GUIDE : What are the steps to choose an ERP for a professional services?

Despite the desire of a service company to equip itself with an ERP, three fears regularly disrupt the purchasing decision: acceptance by the teams, fear of change and fear of a complex deployment. Are you not convinced ? Here are 3 big reasons to implement an ERP tailored to your service activity.

A detailed analysis of your needs and of what the ERP systems you are comparing will allow you to better align your specific needs with the functionalities offered by the tools, and will ensure that you overcome these three difficulties inherent to such a change.

By following this guide, you will be able to accurately evaluate each step of your processes and ensure that you identify the best ERP for your service company. Let yourself be guided step by step.


The advantages of an ERP for professional services companies

All teams save time in their work when an ERP is implemented:

– Employees find all of their actions in the same tool. Depending on their rights, they access their projects, their time tracking, their planning, their expense and absence management. Beyond the time saved in finding everything on a single platform, the employee experience is also simplified

- Support teams, finance teams and management perform their monitoring, validation and control tasks on a single platform. Notifications and tasks are centralized, which makes it possible to move forward more quickly

A service company that uses an ERP adapted to its business, increases visibility on its performance tenfold.

Precise knowledge of project margins. Anticipation on projects that are deviating from their budgets. Visibility on utilization rate employees (time spent on billable projects).

The numerous indicators on the past and projected performance of the company allow to quickly improve the situation by knowing where the improvements are, and gaining anticipation in the decisions.

ERP in a service company connects all the teams, but also the stakeholders of the projects on which the company is working. The ERP is a central solution on which all stakeholders connect and share information. This connection brings efficiency in work and better quality to projects.

Step 1

Restrict the field of possibilities

When you start your search for an ERP, make sure you identify the solutions truly dedicated to your business. If you are a consulting company for example, carry out a specific search for an ERP dedicated to consulting companies. There are in fact ERPs dedicated to all types of professions and it can happen that those that are best suited are poorly targeted.

For this initial analysis, an in-depth internet search is sufficient. There are software comparators, and especially Google, which allows you to identify the solutions most aligned with your needs.

Generally, the ideal search should allow the analysis to be restricted to a number of 3 to 5 solutions. It may not be very productive to look beyond this number, as chances are the initial analysis will allow you to narrow the number down.

2nd step

Prepare your specifications to compare ERPs

To make a foolproof comparison and make the best choice, you can create a benchmark document to review all the topics that matter to your company. To make your work easier, we have listed the different topics to review, and the questions you can ask.

1. The main points to study on the functionalities

Planning management and resource planning teams

A good ERP should give you as much visibility into the past as into the forecast. Resource and planning management makes the difference between a basic ERP and an end-to-end solution that integrates the key process of resource planning and planning which is at the heart of a service company.

It is necessary to check whether the ERP allows:

  • to assign employees to projects and businesses
  • to calculate load indicators such as staff activity rate, TACI, ...
  • to facilitate the search for profiles based on skills and other criteria (experience, employee preferences, etc.)
  • view schedules, and connect to employee calendars
  • calculate production, turnover and forecast costs of projects using the load forecast
  • to flag employees who risk switching to inter-contract

Questions you can ask on this topic:

  • Is skills management integrated?
  • Can employee preferences be taken into account?
  • What are the indicators that allow you to better manage the load?
  • Can we easily assign employees to projects and tasks?
  • How to script the resource planning on projects that have not started?

Project management and margin calculation

The ERP must provide complete visibility to your company on the performance of the activity.

The points to check are as follows:

  • Monitoring of all costs (staff, subcontracting, purchases, expenses)
  • Calculation of turnover adapted to the type of invoicing (package, management, subscription, etc.)
  • Calculation of margins at the date and completion of the project
  • Analysis of gaps between production and invoicing of a project
  • Analysis of gaps in time spent on the project, on project tasks, per person

Questions you can ask on this topic:

  • How is revenue recognition managed?
  • How are project margins calculated?
  • How is uninvoiced production reported?
  • How are subcontracting costs reported?

Global and activity reporting

An ERP for a service company must make it possible to benefit from all the indicators necessary to improve the performance of the company and facilitate decision-making.

Ensure that the following indicators are part of the reporting:

  • utilization rate, staff activity rate, TACI
  • Production in days and value
  • Turnover and margins by project, by department, consolidated
  • Average Day Rates
  • Income statements
  • Cost analysis and invoicing of subcontracting
  • Analysis of time gaps spent by type of activity

You can ask the following questions:

  • How is the time spent on billable projects calculated in relation to the time available?
  • How do you value production?
  • How does the solution differentiate between valued production and turnover?
  • What reports do you make available to check if the pricing is good?

Project invoicing

Centralizing invoicing in the same tool as activity monitoring makes it possible to automate invoicing, make data more reliable, and facilitate the analysis of gaps between production and invoicing.

Important points to see about invoicing:

  • Ability to invoice projects on a fixed price basis, on a management basis, on a subscription basis, etc.
  • Mass sending of invoices by email
  • Customizing invoice templates
  • Monitoring of unpaid debts and automatic reminders
  • Sending billing data to accounting solutions

Questions you can ask:

  • How is invoicing automated with available data?
  • How are unpaid invoices managed?
  • How can I connect an email address to the ERP for sending invoices?
  • How are the gaps between the planned, the product and the invoice analyzed?
  • How is billing data extracted and transferred?

Other useful features

An ERP for professional services companies must centralize a maximum of functionalities to automate the tasks and to exploit the data as well as possible. It is necessary to check the capacities to manage the following functionalities:

  • Expense management and re-invoicing of billable expenses
  • Absence management with connection to HRIS software
  • General purchasing management
  • Management of subcontractor invoicing

Questions to ask:

  • Are expenses managed via a mobile app with data recognition?
  • How is the re-invoicing of costs handled?
  • How do you manage different types of absences?
  • Can we manage purchasing and supplier invoicing?

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2. The major points to study on deployment

The success behind implementing an ERP

The success behind implementing an ERP for a service company lies in the ability of the deployment teams to make the change. Knowledge of use cases and full control of the solution is a key success factor among others.

Key points to know:

  • Quality of support
  • Cost of support
  • Management of imports and migration of historical data
  • Management of user training, administrators, etc.
  • Customization and specific developments

Here are questions to ask about ERP deployment and integration:

  • How is the solution deployed?
  • Are the integration teams internal or external to your teams?
  • What level of support, what time spent by the ERP publisher's teams, and by the client teams?
  • How does the data recovery work?
  • How are connectors set up with other software?
  • What training is carried out before the go-live?

3. Generic points about the company

Its security policy

Finally, choosing an ERP for a professional services company also means choosing a vendor that must demonstrate its ability to maintain the ERP over time and provide the technologies necessary to continue to make it attractive. The ERP vendor must also prove its resilience, its compliance with personal data processing standards, and its actions in terms of cybersecurity.

Points to watch out for:

  • Hosting and localization of customer data
  • Rights and access management
  • GDPR policy and respect for personal data
  • Action to ensure security and prevent intrusion attempts

Questions to ask:

  • Where are your servers located?
  • What data is transferred outside your hosting sites and to which countries?
  • How do you ensure compliance with the GDPR?
  • What protection measures have been put in place: pentests, data encryption, etc. to strengthen security?

Step 3

Get started with the demos and fill out your file

With all these points that you can also complete, you can create specifications, as well as a comparison file.

List all the points that you think are important to review during discussions with suppliers. In the column, list the different ERP vendors you plan to analyze.

Complete the file as the discussions progress, leaving comments to remind you of the answers given on the different subjects.

You can apply a scale with weighting to better classify the different ERP solution providers.

At the end of this work, you should be able to clearly see which solution is best and has the best alignment with your needs.

Our team is here to help you throughout the process if you wish.

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