Is Your Company Ready for ERP?
Before investing in an ERP system, every manufacturing company should honestly assess their readiness across five critical dimensions. Rushing into implementation without adequate preparation is the single biggest cause of ERP project failure.
The Five-Dimension Readiness Framework
1. Strategic Alignment
Key Question: Does leadership agree on WHY you need ERP?
Assess whether: - Executive sponsorship is committed (not just approved, but actively championing) - Business objectives are clearly defined and measurable - The ERP project aligns with your 3-5 year business strategy - Budget expectations are realistic (typically 3-5% of annual revenue for total cost)
Red Flags: Multiple competing priorities, CEO says "IT will handle it," no clear business case.
2. Process Maturity
Key Question: Are your current processes documented and standardised?
Assess whether: - Core manufacturing processes are documented (not just "how Dave does it") - You have standardised procedures for order-to-cash and procure-to-pay - Quality processes are defined and followed consistently - You understand which processes need to change vs. which the ERP should support as-is
Red Flags: Heavy reliance on tribal knowledge, every customer order is "special," no written procedures.
3. Data Readiness
Key Question: Is your master data clean enough to migrate?
Assess whether: - Item master data is complete and accurate (descriptions, units of measure, lead times) - Bills of materials are current and validated - Customer and vendor records are deduplicated - You have a realistic plan for data cleansing (typically 30-40% of implementation effort)
Red Flags: "We'll clean data during migration," duplicate records everywhere, BOMs haven't been updated in years.
4. Technical Infrastructure
Key Question: Can your infrastructure support the new system?
Assess whether: - Network connectivity is reliable at all locations (especially the shop floor) - You have an IT team or partner capable of managing the platform - Integration points with existing systems are identified (CAD, MES, e-commerce, banking) - A disaster recovery plan exists
Red Flags: Frequent network outages, no IT staff, running critical systems on unsupported hardware.
5. Change Capacity
Key Question: Can your organisation absorb this level of change?
Assess whether: - Key users are identified and available (minimum 20% of their time during implementation) - A training plan budget is allocated (don't underestimate this — most companies spend too little) - The organisation has successfully managed previous technology changes - There's a communication plan for keeping all employees informed
Red Flags: "We don't have time for training," recent failed IT projects, high staff turnover.
Scoring Your Readiness
Rate each dimension 1-5: - 1-2: Not ready — significant gaps to address - 3: Partially ready — some preparation needed - 4-5: Ready — minor refinements only
Total score interpretation: - 20-25: Green light — proceed with implementation planning - 15-19: Yellow — address gaps before starting - Below 15: Red — pause and invest in preparation first
What To Do If You're Not Ready
Being "not ready" isn't failure — it's intelligence. Companies that invest 2-3 months in readiness preparation before starting implementation have significantly higher success rates.
Focus on: 1. Securing genuine executive sponsorship 2. Documenting your top 10 core business processes 3. Starting master data cleansing now 4. Identifying and freeing up key users
Next Steps
Ready to go deeper? Read our ERP Implementation Lifecycle guide or explore platform comparisons.