A thorough planning process is crucial when selecting and implementing an enterprise resource planning (ERP) system. One of the most important foundations for the successful use of an ERP system is the requirements specification. This serves as a comprehensive specification that defines the company’s requirements and expectations for the ERP software.
Creating a requirements specification may seem like a complex task at first glance, but with a step-by-step guide, this process can be significantly simplified. Here, we will provide you with a guide to help you create a sound and precise requirements specification for your ERP projects.
A carefully prepared requirements specification forms the basis for selecting the right ERP system and establishes the framework for successful implementation. By following the steps in this step-by-step guide, you can ensure that your company benefits from a customized ERP system that meets your specific requirements and supports your growth.
Requirements specification and functional specification: The differences
In ERP system implementation, the terms “requirements specification” and “functional specification” are often used. Although they are similar and closely related, there are still clear differences between the two concepts.
The requirements specification focuses primarily on describing the company’s requirements and expectations for the future ERP system. It defines which ERP functions, features, and processes the system must fulfill to meet business needs.
In contrast, the functional specification is a document that builds upon the requirements specification and describes the technical and functional requirements in detail. It contains specific information on how the ERP system will fulfill the requirements defined in the requirements specification. The functional specification can include technical specifications, database structures, interface requirements, security and data protection measures, and other technical details.
While the requirements specification is written primarily from the company’s perspective and focuses on strategic goals and business requirements, the functional specification is geared more towards the ERP provider’s perspective. It serves as the basis for creating proposals and for the technical implementation of the ERP system.
It is important to note that the requirements specification and the functional specification are interconnected and mutually influential throughout the ERP project. Changes to the requirements specification can affect the functional specification, and vice versa. Clear communication and coordination between the various project stakeholders are crucial to ensure that both the requirements specification and the functional specification adequately reflect the company’s needs.
By understanding the differences between the requirements specification and the functional specification, and by using both documents correctly in the ERP project, you lay the foundation for a successful implementation that meets both business goals and technical requirements.
Why ERP systems?
Creating an ERP requirements specification is a crucial step in implementing an ERP system, regardless of the company’s size. Even for SMEs, a requirements specification is of great importance and can help them effectively communicate their specific requirements and goals.
Here are some reasons why even small and medium-sized enterprises can benefit from an ERP system:
It is important to note that selecting and implementing an ERP system requires careful planning and resource allocation, regardless of the company’s size. Needs and requirements can vary from company to company, so a tailored approach is advisable.
Creating an ERP requirements specification: Basic considerations
Before creating an ERP requirements specification, there are some fundamental considerations a company should take into account. It is important to address certain questions in advance to ensure that the specification adequately captures the company’s specific requirements and goals. Here are some key questions companies should ask themselves before implementing an ERP system:
Which business processes need to be covered?
Which core processes are most important for the company?
Are there specific industry-specific requirements that need to be taken into account?
Which tasks should be automated or improved?
What functionalities are needed?
Which modules and functions should be included in the ERP system? (e.g., financial accounting, inventory management, sales, purchasing, production, CRM)
What specific requirements exist regarding reporting, analysis, and integration with other systems?
What level of scalability and flexibility is required?
How will the company develop in the future? What growth plans are there?
What requirements might change or expand?
What integrations are required?
Are there any existing systems or software that need to be integrated with the ERP system?
Which external interfaces (e.g., banks, suppliers) need to be considered?
How is the data migration planned?
- What data needs to be migrated from the existing systems to the new ERP system?
- How should the data migration and data matching be carried out?
What user requirements and training needs exist?
How many users will use the system and what roles will they have?
Are there any special training or education requirements for users?
What is the budget plan?
What budget is available for the implementation and ongoing operation of the ERP system?
What costs are associated with the purchase, implementation, customization, and maintenance of the ERP system?
These questions serve as the starting point for creating a comprehensive ERP requirements specification. By clarifying these considerations in advance, companies can ensure that the requirements specification accurately reflects their business needs. This lays the foundation for a successful ERP implementation and smooth business operations.
The structure and content of an ERP requirements specification
An ERP requirements specification should have a clear and structured layout to ensure that all relevant information is included. Generally, it covers the following areas:
1. Structuring the requirements specification
To ensure a successful ERP project, it is essential to have a It is essential to create a clear structure for the requirements specification. Such a structure plays a crucial role in the readability, clarity, and comprehensibility of the information it contains. Furthermore, it facilitates communication and collaboration with all project stakeholders and significantly contributes to achieving the defined objectives.
2. Describe your company
To provide ERP providers with a better basis for adapting the solution to your needs, it is recommended to start with a comprehensive description of your company. This description should include the company’s goals, organizational structure, and business activities.
Furthermore, provide a detailed description of your products and services, as well as the market in which you operate. It is important to give an overview of your customers, competitors, and current trends in your industry. This information will enable software providers to identify the specific requirements and challenges of your business.
Highlight your strengths and unique selling points compared to your competitors. This can include aspects such as quality, customer service, innovation, or technological expertise. This information enables ERP providers to better understand your specific requirements and offer tailored solutions.
3. Identifying employee requirements
To identify the employees affected by the ERP system, it is advisable to create a comprehensive list of internal and external staff. Determine employee requirements and expectations by conducting interviews, workshops, or surveys to gain a better understanding of their needs.
4. Current IT landscape
Describe your existing IT infrastructure and system landscape, including the software and hardware used. This includes information about both the software and hardware used. Furthermore, it is important to specify how many users are using the current systems and how they are being used.
5. Definition of goals and requirements
To identify the main goals of the ERP system for your company, it is important to make a precise definition. Possible goals could include improving efficiency, optimizing processes, or integrating different departments.
Once the main objectives have been defined, you should create a comprehensive list of requirements that the ERP system must meet to achieve these objectives. This list should include both functional requirements (e.g., accounting, inventory management, production planning) and non-functional requirements (e.g., usability, scalability, security).
It is important to describe each requirement in detail and to use clear and precise language. This allows ERP providers to better understand the requirements and create a tailored offer based on them.
6. Determining the scope
Define the scope of the ERP system. Consider which modules and functions you need and which you don’t. In doing so, you should take into account the specific requirements and processes of your company.
In addition to the modules and functions, you should also define your company’s reporting requirements. Consider what types of reports and analyses you need to track your business performance and make informed decisions. This could include, for example, financial reports, sales reports, inventory analyses, or supply chain reports.
7. Time planning and budget
Provide a timeframe for the ERP implementation, including key milestones and schedules for each phase of the project. This helps ERP vendors understand the scope of the project and plan the implementation accordingly.
Establishing a budget is crucial to ensuring the financial feasibility of the ERP project. The requirements specification should clearly outline the expected ERP costs and the available budget. This enables decision-makers to plan financial resources appropriately and ensure the project stays within budget.
8. Contact person
Identify the project contacts within your company who are responsible for communication and collaboration with the ERP providers. Provide their contact details and responsibilities to ensure a smooth exchange of information throughout the project.
9. Validation of the requirements specification
Review the requirements specification for completeness and consistency. Ensure that all goals and requirements are covered and that there are no contradictions. Have the relevant employees review and validate the requirements specification. Consider their feedback and adjust the requirements specification as needed.
A well-structured ERP requirements specification with clear and comprehensive information forms the basis for a successful ERP implementation and facilitates the selection process of the appropriate ERP provider.
Conclusion on the ERP requirements specification
Creating an ERP requirements specification is a crucial step for companies that want to implement or update an ERP system. The requirements specification serves as a comprehensive document that clearly defines the company’s requirements, goals, and expectations, and acts as a guide for the selection and implementation process.
A well-prepared ERP requirements specification offers numerous advantages. It creates clarity and a shared understanding both within the company and with the ERP provider. Furthermore, it enables informed decision-making during ERP selection and provides a solid foundation for implementation.
Furthermore, the requirements specification helps to minimize risks, monitor project progress, and ensure adherence to budget and schedule. It promotes efficient collaboration among all stakeholders and helps ensure that the ERP system meets the company’s specific needs.
Creating a requirements specification demands time, resources, and a thorough analysis of the company’s needs. However, it is an investment that pays off, as it helps ensure that the ERP system delivers the desired added value, optimizes business processes, and supports the company’s growth.
By following the step-by-step instructions we have presented, companies can create a sound and meaningful ERP requirements specification and thus significantly increase the chances of success for their ERP implementation.