How To Measure ERP Performance To Know The Effectiveness Of ERP Software System? (Terro Dashner)

How to measure ERP performance? Before we answer this question, we need to know more about ERP (Enterprise Resource Planning) software system. If you are a complete newbie, it's nothing but software, which can be used by companies to manage their overall operation. Unlike independently working human resource software or accounting software, Enterprise Resource Planning software can join all these different modules in to a single stream. So, it's all about joining different modules in to a single one. Enterprise Resource Planning software combines all these different streams in to a single one with a centralized database. By doing so, it is able to provide key data to all departments. The communication between the key departments results in a highly efficient system.

Companies are able to reduce the complexity and at the same time increase the productivity and efficiency with the help of this software. When it was first introduced in the 1990s, this software was meant only for the manufacturing industry where it bridged the gap between accounting and manufacturing modules. However, it later evolved in to full-fledged software which can be used by any industry be it retail, service etc. However, when you opt for Enterprise Resource Planning software, you need to ensure that the vendor is giving the best service or product. How to measure ERP performance? We'll see more on that below.

To measure ERP performance, one has to follow certain steps. It's not difficult to measure ERP performance as long as you are ready to follow the steps. Let's take a look at those important steps below. The very first step here is the preparation. You need to see the preparations are done properly by the vendor. You need to check whether they have studied your company and its organizational structure before implementing this software for you. The second important step to measure the performance is to keep a close eye on the terms and conditions that they had signed before they started doing the implementation. Are they keeping their terms and conditions intact? If not, make sure that you let them know about your displeasure. The next performance evaluation step is to see if you get Return On Investment (ROI). If the ROI is negligible you need to notify the vendor as soon as possible to avoid any future debate.

The next important step is to do the period work evaluation. You need to evaluate your vendor's work periodically to see if they are on track. Are they making mistakes? If they make mistakes, notify them right away. And constantly remind them about their work. You should take these repeated lapses and errors seriously as it is not an indication that the vendor is doing well on his part. The next performance evaluation step is to assess the targets. Before they started the implementation they must have a given a detailed project plan. This project plan contains the milestones with dates against it. You need to verify if they are indeed achieving milestones at the right time. And the most important performance assessment is to verify the time frame quoted in their plan. Are they keeping their time frame? Then it's great. Else, it's time for you to start asking questions. Processing ...