How to Hire an ERP Selection Consultant, and What to Put in the RFP
Updated: 18 hours ago
The person who starts an ERP search is usually in IT, procurement or a program management office, and one of the first decisions is whether to bring in outside help and whom to hire. The market makes that harder than it should be. "ERP consultant" covers software resellers, implementation partners, staffing firms, large consultancies and independent advisers, and they are paid in very different ways.
An ERP selection consultant, in the sense used here, helps a company choose its ERP software and its implementation partner and is paid only by that company. This guide is for manufacturers and distributors hiring that kind of help: what the work should include, the questions that test independence and experience, what to put in the RFP, and how to compare proposals. We are an independent ERP selection firm ourselves, so read it with that in mind. The questions work on any firm, including ours.
Know who you are talking to
Four kinds of firms answer to "ERP consultant."
Resellers and implementation partners sell and implement one or two products. Their knowledge of those products can be excellent, but their advice on whether to buy them cannot be independent. Many offer a free or low-cost selection that ends with their product.
Staffing and contract firms supply individual consultants by the hour. They add capacity, but you manage the work and supply the method.
Large consultancies bring breadth, often along with alliance relationships with the major vendors and a staffing model in which junior analysts do much of the work.
Independent ERP consultants and selection firms have no product to sell and no vendor relationship to protect, and they bring a method for running the whole selection.
Each has its place. The costly mistake is hiring one kind while believing you have hired another.
What an ERP selection consultant should deliver
For a manufacturer or distributor with several sites, the engagement should produce:
A charter, with decision criteria and weights agreed before anyone sees a demonstration.
Requirements written as business scenarios, prioritized and signed off by the process owners. "Ship partial quantities against one customer PO and bill by shipment" can be demonstrated and scored; "strong order management" cannot.
An RFP to a short list of software-and-partner combinations, with the consultant managing vendor communication so your team is not pulled into sales cycles.
Scripted demonstrations run on your scenarios and sample data, scored by the people who attended.
A like-for-like total cost of ownership comparison over several years.
A decision document, support in contract review, and selection of the implementation partner.
Our 16-week selection plan shows how these pieces fit together week by week.
One thing the consultant should not do is make the decision. Your leadership team owns it. The consultant's job is to make sure it is made on evidence, by the people who will live with the system, and that nobody on either side of the table can steer it quietly.
Questions that test independence
Do you have reseller, referral, alliance or commission arrangements with any ERP vendor or implementation partner? Will you disclose them in writing in the contract?
Will anyone other than us pay you anything in connection with our selection, now or after it?
Will your firm implement the system we choose? If so, the outcome of the selection affects your revenue.
Which systems did your last several clients choose? A firm whose selections always end with the same product is telling you something.
When did you last advise a client to keep its current system?
For what it is worth, our own recent selections ended with different answers: IFS Cloud for a multi-site industrial fabricator and Acumatica for a specialty distributor.
Questions that test the people
Who will run our program day to day, and how much of their time will it get? Can we meet them before we sign?
What have they done in operations like ours: multiple plants, make-to-order or engineer-to-order production, branch networks, warehouse operations, costing, EDI?
Who writes the requirements: senior people in workshops with our process owners, or a template from a database?
May we see redacted examples of a requirements document, a demonstration script, a scorecard and a cost comparison?
May we speak with three clients of similar size and complexity? Ask those clients what went wrong and how the firm handled it.
What to put in the RFP for an ERP selection consultant
A short RFP of five to eight pages gets better answers than a long one. Include:
Company profile - Revenue band, sites and legal entities, modes of manufacturing or distribution, current systems and integrations, and users by function.
Why now - The business drivers, any event forcing the timing (an acquisition, a new plant, a support end date) and the constraints (peak season, year-end close).
Scope - The deliverables above, and whether implementation-partner selection, contract support and a pre-implementation phase are in or out.
Timeline - The target decision date and any hard deadline.
Confidentiality - A mutual non-disclosure agreement before you share financials, volumes or process detail.
Your team - The sponsor, the steering committee, the process owners and the time each can give.
What each response must include - The method week by week; the named team, with experience and time commitments; a written independence disclosure; three references; sample deliverables; the fee structure and what it excludes, such as travel; assumptions about on-site work; and confirmation that you own every deliverable, including requirements and demonstration scripts.
How you will decide - The evaluation criteria and weights, the deadline for questions, the response date and the finalist interviews.
How to compare proposals
Score every response against the weights you published, then interview the people who would do the work, not only the person who sells it. Put the fees on the same footing before comparing them: the hours and seniority behind each one, and what each leaves out. The lowest fee is often the one that leaves the demonstrations, the cost model or the contract review to your team. Finally, ask each finalist what they would need from your people each week. A firm that has done this many times will answer precisely.
Red flags
A free selection, or a fee that depends on what you buy.
Requirements pulled from a generic database with no workshops.
Ten or more vendors in the demonstrations.
Senior people in the pitch and junior people in the work.
Reluctance to put the independence disclosure or the named team in writing.
A proposal that could have been written for any company, with no questions asked about yours.
Frequently asked questions
Do we need an ERP selection consultant at all? Not always. A company whose team has run a selection recently can do it alone. Most manufacturers and distributors replace their ERP a decade or more apart, so few people inside have done it before, and that is the usual case for outside help.
How long does an ERP selection take? Twelve to twenty weeks from kickoff to signed contracts for a company with several sites.
What will the consultant need from our team? A sponsor who can make decisions, process owners who can give several hours a week during the requirements and demonstration weeks, IT for the integration and data sessions, and someone inside to coordinate calendars and chase sign-offs. Programs without that coordinator run late.
How are ERP selection consultants paid? Usually a fixed fee or a not-to-exceed budget for a defined scope, reported against actual hours. Avoid any arrangement tied to the software you buy.
Should the selection consultant also implement the system? Keep the selection independent. An adviser can stay on your side of the table during implementation, leading the program and holding the partner to the contract, without being the implementer; that is what client-side program leadership means.
If you are writing the brief for an ERP selection now, talk to John about your ERP program.
