How do you choose the right implementation partner(s) for your ERP program?

 

ERP programs are often considered one of the largest investments for organizations and are associated with operational and financial risk, and are also a driver for change from many perspectives.

That is why it is essential to form a solid strategy for sourcing an ERP implementation partner early on. Considering, for instance, make versus buy strategy, pricing model, sourcing objects, supplier capacity, and capabilities to engage the right partner(s) in a timely manner and to help deliver on the transformation objectives.

 

Forming an ERP Implementation Partner Sourcing Strategy that fits your organization

Forming the ERP Implementation partner sourcing strategy will likely be a collaborative exercise where companies often find themselves considering the same questions more than once. We at Opticos recommend formulating and agreeing on a few Strategic Drivers to form a solid foundation – as a starting point. These drivers or business values will then provide guidance in the detailing of the strategy and act as a basis for making the right decisions for your organization.

These areas are generally part of an ERP Implementation Partner Sourcing Strategy:

• Strategic drivers or business value
• Sourcing direction (sourcing objects, supplier selection, make or buy)
• Governance
• Commercial engagement model

 

When detailing a sourcing strategy, you are advised to consider a few critical and strategic areas and questions:

Illustration 1 – ERP sourcing strategy – key areas to consider

 

The answers to these questions, and hence the sourcing strategy, will vary depending on your organization’s existing capabilities, value drivers, and relationships with existing and preferred vendors.

The Sourcing Process
When the first version of the strategy is set, it is time for the actual selection of partner(s). We recommend qualifying the supplier’s capabilities through a collaborative sourcing process (as opposed to a traditional RFP) to develop requirements, ways of working, and validation of the cultural fit for the organization. The process will also help form a better understanding of what capabilities need to be developed in-house or purchased from external suppliers.

While the strategy will not solve all problems, it will keep organizations on the right track when making important decisions. Please remember that the strategy should be seen as a living document and might have to evolve over time!

To summarize, at Opticos, we strongly believe in considering the following recommendations to boost your journey toward finding the right partners:

 

• Set the sourcing strategy early and then let it evolve over time.
• Qualify the supplier’s capabilities through a collaborative sourcing process (as opposed to a traditional RFP) to develop requirements, ways of working, and validation of the cultural fit for the organization.
• Define and select strategic capabilities to retain and develop within your organization. This will support in validating what to source externally and achieve overall transformation objectives.
• Establish a solid governance structure, and engage the sponsor to allow seamless integration and clarity on roles and responsibilities across the internal organization and engaged partner(s).

It is common to have a long road to finding the right partners. Considering these recommendations might save you a bumpy ride.

 

Want to know more? Don’t hesitate to contact Opticos experienced sourcing professionals!

 

Opticos Offerings:

Sourcing and Procurement – Opticos have a strong Sourcing and Procurement capability and a proven record of supporting clients from strategy to agreement.

Digital Transformation – Our journey does not stop when the agreement is signed! Opticos also holds comprehensive knowledge and experience from supporting clients in ERP implementations and digital transformation; we provide experienced consultants supporting on the “client-side” with, for instance, project and change management.

Linnea Håkansson & Rickard Holmkvist