Why You Should Avoid RFP Templates for ERP Implementation

What is a Request for Proposal (RFP)?

A Request for Proposal (RFP) is a document outlining project details that an organization uses to evaluate prospective vendors, partners, and contractors to complete requested work. RFPs are usually drafted by the project lead, and they outline the project goals, budget, timeline, and criteria for partnership. While it is possible to write one from scratch, most people will use a readily-found RFP template that is similar to their project scope and aligned with their industry. RFPs are most commonly used for software-related projects. Drafting an RFP for ERP implementations is often one of the first steps.

RFP templates for ERP implementation are often accompanied with a list of software features, including add-ons and system integrations, to help you easily determine your ERP criteria. After the RFP is drafted and approved by upper management, project managers will send it out to ERP vendors. Upon receiving an RFP, vendors can choose to respond if they think they can offer what you are seeking. The RFP process is like a funnel; you may send out 30 requests, receive 20 responses, 15 of which are qualified, and finally move forward with evaluating the handful that have made an impression. 


The Problem with RFP Templates for ERP Implementation

RFP ERP templates push you to identify a list of features and capabilities in an ERP solution, rather than a list of goals you wish to achieve through the ERP solution. While a list of features makes it easier to evaluate vendors objectively, the list of features in your RFP are often not actually what your organization needs.

Secondly, when you pull from a list of ERP requirements to assist your RFP draft, it is easy to convince yourself you need features that did not even previously cross your mind, simply because these features are new, innovative, and therefore attractive. These are features you think you might need in the future, so you decide to include them in your request. The problem is that while these features may lead to improvements in your enterprise, they ultimately are not tied to your original objectives. Too many unneeded features not only add costs, but they can cause an overcomplicated ERP that hinders your teams’ performance.  

RFP templates for ERP implementation can often span over 50 pages, but the majority of these pages are filled with unimportant boilerplate text, followed by an endless list of ERP features that realistically, no solution can truly fulfill. As a result, most responding vendors will overpromise on the abilities of their software and lowball the total cost to make it under your budget. You will eliminate proposals that have higher costs and unfulfilled requirements – even though that solution may be most suited for your organization’s needs.


A Strong RFP Starts with Well-Defined Objectives 

Do not confuse features with goals; anything the software does is a feature, not a goal. Consider the following example: ‘Automated customer invoices’ is a feature, while ‘reducing time spent on manual administrative tasks by 20%’ is a goal.

Examples of goals include:

  • Decrease costs by X%
  • Increase revenue by X %
  • Expand to X geographical areas

The reason you want to replace the lengthy list of ERP features with specific goals is because you may not have a true understanding of what features are the best approach to achieving your goals, so being adamant that your organization needs certain features in its ERP may do more harm than good.

For example, instead of ‘a fully open API’, perhaps you are a construction firm that just needs an ERP that connects with common construction management software. Or, instead of ‘custom dashboards with data visuals’, perhaps you are a B2B business that specifically needs a financial dashboard that derives data from your CRM to show conversion metrics in the sales funnel. Finding the right feature to reach your goal is the challenge – and often you need a business technology management specialist to help in this process.


Narrow Your ERP Evaluation Criteria

You should end with only a handful of goals because having too many dilutes the project. Detail is good when it comes to the processes developed and the software features used to achieve the goals, but not when it comes to defining the goals, so keep things concise.

Be sure that you make big decisions before soliciting ERP proposals. Determine the type of cloud hosting and type of ERP tech stack beforehand, instead of using an RFP template for ERP implementation to make these decisions. It is critical you already have a strong understanding of what type of business management solution is most appropriate.

Finally, your ERP evaluation criteria should be focused as well. Top cyber-security, increased efficiency, better customer experience, stronger financial visibility, low implementation cost, and solution integrations are objectives that every organization will want – but you must determine which is most important. 


How to Define Objectives

Because project leads commonly overestimate their understanding of their organization’s true needs, the defining of objectives can often become skewed or misaligned with what the organization actually needs. This is especially common if these objectives are defined by the IT department. The step of defining objectives must be led by someone who is extremely knowledgeable about the business as a whole, such as the CEO, CFO, or COO. Their strong understanding of the organization should be coupled with input from different representatives on departmental pain points. Still, even at a C-Suite level, the business analysis is often not as accurate as it could be because project leads are only looking at things from an internal perspective. 

One of the biggest benefits of working with an ERP consultant is their years of experience in business management analysis, and their ability to diagnose problems from an external perspective. Moreover, because ERP consultants are specialists in business technology management, they will be able to more efficiently determine what type of hosting and build your ERP should have. And certified ERP consultants will be experts in specific solutions available in your field, so they can help you convert your business objectives into common features. 


Replace Vendor Solutions with a Custom-Designed ERP

Good ERP consultants will redefine the ERP implementation process, replacing the RFP ERP templates with a solution design process. This way, every module that becomes included in your new ERP is something that serves the organization’s goals. Select ERP consulting groups may also have developers that can assist with coding in custom modules and integrations for your solution.

Learn more about ERP Implementation based on Solution Design.

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