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The ins and outs of an ERP assessment

INSIGHT ARTICLE

An effective enterprise resource planning (ERP) system can give retailers a 360 degree view of their customers, inventory, sales, marketing, orders, supply chain, stores and channel operations. That view ultimately lets a retailer drive revenue and make better decisions. But, how do you know if your systems are up to speed? You’ll need to perform an ERP assessment.

That ERP assessment can be done with the help of the retailer’s internal IT staff, their ISV, or through a third party, such as a solution provider. Such an evaluation will ensure not only that retailers will have the type of multi-channel ERP functionality required to promote a new level of customer engagement and an enterprise-wide emphasis on promoting better connections with customers, but also that the best financial return is achieved at the same time.

A typical ERP assessment should provide a complete picture of operations, from merchandise planning, accounting and reporting, sales and marketing, and sales supply chain to store, channel and fulfillment operations. It will also drill down with an analysis by product, channels (including catalog, corporate and affiliate websites), stores, direct mail and geography. The analysis will evaluate the assets and infrastructure, as well as the people, process and technology involved in each touchpoint in the customer experience.

The assessment will take in the retailer’s current operational strategies, technology assets and business processes, and identify opportunities for cost reduction, margin improvement and risk reduction. Post assessment, the retailer will have a road map showing areas for potential improvement through planning, service and quality, aligned with organizational strategy and goals.

It is important to remember that an ERP system will only perform at its highest level when a retailer has the appropriate standardized and efficient processes in place. An ERP assessment should provide an implementation road map and process improvement concepts, along with a view of how the proposed technology will impact other areas of the organization.

That may seem like an enormous and costly consulting project, but it’s not. It’s one that can be done in weeks, not months and will serve as an invaluable tool to use in maximizing the performance of an ERP system while laying the foundation to fully exploit these new technologies that promise a consistent and satisfying multichannel experience for customers.

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