Accounting professionals in the not-for-profit sector wear many hats. We often have the blessing and curse of selecting and implementing enterprise resource planning (ERP) systems. If you have undertaken this herculean effort before, you’ll probably never forget the education you gained throughout the experience. If you haven’t had the opportunity yet, there are some things you should consider to help your not-for-profit or your not-for-profit clients avoid mistakes. Here are five key lessons I learned when selecting an ERP system for my organization.
- You get what you ask for. It’s important to be specific about what you want to do and how you want to do it so you can find out if vendors can accommodate your needs. If the business requirements you specify are too generic, you may be surprised to discover significant gaps in the system’s capabilities too late in the game. For example, saying you need the ability to make electronic payments may be too generic. Instead, indicate that you need the ability to automate batches of electronic payments via EFT and wire. In this example, the added clarity ensures the system can not only make electronic payments but also process them via EFT, and that payments may be initiated through automatic batches rather than manually, one by one.
- Look past the sales pitch and focus on the system. Go into the sales presentation prepared. Know that the salesperson will try to wow you by talking about capabilities that may be out of your scope, so stay focused on your specific needs and whether the software product’s capabilities are a good match. You know your organization and what is feasible, but it also may be helpful to invite other key players to the meeting, including your implementation specialist or project manager, since they may have additional questions or concerns.
- Be willing to adjust your business processes. It is likely your organization’s business processes were developed to accommodate the current ERP system. This means it’s unlikely all of those processes follow best practices. If a new system doesn’t meet your business requirements, consider whether it is a deficiency of the ERP system or an internal process. Perhaps the business requirements relate to a process that could be simplified or modified in the future, moving more toward best practice in the new system. Approach the selection process recognizing some processes will have to change.
- Make sure the information technology (IT) team has bought into the solution, even if it is cloud-based. Many vendors try to sell cloud-based applications to the functional side of the business directly by stating that no IT assistance is required. Most of the time, that’s simply not the case. Most business units are not equipped to dive into IT configurations, and the solutions may not meet the internal architectural or security guidelines. Make any selection in partnership with your IT team, starting with input into the functional requirements, through the sales process and on to implementation and evaluation.
- The system is only as good as the implementation. Carefully consider what you are looking for in an implementation partner. Do you need:
- Assistance identifying best practices for the future?
- Support navigating complex needs that might require customization?
- Help with data integrations?
- Help following a specific project implementation approach, such as the waterfall or agile method?
Clarify upfront what you need from an implementation partner and seek one with those strengths. Otherwise, you could spend valuable hours engaging with them, only to find they are missing the mark and not providing the specific guidance you need.
No ERP system is perfect, but applying these lessons when selecting a new system may help you choose a good match for your organization and more fully leverage its capabilities.
For more information, tools and resources to help not-for-profit professionals, visit the AICPA’s Not-for-Profit Section. You’ll find a comprehensive resource library covering topics in not-for-profit accounting and financial reporting, assurance, tax compliance, and governance and management, along with the latest news and learning opportunities related to those topics.
Jennifer Brenner, CPA, Controller, World Vision US, has more than fifteen years of public and private accounting experience, including domestic and international accounting and tax compliance. She serves as chair of the AICPA’s Not-for-Profit Industry Expert Panel.
Enterprise resource plan graphic courtesy of Shutterstock
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Originally published by AICPA.org