Cost Estimate and Accounting in ERP
February 12, 2025
Most Americans earn their income in the form of wages rather than in the form of investment income from shares, bonds or real estate. It is therefore important for the people of America that the wages keep increasing in proportion to productivity. However, this has not been the case. The average American worker has stagnant […]
The price of drugs is going through the roof in America. This is also the case in many developing nations. In general, people are simply unable to afford healthcare if they do not have insurance. In developing nations, having insurance is not the norm. Hence, when patients are faced with high medical bills, some of […]
The Persistence of the Digital Divide The advent of the internet revolution raised hopes that there would be an egalitarian society where free sharing of information and knowledge would eliminate the uncertainties and the power of gatekeepers of knowledge by making it free and easy to search and find. Further, there were hopes that the […]
The production system design planning considers input requirements, conversion process and output. After considering the forecast and long-term planning organization should undertake capacity planning. Capacity is defined as the ability to achieve, store or produce. For an organization, capacity would be the ability of a given system to produce output within the specific time period. […]
Why India is in The Eye of Perfect Storm With Regards to the Jobs Crises By now, there is a consensus among all experts and other stakeholders that India is in the midst of a severe Jobs Crisis brought about due to several converging and intersecting trends. With Unemployment at a 45 Year High and […]
Evaluation and selection of ERP package is an essential criterion for successful ERP implementation. Quality of selection will have a long term impact on the processes of the organization. It is also not easy to switch to another product with concomitant scale of investment and complexities. This evaluation and selection process should be properly directed and normally comprises of following activities:
Formation of an evaluation committee: An ERP implementation is not an IT project but a business oriented development. Therefore, in addition to Chief Information Officer, this committee should comprise of all functional heads and driven by a top management representative. Since all business functions are represented in selection process, the chosen package would have wide acceptance subsequently.
Requirement Analysis: This analysis should outline functional expectations of various business divisions, such as warehouse, finance, procurement, from potential ERP package. Vital requirements specific to the company should be highlighted e.g.
Requirement analysis forms a base for preparing a Request for Proposal (RFP), where important technical and commercial perquisites are incorporated. Common examples of technical perquisites: flexibility, Upgradability, User friendliness, field level security, Operating system and database compatibility. Common examples of commercial perquisites: cost, reference sites, high level project plan, resumes of consultants, post implementation support, financial health of the company, local presence, number of installation and upgrade.
Selection Criteria: A pre-determined selection Criteria should be ready before actual selection process commences. Selection criteria are normally in the form of questionnaire and point system, where each question represents a business or technical need. Weightage for each point or a group of points are predetermined which varies according to criticality of the issue. These processes help in making the selection process objective and transparent.
Selection Process: Selection process constitutes various stages as mentioned below:
The most important point of selection process is that it should be based on a consensus and have maximum buy in as an ERP system belongs to all functions and departments. Another important issue is that over expression of requirement during requirement planning should be avoided as this will lead to incurring unnecessary expenditure.
Your email address will not be published. Required fields are marked *