Technology Evaluation Centers will be launching a buyer’s guide for enterprise resource planning (ERP) solutions for small businesses. Here’s a preview of the guide describing the idea behind it and what it can do for you.

Why an ERP Buyer’s Guide for Small Businesses?

My experience as a trainer and consultant in ERP showed that most small businesses have a very subjective, therefore inefficient manner of selecting ERP software. The selection process is based on one or more of the following “criteria”:
• A local vendor is offering a solution, which is adapted to the customer’s industry, therefore this is seen as the best option available
• The owner, president, or a decision maker knows someone who uses the system, and is very happy with it. This makes it a very good choice (and sometimes the only one).
• The salesman from one vendor offers special pricing and promises future product development. The product manager presenting the demo is convincing enough to make a potential customer look no further.

Small businesses cannot afford to allocate time and resources for complex ERP selection projects, but this does not mean that there should be no project at all. A successful small business will eventually grow and the potential ERP system selected is an essential tool to insure its future success.

What is a Small Business?

We had to come up with a definition of a small business that can be applied to any industry and any region of the world. The definition of a small business being so different in North America, Europe and other continents, we decided to use the following:
• Micro businesses: 1 to 20 employees, with revenues under $5 million;
• Small businesses: 20 to 200 employees, with revenues from $5 to 50 million;
• Small to medium businesses: 200 to 500 employees, with revenues of $50 million and over.

Does a Small Business Really Need ERP?

In order to help small businesses decide whether they really need ERP or not, we created a 10 question quiz that will help you come to this conclusion.

If you realize that you do need an ERP system, then you should know what the options are. We described on-premise versus software-as-a-service (SaaS) and on-demand, proprietary versus open source software, and provided a comparison between old and new technology.

Finally, we describe the main challenges small businesses may face when selecting an ERP system.

What About the Vendors?

The second part of the buyer’s guide is for vendors. It begins with a matrix showing the level of support for the following functionality: inventory, manufacturing, sales, purchasing, financials, and payroll.

There are also case studies and a list of more than 50 vendors—with their contact information— at the end of the guide. Please follow our Newsletter to be one of the first to read ERP for Small Businesses Buyer’s Guide.