify at least one KPI that will tell you whether things are improving.

Depending on the objective, that could include:

• Inventory accuracy rate
• Days to complete month-end close
• Order processing time
• Stockout rate
• Forecast accuracy
• Hours spent on manual data entry
• Time required to produce key reports
• Order error rate

Where possible, document your current performance as a baseline and set a target.

For example:

Current state: Inventory accuracy is 85%

ERP objective: Improve inventory accuracy across all warehouse locations

Target: Reach 98% inventory accuracy

That gives you a much more useful objective than simply saying you want “better inventory management.”

You won’t always have reliable baseline data when you start this process. Poor access to data may be one of the reasons you’re considering ERP in the first place. In that case, don’t make up a target just to complete the exercise. Identify the KPI that matters and establish your baseline as part of your ERP planning process.

5. Prioritize your ERP objectives by business impact

You’ll probably end up with more objectives than you can treat as equally important.

Prioritize them based on the impact they have on your business. Consider which problems create the greatest operational risk, consume the most time, affect customers or limit your ability to grow.

It can help to separate your objectives into categories such as:

• Must achieve: Outcomes that are fundamental to the business case for ERP
• Should achieve: Important improvements that would create meaningful value
• Could achieve: Useful improvements that aren’t central to the ERP decision

This prioritization becomes especially valuable when you start defining requirements and evaluating ERP systems. When every request can’t carry the same weight, your objectives help you decide where to focus.

Once you’ve worked through these five steps, you should be able to connect each business challenge to an ERP objective, a way to measure success and a level of priority:

Business challenge → ERP objective → KPI → Priority

Here’s what that might look like. The priorities below are examples only. Your priorities will depend on the problems and goals that matter most to your business.

Your ERP objectives are the starting point for your requirements

Choosing an ERP system is a big decision, and it’s easy to get pulled into feature lists, product demos and conversations about what different systems can do. Without clear objectives, those conversations can quickly lose sight of the problems you set out to solve.

That’s why defining your ERP objectives is such an important early step.

Your objectives tell you what you need to accomplish. Your requirements help you determine what your ERP system needs to do to support those outcomes.

If you’re ready to start defining those requirements, use our ERP Requirements Gathering Template to identify, organize and prioritize what your business needs from a new ERP system.

If you’d rather have some guidance through the process, that’s where we can help. At ProjectLine, we help small and mid-sized businesses define what they need from ERP, translate those priorities into clear requirements and evaluate which systems can support them.

Frequently asked questions

What are the main objectives of an ERP system?

The objectives of an ERP system will depend on the problems your business needs to solve. Common objectives include improving inventory accuracy, reducing manual data entry, improving access to reliable business data, streamlining financial reporting and creating more consistent processes across departments.

Your objectives should be specific to your business rather than based on a standard list of what an ERP system is supposed to accomplish.

What is the difference between ERP objectives and ERP requirements?

ERP objectives describe the business outcomes you want to achieve. ERP requirements describe what the system needs to do to help you achieve those outcomes.

For example, your objective might be to improve inventory accuracy across multiple locations. Related ERP requirements could include real-time inventory visibility, barcode scanning and inventory transfer controls.

Defining your objectives first helps you build ERP requirements around real business needs rather than a list of software features.