ERP Best Practices - Best for Who?
You’ve probably heard the term “best practices” used to describe a specific standard by which a business should run its operations. The term suggests that there is one “best” way to tackle operational processes and tasks within an organization. However, have you thought about exactly who these “best practices” are best for? When it comes to ERP software solutions, are “best practices” what’s best for your company or what’s best for the ERP software provider?
For general operational tasks, the best solution is to leverage the ERP best practices standards. It’s not necessary to reinvent the wheel for processes that will not elicit visible improvement. ERP processes used for accounts payable and general ledger, for example, are fully optimized processes. They’re not broken, so you don’t have to fix them.
For other tasks, however, your company can benefit from deviating from a “best practices” framework because they may not be best for your specific business. For example, if you and your competitors are conducting your respective businesses according to ERP best practices across the board, you’re stifling your business’ potential. In order to stay competitive as a business, it’s important to encourage innovation and to compete strategically.
The problem with “best practices” for ERP systems is that they are defined by software vendor best practices for their software, rather than for your specific business. Following the best practice standards can even cost your company a significant amount of money if they are followed blindly. Let’s say, for example, your shipping company discovers that the most efficient way to handle shipping is to print labels for orders, sort according to those labels, and load shipments into the carrier.
Unfortunately, the ERP software you implemented only follows ERP best practices and can’t adjust to a process that is best for your business. In this case, your company has limited their options to a costly warehouse reconfiguration that adjusts to software best practices, or a costly and time-consuming software customization that adjusts to the client’s best practices.
The thing to take away from this example is that ERP best practices are guidelines for how your business should be run, not rule books. Businesses should define what is best for their success, instead of being defined by an oftentimes arbitrary set of “best practice” standards. To prevent an ERP implementation failure, it is important that proper research is conducted and that you make decisions that are best for the company by your own standards instead of a general set of best practices.
Need more information on ERP? Learn more about the subject on our comprehensive ERP software comparison report, where we stack up 20 of the best ERP platforms on the market currently.
[Photo courtesy of WIPFLi CAPAs and Consultants.]