When you start researching ERP solutions, you’ll quickly find that they all have a long list of features, some of which you likely won’t need. It can be overwhelming, especially if this is your first ERP implementation. ERP systems are designed to be comprehensive and include functionality for every part of a business. In the long run, this works to your benefit as you can start with the most critical features and implement additional functionality as it’s needed over time. This is the beauty of ERP – it’s scalable.
Instead of looking at a bunch of systems to see what they offer, start by working through this checklist and identifying the functionality you need. This will make it easier to evaluate ERP solutions based on whether the functionality is built-in, can be added with a third-party integration or would need to be custom built.
A couple things to consider before you start mapping out your ERP requirements:
Think about functionality in the long-term. Where will your business be in 5 years? 10 years? 15 years? You want to choose a system that will support you for years to come, so don’t limit yourself by choosing a system that only meets your current requirements.
Consider current functionality you have and need to maintain. But also include features that would make life easier for your team – think about where the pain is in your current processes.
ERP Functional Requirements to Consider
Sales and Customer Management Requirements
Create sales quotes / estimates based on item price lists
Process sales orders from multiple sales channels and manage order fulfillment
Track and manage sales opportunity pipeline, including reporting
Centralized customer account and contact management
Integrated eCommerce sales channel
Create purchase orders and quotes
Manage item price lists and multiple units of measure
Return Material Authorization (RMA) process to manage product returns
Manage vendor relationships including payment terms
Purchasing reporting and analysis
Inventory & Warehouse Requirements
Manage inventory across multiple warehouses
Track inventory movement (in / out / transfer)
Perform inventory and cycle counts
Check available-to-promise inventory
Manage multiple units of measure and multiple item prices on inventory
Job / Project Management Requirements
Job costing to track all relevant costs against each job completed
Plan and manage resources across jobs / projects
Bill against contract phases or milestones
Track time, expenses and materials against jobs / projects
Report on individual job / project performance in relation to budgets
Analyze production costs
Forecast production capacity
Plan production resources and materials
Manage multi-level bill of materials (BOMs)
Accounting & Finance Requirements
Forecast and manage cash flow
Process deposits and incoming payments
Accounts receivable and accounts payable processing
Create and manage budgets
Perform comprehensive financial reporting
Integrate payroll processing and management
Income tax administration
Manage employee performance
Self-service portal for employees
Support for multiple branches or companies
Support for multiple currencies
Integration with external applications and software
Mobile device access
Deployment & Support Requirements
On-premise ERP deployment
Cloud ERP model – either public or private
Training services from the ERP partner
Access to online help and training resources
What we’ve provided here is a shortlist of features to consider. Your requirements will come down to the type of business you run, what your processes look like and the goals you have for your ERP project. To get the most out of this exercise, download the full checklist at the link below. You’ll get an editable file so you can just tick the boxes for the features you want and use the document as a reference for your project team.
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