When manufacturing and distribution companies decide to look for a new ERP business system this is a very common selection pattern.

Diligent ERP system vendors will begin with trying to understand business processes, look at your technical infrastructure, go through the selection process and the winning team will submit a business case study and proposal. So why is a client company that follows this approach in real danger of ERP failure?
The answer is simple. The first step is missing. 
Companies today are bombarded with messages about “digital transformation,” and blinded by newer technologies like machine learning and Artificial Intelligence. But many enterprises have the selection process backwards.
They spend the bulk of their time trying to find and select just the right business system with all the latest bells and whistles and then trying to make it work when they should be spending the bulk of that effort on better understanding their business, setting real goals and only then selecting a system to meet those requirements. It sets up an enterprise for failure.

How Successful Companies Do It 

Successful businesses have one thing in common-they focus relentlessly on business outcomes and then launch technology initiatives that directly support corporate goals.
What is your company trying to achieve?

• • Improve free cash flow?
  • Shorter order to cash cycles?
  • Improved margins?
  • Stronger CAGR?
  • Higher customer satisfaction?
  • Fewer returns?

etc.

The answer will be different for every business and it will change over time but the key here is that smart executives put their focus on the business of the business and then find the best technology to support those goals, instead of trying to shoehorn the business into technology that may or may not be right for your company,

Understanding Business Goals Isn’t Easy

Let’s face it, if it were easy, every company would be doing it. Unfortunately, many times executives are so busy down in the trenches trying to make sure everything works properly nobody is focused on the actual business.
There are many companies we have walked into where the extent of its business goals is just a vaguely worded mission statement on the wall. We have had many conversations with senior executives at companies anxious to invest hundreds of thousands of dollars in a new ERP system but they are unable to articulate what business issues they hope to solve to meet the company’s growth requirements.
I recently had a conversation with the CEO of a manufacturing company whose first statement was, “I only want to look at cloud ERP systems” and as we talked further it became obvious he had no clearly thought-out business goals beyond “doubling revenue” and unifying all his data into one system.
Let’s be honest, if there are not clearly laid out business goals, that’s not a plan, that’s an aspiration and in the case of this CEO, he is heading down a road filled with frustration and potential failure.

Start With The End in Mind
Before you begin your search for a new ERP business system take a page from the most successful companies and take the time to do a deep dive inside your business. Develop real goals to achieve, with timelines, resources and  the necessary components to make it happen. 
Once you have those business insights, you’ll have a much better understanding of the technology and team you need to achieve real success and continue down your path to true digital transformation.