Selecting an Enterprise Resource Planning (ERP) system is an important decision that can shape how a business runs day to day. ERP solutions connect core areas like accounting, inventory, HR and operations in one place, making it easier to manage tasks, share information and plan strategically. We’ll walk you through what you need to know about ERP selection and evaluation so you can make an informed decision that aligns with your business goals.

What’s an ERP?

An ERP system is software that consolidates and manages core business processes. It connects different departments—like accounting, HR and customer service—enabling seamless communication in real-time.

Why do organizations need ERPs?

Implementing an ERP is essential for businesses that want to streamline operations, reduce redundancies and scale effectively. Manufacturers use ERPs to manage supply chains, production schedules, inventory, quality control and order fulfillment. ERPs essentially allow companies to do more with less.

Hospitals and healthcare networks, for example, use ERPs to manage patient records, scheduling, billing and regulatory compliance. Government agencies implement ERPs to effectively manage public resources, improve transparency and accountability, and streamline core operations. The right ERP system can be a game-changer for any organization.

Benefits of modern ERPs

  • Improved efficiency: ERPs automate manual processes and reduce time-consuming tasks. Employees can focus on higher-value work, and organizations experience increased productivity and faster turnaround times.
  • Data accuracy and visibility: With a centralized system, businesses can eliminate data silos and gain real-time access to accurate information. This improves decision-making and reduces costly errors attributed to outdated or inaccurate data.
  • Regulatory compliance: ERP systems often have built-in tools to support compliance with legal requirements and industry best practices, helping reduce risk. An ERP that complies with state, local and federal regulations is imperative for government organizations.
  • Scalability: Modern ERP solutions can grow with your business. As your organization expands, your ERP can adapt to new users, processes and functionalities without a complete overhaul.
  • Cost savings over time: Although ERP systems can require a substantial upfront investment, they often pay off over time by streamlining operations, reducing mistakes and supporting better business decisions—all of which can lead to significant long-term savings.

What are the different types of ERP deployment?

  • Cloud ERP
    Cloud ERP is hosted on the vendor’s servers and accessed via the Internet. It typically drives agility with faster implementation, lower upfront costs and automatic updates.
  • On-Premise ERP
    This traditional ERP model is installed on a company’s own servers and maintained internally. It offers complete control over the system but comes with higher upfront costs and maintenance responsibilities.
  • Hybrid ERP
    Hybrid ERP combines elements of both cloud and on-premise solutions, offering flexibility for companies that need specific systems in-house and others in the cloud.

Considerations for the right ERP solution

Choosing the right ERP system involves careful evaluation of your organization’s needs, goals and constraints. A poor selection can result in wasted resources, while the right ERP can transform your operations.

  • Industry: Your industry may require specific ERP features—government, manufacturing, retail and healthcare all have unique needs. Choose a system that understands your vertical.
  • Business requirements: Identify core business processes and pain points. The ERP should support your operational workflows, reporting needs and future growth plans.
  • Management needs: Executives need visibility into KPIs and performance metrics. A good ERP supports strategic planning through real-time dashboards and analytics.
  • User needs and support: Consider your team’s technical proficiency. Choose a user-friendly system with training and ongoing support to ensure adoption and effectiveness.
  • Existing systems: Evaluate how the ERP will integrate with your current software tools. Seamless integration can save time and reduce disruptions during implementation.
  • Cost, budget and resources: Beyond licensing fees, consider implementation, customization, maintenance and training costs. Ensure the total cost of ownership aligns with your budget and internal capabilities.
  • Technology – scalability and customization: The ERP should scale as your business grows. Look for platforms that offer configuration options to fit your unique processes and allow for innovation.

Who assists in the selection process?

The ERP selection process typically involves a cross-functional team, including IT, finance, operations and executive leadership. The team should include both leaders and end users to ensure all requirements are considered and all key stakeholders are represented.

Some organizations also hire external consultants or Third-Party Advisors (TPAs) to provide an objective perspective. These experts use deep industry knowledge and proven evaluation frameworks to help businesses avoid common pitfalls.

In the public sector, the ERP selection process is often more structured and transparent than in private companies. It usually involves formal RFPs (Requests for Proposals) outlining detailed requirements and evaluation criteria. These documents and their responses can be accessed through FOIA (Freedom of Information Act) requests. Because of this high level of scrutiny, government agencies often work with TPAs to ensure every step of the evaluation is fair, compliant and well-documented.

CGI can help you understand your ERP requirements

We specialize in guiding commercial and government organizations through ERP selection and evaluation. We begin by understanding your business—your goals, challenges, workflows and people—and then align those insights with potential ERP solutions.

Our team brings a structured approach to ERP evaluation from initial discovery to final decision. We help you create an ERP checklist based on your unique needs and ensure that any solution you consider supports your long-term success.

Whether you’re replacing an outdated system or implementing an ERP for the first time, we’re here to support you at every stage. With our help, you can avoid costly missteps and choose a system that delivers real value from day one.

Selecting the right ERP solution is more than just a technology decision—it’s a strategic one. By understanding your needs, evaluating your options and involving the right partners, your organization can implement a system that drives efficiency, growth and competitive advantage. Start your ERP journey today with a trusted and experienced guide.