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Archive for the ‘Software Evaluation’ Category

Cloud Based ERP vs. Web-Based ERP – What’s the Difference?

Tuesday, May 9th, 2017 by Alex Smith

During the ERP selection process, we are asked by nearly every potential new customer if Enterprise 21 ERP is a cloud-based ERP system. When we tell our potential new customers that Enterprise 21 ERP can be accessed from anywhere in the world with an Internet connection, businesses immediately assume that Enterprise 21 ERP is a cloud-based system and that they do not have the ability to have the system installed on their own hardware and infrastructure should they desire to do so. These businesses, however, are incorrect. With Enterprise 21 ERP, businesses can choose whether or not they wish to have the system installed on their own hardware and infrastructure or installed in a data center in which the infrastructure to support the ERP system is managed for them by a third-party. Read More…

Enterprise 21 ERP is a web-based ERP system, not a cloud-based ERP system. What is the difference?

What is a cloud-based ERP?

A cloud-based ERP system, at least by our definition, is an ERP solution in which the business pays a per user, per month fee for hardware and software – it is effectively a lease on hardware and software. The software system and database reside on the software vendor’s (or some third-party’s) infrastructure, and the software system is typically accessed from within a web browser. A cloud-based ERP system’s licensing model is usually subscription-based and does not provide for software ownership (although there are exceptions to this general rule). Please click here for a great definition of “cloud-based.”

What is a web-based ERP?

A web-based ERP system, on the other hand, is simply an ERP solution that is delivered over the Internet, and the system is accessed within a web browser. The web application and database may be located on-premise at the company’s facility, or it may reside in a third-party data center. A web-based ERP system may be sold to a business under a traditional software licensing model (per named user, per concurrent user, per module, etc.), or it may be sold under a cloud-based, subscription model. Please click here for a great definition of “web-based.”

With Enterprise 21 ERP, there is no subscription licensing model available; rather, Enterprise 21 ERP is a web-based ERP application that is sold on a concurrent user basis as an integrated whole. Our customers, then, have three options at their disposal: 1) purchase software licenses and have the system and database deployed on their own hardware and infrastructure; 2) purchase software licenses and utilize TGI’s hosting services to host the application and database for them for an additional per user, per month fee; and 3) purchase software licenses and contract with any third-party hosting provider they are comfortable working with.

The keys are that in any of the three options noted above, our customers do not need to pay a recurring licensing fee, have 100% flexibility and control over where their data resides, and can access 100% of their business data in real-time from anywhere in the world with an Internet connection.


ERP Selection Etiquette When Requesting Vendor References

Thursday, January 24th, 2013 by admin

Customer reference calls and a site visit to see an ERP vendor’s customer using a proposed ERP solution in a real-world environment is a logical and essential step in the ERP selection process. That said, organizations that are evaluating distribution and manufacturing software solutions need to consider when in the overall selection process to ask the ERP vendor for such references. It is important to remember that it is not the ERP vendor’s customers’ job to “sell” the selection team on the system, and it is extremely unlikely that an ERP vendor will put the selection team in touch with an unhappy customer. In other words, customer reference calls should be used to affirm the ERP selection team’s vendor of choice and to get unbiased insight about the implementation process, lessons learned, support experiences, etc.; the selection should not simply rely on customer reference calls as a means to differentiate one vendor from another in an effort to tip the scales in one vendor’s favor. Read More…

Guidelines For Requesting ERP Vendor References

Following these three simple guidelines will not only help an ERP selection team find the best possible ERP system for their respective business, they will help the selection team make the most effective and efficient use of its and the ERP vendor’s customer’s time.

1. Complete the Majority of the ERP Selection Process First

Complete the vast majority of the ERP selection projects first, including remote demonstrations, an RFI, an RFP, discovery visits, and onsite scripted software demonstrations, before moving into customer reference calls and a site visit.

ERP selection teams should make every effort to complete other phases of the selection project before worrying too much about speaking to an ERP vendor’s existing customers. Selection teams should conduct a thorough, quantitative assessment of each potential ERP vendor and solution through distributing RFI’s and RFP’s, participating in initial web demonstrations with potential vendors, and bringing a short-list of vendors in to perform a site discovery visit followed shortly thereafter by a day-long, scripted software demonstration. Through distribution of an RFI and RFP, a perfectly logical request would be for the software vendor to provide some sample customer names who are in a similar industry and/or who have similar internal processes and software requirements. Through onsite, scripted software demonstrations, the ERP selection team should be able to narrow their short list of potential vendors and solutions down to one (or two at the very most) preferred vendor of choice. Done right, the scripted software demonstration process should provide the selection team with a clear-cut, quantitative ranking of the various software vendors and ERP solutions being evaluated.

Requesting customer references with only the preferred vendor or top two vendors will minimize the number of reference calls made by the selection team and prevent the team from calling customers of ERP vendors who have already been eliminated from the evaluation project due to functional fit.

2. Avoid Cold-calling

Allow the ERP company to arrange dates and times for customer reference calls based on their customers’ and the selection team’s availability.

Following scripted software demonstrations and identification of the preferred ERP software vendor, the selection team should request the vendor to arrange dates and times with three of its customers who are similar in size, industry, and functional requirements. The selection team should also request the vendor to arrange the calls with customer contacts who have an intimate knowledge of the proposed ERP solution and vendor, the software selection process that was used when evaluating the vendor, and who will be able to discuss his or her experiences with the ERP software implementation process and working with the software vendor.

Calling ERP vendors’ customers without having the vendor first arrange the date and time of the call with the right contact will prove to be largely ineffective. Not only does the selection team run the risk of a given customer contact not being available, it risks speaking to somebody who may not be able to answer the full scope of the selection team’s questions relating to the ERP vendor, the software, the selection process, and/or the implementation process.

3. Include the Software Selection Team on Reference Calls

The ERP selection process is a team effort; customer reference calls are a team effort.

When it comes time for the actual reference calls to take place, it is important to have the same individuals from the selection team on all of the reference calls. Too often, organizations tend to give the responsibility of reference calls to whomever from the ERP selection team is available. The problem with this approach is that it opens the door for questions to be asked differently and the potential to have one individual from the selection team experience a great reference call and a different individual from the selection team experience a mediocre reference call. This situation could ultimately lead to inconsistencies in the selection team’s view of who the right vendor is. By utilizing the same resources for all reference calls, the selection team will be able to ensure that its reference call process was objective, standardized, and consistent.

Customer reference calls are, without doubt, essential elements to the overall evaluation process. It is important, however, for the selection team to make the most effective use of its time to keep the selection process moving forward and request customer reference call arrangements to be made at the most logical time in the process.


ERP Selection: Comparing Enterprise 21 ERP to the Competition

Tuesday, May 29th, 2012 by admin

A common question asked during the ERP evaluation process is, “How does your ERP system compare to other ERP solutions on the market?” The problem with such a question, unfortunately, is that it is typically being posed to a sales person representing a specific ERP application, making it virtually impossible for the person evaluating the ERP system to get a truly objective, unbiased response. Read More…

One of our primary business objectives at TGI is to encourage our new business prospects to compare TGI and our Enterprise 21 ERP system to our competition through a quantitative ERP selection process. We do not believe in “selling” software in the traditional sense of the word; rather, we believe in demonstrating Enterprise 21 ERP and being straightforward about what its functional capabilities are. In many cases, this means we have a strong functional fit for a given business. In other cases, however, we may not be the best fit, in which case it is better for both TGI and the prospect to part ways. No ERP software solution can be everything to everybody.

Over the years, we have attempted to provide the necessary tools to allow companies to select the ERP vendor and solution that has the best functional and organizational fit for their respective businesses. One example of this is our free ERP Software Selection Tool Kit, which has been downloaded by thousands of organizations and used to evaluate potential ERP, distribution, and manufacturing software systems.

In continuing with this approach, we are pleased to announce that businesses interested in evaluating Enterprise 21 ERP can obtain a free ERP comparison report based on user-defined functional criteria using Technology Evaluation Centers’ (TEC) online ERP comparison tool. Users may select up to three additional ERP vendors, enter their requirements, and get an immediate, detailed report comparing Enterprise 21 to the other selected ERP solutions.


Successful ERP Implementation Starts with Successful ERP Software Evaluation

Friday, March 25th, 2011 by admin

Implementing an ERP software system represents both a significant technological and cultural change for any manufacturing or distribution organization. An ERP system changes the very nature of individuals’ jobs, roles, and responsibilities within the company. Unfortunately, the ERP industry is wrought with failed implementations or terrible stories of companies not being able to take orders, receive product, or ship orders to customers upon go-live. Read More…

Generally speaking, implementations fail for two reasons. First, the manufacturing or distribution organization’s internal ERP implementation project team was simply not committed to executing the necessary tasks to complete the software implementation in a timely fashion. Similarly, the ERP vendor was not able to deliver what it promised during the sales process or was not equally committed to completing the implementation successfully.

Secondly, and perhaps more commonly, ERP implementations fail because the organization did not select the right ERP solution and vendor in the first place. Successful ERP implementation projects do not begin with signing contracts and paying a software vendor money for software licenses; rather, successful ERP implementation projects begin with a well-structured, quantitative ERP software evaluation process that looks in-depth at each ERP system’s complete set of functional capabilities and how such functionality translates to tangible benefits and potential ROI for the manufacturer or distributor. To a degree, “selecting” an ERP system is different than “buying” an ERP system.

At TGI, we encourage each of our potential new business prospects to evaluate TGI and Enterprise 21 ERP through a thorough, quantitative ERP selection process, and we offer free ERP software selection tools to assist in this process. Depending on the nature of the industry the prospect is in, the prospect’s software requirements across various business departments and units (accounting, order entry, inventory and warehousing, purchasing, manufacturing, etc.) expected software implementation time frame, budget constraints, and countless other factors, we are often times a great fit for the prospect. Other times, however, we may not have the most viable solution for a particular business. The point is that through a thorough ERP software evaluation process, strengths and weaknesses of each software vendor and solution can be identified, allowing organizations to select the best possible ERP solution for their respective businesses while simultaneously providing a stepping stone for organizations to complete their ERP implementation projects successfully.


When Should I Replace My Existing ERP Software?

Tuesday, July 6th, 2010 by admin

Let’s examine when it’s time to consider kicking off an ERP selection project replacing your existing manufacturing or distribution ERP software. There can be a number of symptoms that will help point someone to realize it’s time to evaluate and implement new ERP software. Here are some examples. Read More…

  • Current software can’t match existing business processes – this may have existed from day 1 of installing your new software if you did a poor job of selecting software the first time, and the gap may have continued to widen over time.
  • The business is changing and software can’t enable this change – as a business changes and grows, new processes can get introduced which help enable that business to be competitive in new markets with new customers.
  • Lots of off-line processing (i.e., spreadsheets, manual processes, re-keying of data multiple times) – if the existing system doesn’t allow someone to get their job done, they will tend to find ways around the system to do so. Unfortunately, these inefficiencies can eat substantial amounts of time and can create data inaccuracies as the “same” information is entered multiple times in disparate systems.
  • Have lots of “data” but can’t get “information” out of the system – analyzing information is critical to continuous improvement and attracting and maintaining good customer relationships. One can get handcuffed by having a data rich, information poor environment where they put data into their system but can’t get any information back out.
  • Can’t easily implement new functionality or technology (i.e., RF/barcode, EDI, warehouse management system, CRM software, etc.) – there may be improved efficiencies to be gained and new customers attracted by making it easy for them to do business with you. Many times, technology is a key enabler to making it easy for your customers to interact and transact business with you.  If you can’t readily adopt these new technologies, you may lose customers who are better prepared to transact business with your customers.
  • Existing software and/or underlying infrastructure is no longer supported by the associated vendors – as there have been massive amounts of acquisitions in the ERP market over the years, there are lots of ERP solutions which were thought of as “flagship” solutions that are no longer receiving an adequate level of investment to keep existing customers satisfied and to attract new ones. Your vendor may have “dropped support” for your software without formally announcing it to you.
  • Can’t keep up with business demands by writing custom software vs. using packaged software solutions – for those who continue to write their own custom software, there are so many “commodity” processes that could be enabled via packaged software while still gaining the benefits of customized software in those “competitive advantage” processes – those processes that enable a company to gain competitive advantage in its marketplace. Unfortunately, most companies who have a “build” vs. “buy” approach to software do so across all business processes, and either pay a lot for “commodity” processes or can’t get resources focused on the “competitive advantage” processes due to keeping day-to-day operations running.  Don’t allow yourself to be held hostage by your internal application development team.

While the above is not intended to be an all inclusive list, these symptoms are very common in businesses.  As symptoms continue to pop up and their results become increasingly more disconcerting, manufacturing and distribution businesses will opt to evaluate and implement new ERP software solutions to remove these barriers to future business growth.


Download the Latest TGI ERP White Paper from the TGI Resources Library

Wednesday, June 30th, 2010 by Alex Smith

We recently published a new white paper in the TGI Resources Library. TGI’s Extending CRM Concepts in ERP Systems white paper discusses the necessary software features an ERP system must deliver to go beyond basic contact management and extend CRM concepts throughout the enterprise. By selecting an ERP software solution that is capable of meeting such criteria, manufacturers and distributors alike will be able to arm themselves with a set of software functionality to improve customer service and satisfaction and meet individual customer’s requirements on an on-going basis.

Click here to download the complete white paper from the TGI Resources Library.


ERP Selection and TGI’s No Maintenance Fee Increase Guarantee

Thursday, April 15th, 2010 by Alex Smith

In addition to functional requirements, there are a number of cost-related questions to ask potential software vendors during the ERP selection process, such as: Read More…

1. What is the cost of software licenses? Are software licenses sold on a named user or concurrent user basis?
2. What is your average implementation services-to-software cost ratio?
3. Is the software sold on a module-by-module basis, or is it sold as an all-inclusive ERP software product?

A few important questions that are often missed or overlooked during the ERP selection process, however, are:

4. When do you start to charge new customers for annual maintenance?
5. What is your annual maintenance fee, and how is this maintenance fee calculated?
6. What was your annual maintenance fee five years ago?
7. Are software upgrades and future software releases included in your annual maintenance fee?

Questions 4-7 are crucial to the selection process because they can serve as a basis for the selection team to determine not only the most cost-effective short-term ERP solution but the most cost-effective long-term ERP software solution as well. The selection team must have a reasonable understanding of the future costs associated with purchasing the ERP product for the years following ERP implementation.

At TGI, we offer one year of free ERP maintenance from the date of software installation. Given that an ERP implementation may take between three and nine months to complete, we believe our customers should not have to pay maintenance on a software product when they are not using the software in a live transaction environment.

Perhaps more importantly, TGI provides a No Maintenance Fee Increase Guarantee.  We guarantee, in contract writing, that we will never increase the annual maintenance fees charged to each of our customers. This guarantee is designed to provide our customers with a consistent, expected yearly software maintenance expenditure that is free from unanticipated increased fees associated with their software maintenance agreement. We are very proud of the fact that we have never increased our customers’ annual maintenance fees since TGI was founded in 1990.

Why is this guarantee important?

Referring to questions 5 and 6 above, should there be a difference in the maintenance fees an ERP vendor charges its customer today versus five years ago, and the vendor does not provide price protection on their software maintenance agreement, a manufacturing or distribution organization may be subject to escalated software maintenance fees over time. The end result of these unexpected maintenance fee increases could mean that the organization will be forced to allocate funds to their annual software budget that would have otherwise been used for investment in other potential business endeavors.

At TGI, we believe increasing our customers’ annual maintenance fees over time is not the right way to establish long-term partnerships with our customers. As such, we have not and will not increase the maintenance fees we charge our customers over any period of time. Guaranteed.

For a complete listing of questions to ask potential ERP vendors, click here to download TGI’s “50 Questions for Every ERP Software Suppler” white paper.


ERP Software Evaluation: What Customers Want from ERP Software and What ERP Vendors Want

Tuesday, March 9th, 2010 by admin

Let’s examine what most customers want from new ERP software and what most ERP vendors want from an ERP selection and implementation.  While there are many layers to the topic of what customers want from new ERP software, the core answer of what businesses want from new ERP software is business results – business owners want to reduce costs, increase revenue, improve operational efficiencies, and make it easier for their customers to do business with them. Read More…

Beyond business results, companies also want the following from new ERP software:

  • Efficient software evaluation leading to a successful result – companies want to make excellent decisions in the most efficient manner possible (unfortunately, when businesses aren’t aware of how this process should work, it rapidly becomes very inefficient).
  • Efficient, successful implementation – companies want their new software to deliver the functionality they expect and for the implementation process to be delivered on-time, on-budget, and on-scope.
  • Good long-term customer/vendor relationship (“win-win”) – companies want to be able to work with their ERP vendor, have continuity of the software vendor’s business, continuity of relationships with personnel at that business, and be able to understand how best to utilize their software and to resolve issues as they arise.
  • Ability to grow with the solution – companies want a solution that will last them for an extended period of time, in many cases this is 10-15 years or more.  To be able to do this, the software must be flexible, robust, and have sufficient functionality to be able to be leveraged as the customer’s business continues to grow and evolve.

So, what do ERP vendors want?  Probably not surprising, they likewise want business results.

Additionally, ERP vendors also want the same things the customers want:

  • Efficient software evaluation leading to a successful result – while ERP vendors would love to bat 1.000 by winning every deal they touch, they know that’s not practical.  They want to compete in deals in an efficient manner where they can compete on a level playing field, can win, and it is worthwhile to win.
  • Efficient, successful implementation – vendors want their customers to receive the business benefits they desire from their software and want the implementations to be delivered on-time, on-budget, and on-scope.
  • Good long-term customer/vendor relationship (“win-win”) – vendors want to work with customers who are easy and fair to work with, have continuity of the customer’s business, continuity of relationships of personnel, and are able to understand and internalize how best to use the software they’ve acquired.
  • Ability to grow with the solution – vendors want customers to continue to leverage more and more of their software’s capabilities over time.

While said somewhat under the covers above, I’ll also explicitly state the following which ERP vendors also want:

  • Efficient sales cycles (winnable deals, no “tire kickers”) – again, vendors want to focus their time on evaluations where decisions will be made and customers will move forward.  There is no time to be spent with perennial prospects that go through the same evaluation once a year and never decide to move forward to do anything. Additionally, vendors don’t want to be in a position where a potential new customer has orally committed they are going to move forward with the vendor only to take an inordinate amount of time to make the final commitment and sign contracts.
  • Happy, referencable customers – there is nothing better from a vendor’s perspective than having happy customers who are willing and able to act as references on their behalf.

You’ll note that to this point in time I’ve mentioned these things apply to most customers and most ERP software vendors.  That is because there are still people, including those who set the cultural tones of their businesses, who believe the only way for them to “win” is if the other party with whom they’re working is to “lose.”  This “win-lose” mentality unfortunately still exists frequently in the customer/ERP vendor intersection.

Speaking from an ERP software vendor’s perspective, when it is determined that a potential customer is focused on establishing a “win-lose” relationship, we walk away from those deals as rapidly as possible.  Likewise, if potential customers determine that an ERP vendor is attempting to establish a “win-lose” relationship, those customers need to eliminate that vendor from further consideration as rapidly as possible.

The most prevalent situation in which ERP vendors attempt to establish a “win-lose” relationship is where the functional and cultural fit between the vendor and potential customer is low, and the vendor is so hungry for new sales (i.e., business results are far more important than any of the other desires) that they continue to press on to close the sale.  In doing so, the ERP vendor knows the implementation is going to hit the rocks, but their objective is to get the customer so deeply invested in the project (both time and money) that they cannot turn back.

Those who are unfamiliar with how to structure and perform an ERP Software Evaluation are most highly susceptible to be bitten by a vendor attempting a “win-lose” transaction.  In cases in which the company is unfamiliar and inexperienced in orchestrating a software evaluation on its own, those companies are highly encouraged to find and engage experienced, independent assistance to help with the evaluation.

Here again I want to stress that the most critical word in this statement is “independent.”  There are tons of individuals and businesses that tout themselves as independent.  However, they may be software resellers in a consultant’s clothing or have biases to specific products because they have established implementation practices built around those solutions.

If, for whatever reason, hiring an independent consultant is not feasible, companies are encouraged to adopt a structured, analytical process they can follow on their own.  To help companies establish and manage a structured, analytical evaluation process, TGI offers free software selection tools via our Web site for the do-it-yourself software evaluation.

In closing, through this point in time, I’ve had the opportunity to work with well over 2,000 end companies and roughly 200+ independent consultants in ERP software evaluations since Q4/2003. During that time, I’ve seen some firms and individuals who were very good at performing their roles in their respective evaluation processes, while others were at best ill-prepared. In the end, when participants in the process are unable to successfully play their positions – whether intentional or unintentional – nobody wins.

In an effort to draw upon these experiences to help the various stakeholders of the process learn from these activities, I wanted to summarize those situations into a single statement. In doing so, I was drawn to a famous quote by noted Swiss Psychiatrist and founder of analytical psychology, Carl G. Jung, who said, “The world will ask you who you are, and if you do not know, the world will tell you.”

Here is what I call “Litzenberg’s ERP Software Corollary to Carl Jung’s Statement”…

“The world will ask you what you want in new ERP software, and if you do not know, you’ll likely be sold something you don’t really want, can’t really use, will spend a lot of time, effort, and money trying to get it to do something it was never intended to do, and ultimately, won’t achieve the desired results.”


New ERP White Paper: Five Critical Software Requirements for Improved Product Safety and Traceability

Thursday, February 25th, 2010 by Alex Smith

We just released a new white paper in the TGI Resources Library, Five Critical Software Requirements for Improved Product Safety and Traceability. Given the rise of increasingly stringent FDA and USDA regulatory requirements, companies in the food, beverage, chemical, and pharmaceutical industries are being forced to change their internal business processes and leverage new technology to help them meet evolving industry compliance requirements for product safety and lot traceability. TGI’s Five Critical Software Requirements for Improved Product Safety and Traceability white paper details the necessary ERP software features and functions required for organizations to ensure the highest levels of product safety while simultaneously gaining real-time access to ingredient and finished good lot information. To download the white paper from the TGI Resources Library, please click here.


ERP Selection: The Importance of a Quantitative ERP Software Selection Process

Tuesday, February 2nd, 2010 by Alex Smith

The ERP selection process is one of the most important activities in which an organization engages. Selecting an ERP system represents a technological and business process transformation for the organization; therefore, it is imperative that the organization conduct a thorough, quantitative analysis of various ERP software companies and solutions. In doing so, the business’s software selection team can gain a true “apples to apples” comparison of each software solution and determine which solution offers the best functional fit for the organization. Read More…

To help manufacturers and distributors in this process, TGI’s Software Selection Tool Kit offers, among other resources, software demonstration script templates and grading sheets to be used for onsite ERP software demonstrations. The selection team can use these templates to develop a software demonstration script that reflects the key software requirements of the organization. The selection team would then distribute these scripts to a select group (usually 2 or 3) of vendors with sample data (products, parts, ingredients, vendors, customers, etc.). The software vendors, in turn, would use the supplied sample data to follow the demonstration script prepared by the selection team. Using the software demonstration grading sheets contained in TGI’s Software Selection Tool Kit, the selection team can score how each vendor performed for each task in the demonstration script. Following the final onsite software demonstration, the selection team can compile scores for each ERP software vendor and see, quantitatively, how each software solution compared to the other demonstrated software solutions. The end result of this process will be a software vendor and solution that outscored and outperformed the other software solutions that were demonstrated.

By requiring software vendors to follow a demonstration script that reflects the organization’s key software requirements, the selection team will be able to see first hand how each vendor can meet those requirements. This process also prevents the software vendor from shying away from a specific software requirement that it knows it won’t be able to meet and ensures that each software vendor was evaluated in a consistent manner.

To download TGI’s onsite software demonstration templates and grading sheets, please click here.