Why ERP Selection Matters More Than Ever
In 2025, businesses worldwide are under immense pressure to digitize, streamline operations, and remain competitive. Global supply chain instability, inflation, compliance complexity, and rising customer expectations have made digital transformation a strategic priority.
At the core of that transformation? Enterprise Resource Planning (ERP) software. ERP systems integrate core business functions—finance, procurement, HR, inventory, operations, and customer data—into a single platform. The right ERP system unlocks agility, control, and growth. But the wrong ERP system? It drains time, budget, and morale.
The Biggest ERP Selection Challenges Facing Organizations
- Skipping the Strategic RFP Process
Too many organizations jump straight into demos or choose solutions based on supplier reputation or what other companies in their industry have implemented, not their actual requirements. A strong planning process including clearly defining your requirements, market research and an RFP process ensures alignment between business strategy and system capabilities. Fail to plan, plan to fail.
- Misalignment Between Business and IT
ERP is not just an IT initiative. When Operations, Finance, Procurement, and HR are not deeply involved in planning, defining the requirements and evaluating the supplier proposals, the selected solution won’t solve real business problems. They stakeholders must be engaged at the outset to truly get the right solution that supports your business today and can scale for the future.
- Failing to Evaluate Global Capability
In multinational organizations, ERP must support multiple currencies, tax jurisdictions, languages, and data residency rules. Many systems fall short of these global standards. While you may not be operating in multiple countries today, what is your long-term plan for growth and expansion? Setting yourself up today with a solution that can help you grow, and scale will enable your business to turn on features and functional when and where you need it.
- Poor Change Management and Stakeholder Readiness
ERP failures often result from lack of user buy-in, insufficient training, and teams that are unprepared for the real time and effort required to make ERP implementations successful. The best systems in the world won’t succeed if the company fails to evaluate sufficiently their team’s readiness for such a foundational change.
10 Steps to Select the Right ERP Software Using a Strategic RFP
The best outcomes start with the best planning and due diligence. A disciplined Request for Proposal (RFP) process dramatically reduces risk and improves outcomes. Having seen many successful and failed ERP implementations, here’s a step-by-step framework to ensure ERP selection and implementation succeeds:
- Align on Business Objectives
Before even considering issuing an RFP, begin with the end in mind. Define the strategic outcomes you want such as cost reduction, integration, process automation, improved reporting, compliance, or scalability. Identify and set smart ERP goals and track your progress. Use these goals to guide you throughout each step of the process and embedded as requirements in the RFP.
- Document and Prioritize Requirements
Lead internal workshops with functional stakeholders across Finance, Supply Chain, Procurement, HR, IT, and Operations. Identify pain points, must-have capabilities, and future-state workflows.
Create a workbook with a requirements matrix. Assign Must Have, Nice to Have vs. Future categorization and apply weights aligned to business impact. This workbook will become the foundation of your RFP and can be utilized for supplier responses for easy evaluation.
- Build a Cross-Functional RFP Team
It’s important to build the correct team up front. The governance structure should include team members, across your organization for example Procurement, Finance, HR, IT, Legal etc. Consider the following roles in your governance structure:
- Executive Sponsor – this person is ultimately responsible for the success of the project and will communicate to and influence other executives.
- Project Manager – will be responsible on a day-to-day basis for keeping the project on track, on time and on budget.
- Steering Committee – this team is responsible for making decisions, removing roadblocks, providing resources and determining who the subject matter experts are in their respective departments or functional areas.
- Subject Matter Experts – these are the team members who understand your current systems and processes and who will use the new system once implemented. They will help identify the new system requirements and should be involved in the evaluation, selection and testing phases.
- Develop and Issue a Comprehensive RFP
Your RFP should include:
- A clear problem statement and goals. Refer to “Align on Business Objectives” above to ensure these goals and expected outcomes are included in your RFP.
- RFP workbook clearly outlining technical, functional, and compliance requirements.
- Workflows and use-case scenarios suppliers can demonstrate during demos and workshops.
- Implementation and training expectations. Global remote teams, onsite in person or hybrid? Be crystal clear on what you require to best align with your team needs.
- Timeline, and high-level evaluation criteria. Suppliers will align their proposal to ensure they meet your needs.
- Proposal documents and submission instructions. Leverage RFP workbook for supplier responses and ability to satisfy requirements. “Yes, No or Other” to easily evaluate and quantify responses
- Include a schedule of events including identifying dates for Presentations, workshops and demos. Request suppliers utilize use-case scenarios and ask them to demonstrate real business processes during demos, not generic feature walkthroughs.
- Shortlist 3–5 ERP Suppliers
Use initial RFP responses to shortlist or down select those suppliers who best satisfy your requirements, including:
- Corporate overview, Industry expertise and alignment to your goals.
- Ability to satisfy technical and functional requirements.
- Implementation approach, methodology and timeline.
- Total cost of ownership including, one-time and ongoing licensing fees, implementation fees and support and maintenance.
- Conduct Scripted, Scenario-Based Presentations, Workshops and Demos
Invite shortlisted suppliers to participate in scripted demos based on your use cases. Require them to show how the ERP handles:
- Multi-currency invoicing
- Inter-company transactions
- Specific to your use cases and best in class workflows used by comparable companies using their solution
- Payroll and HR onboarding
- Month-end close or inventory reconciliation
- Procurement, Inventory Management and Production if applicable to your business.
- Address any specific questions each party has regarding the solution
- Pricing, clarifying one-time professional services, training and ongoing licensing fees.
Score Presentations and demos against predefined criteria. This is your opportunity to really dig into the solution and the company to assess if their written proposal is backed up by a comprehensive demo and an experienced and professional team who will have your back. Presentations and demos often dramatically change the outcome of the RFP process. Plan and evaluate carefully to get the best solution and provider to ensure success.
- Evaluate Total Cost of Ownership (TCO)
Don’t just compare license fees. Compare projected 3–5-year TCO total cost of ownership across all solutions suppliers, including:
- One-time and ongoing license fees.
- Implementation and configuration costs
- Integration with existing systems
- User training and support
- Customizations, upgrades, and maintenance
- Post-launch support and SLA commitments
- Assess Risk and Change Readiness
Implementing an ERP solution is one of the highest risk projects your company will ever undertake. I can’t understate how critical it is to plan well in advance at least twelve to eighteen months before you intend to go live. You must assess fully the risks and plans for mitigation. This is an ongoing exercise that must be updated continuously and must include:
- Resource availability during planning, RFP, selection and during implementation. One of the highest risks, if not assessed and planned for, this is the biggest point of failure for many projects.
- Operational readiness and stability. Highly dependent on resource availability, your business my
- Use be stable and ready for this monumental change. Not just during implementation but importantly the potential disruption to your team and operations as you plan and assess the right solution.
- Data security and compliance. (e.g., ISO 27001, SOC 2) understand clearly your data risks and compliance requirements. New systems of any kind must support your security and compliance requirements.
- Final Evaluation and Selection
Using the written RFP workbook evaluations, supplier presentations along with updated pricing proposals, consolidate and update scores for each supplier across:
- Corporate overview and fit. Does the supplier have the requisite experience and ability to successfully implement on time and on budget?
- Implementation approach and methodology. Do they have a methodology and project plan that clearly articulates how they will work with you and your team?
- Total cost of ownership across one-time and recurring fees
- A clear plan to test and train your team on leveraging the full value, features and functionality of the solution not just for today but as you grow and scale your business?
- Ongoing support and maintenance
Choose the right solution and provider not just for the initial implementation but over the long term and you grow and scale your business. The supplier must be able to you not just during implementation but for many years to come. Will they still be there in three, five even ten years from now?
- Negotiate Terms, Lock In Value
Once you’ve selected a preferred supplier:
- Lock pricing and renewal terms for 3–5 years and beyond. It is unlikely you will be switching suppliers within a year or even three. Now is the best time to lock in long term pricing.
- Cap future rate increases during renewal terms by applying price caps tied to CPI or a percentage for up to 5 to 7 years.
- Negotiate data residency, ownership and exit clauses. You MUST own your data, control the movement and access to your data and take it with you when you transition off the solution.
- Negotiate SLA’s including, uptime, support, issue resolution and escalation. Be clear on implementation roles, responsibilities, deliverables and acceptance criteria.
This is also the time to validate partner alignment, implementation phasing, and long-term roadmap compatibility.
ERP Trends That Will Shape Your RFP Strategy
- Cloud ERP as the Global Standard – Cloud ERP adoption continues to surge due to scalability, faster deployments, and global access. Ensure your RFP addresses data residency, compliance, and multi-site deployment requirements.
- Composable ERP Architecture – Businesses are adopting modular ERP platforms that allow them to implement only what they need today—and scale with plug-and-play capabilities tomorrow.
- Embedded AI and Automation – Leading ERPs now include AI for cash flow forecasting, predictive maintenance, anomaly detection, and workflow automation. Your RFP should include questions around native vs. third-party AI integrations.
- Global Compliance and Localization. Ensure the ERP supports; Country-specific tax rules (VAT, GST, withholding tax). E-invoicing regulations (Peppol, SAF-T, etc.). Multilingual and multi-currency functionality. PIPEDA, GDPR, CCPA, and other data privacy requirements
- Stronger Focus on Cybersecurity – Global ERP buyers must demand vendor transparency on cybersecurity protocols, audit trails, encryption, and threat detection tools. Include security and compliance questions in your RFP.
Conclusion: A Strategic RFP Process Turns ERP Chaos Into Clarity
Selecting ERP software is one of the most consequential technology decisions a business will make this decade. It requires structure, alignment, and a deep understanding of what success looks like across all business units.
A strong ERP RFP process helps you:
- Align technology with business strategy
- Ensure cross-functional stakeholder engagement
- Control costs and avoid scope creep
- Mitigate risks related to your readiness, the supplier capabilities, implementation, and adoption
- Choose a system that scales with your business today and into the future
If you’re looking for expert support to navigate your ERP selection procurement ProcurePro Consulting is here to help. Setup time with me for an exploratory discussion and let’s craft a strategy that works for your business.
Check out other great articles including Writing Effective RFP Requirements
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