Are you considering replacing your enterprise resource planning (ERP) system? Selecting and implementing a new ERP solution is not a small undertaking and making the right decision involves not only understanding the available solutions but also how they will interact with dozens of solutions at your hospitals and how they will impact the efficiency of staff across the organization. Properly implemented, a new solution can streamline business processes, improve decision making, and create significant savings. Making the wrong choice, or implementing poorly, can lead to the loss of millions of dollars and tens of thousands of hours of effort.
ERP is a critical system for healthcare organizations, encompassing Financials, Supply Chain, and Human Resources functions. Financials allow the hospital to manage their money and understand their financial position. Supply Chain manages the supply needs of the organization because having the right product at the right place at the right time can be a life and death issue in our industry. Human Resources manages the people and talent of the organization and can be critical to properly paying and rewarding staff.
In this blog series, we will discuss the process to engage in the organization in an inclusive, but efficient software selection for ERP, allowing for the right decision to be made and creating excitement in the organization for the upcoming change.
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Why do a System Selection?
Many hospitals question if they need to do a system selection, suggesting that they know what they want based on prior experience or based on the solutions that they have seen at conferences. However, those hospital leaders are missing an opportunity and increasing the risk associated with the project. Why? Simply because they do not know what they do not know. Applications change from year to year and the market is continuously evolving. Prior experience may not be reflective of the current environment.
Also, it is vital to the success of any large project that there be strong buy-in from staff. One of the best ways to accomplish this is to involve a broad cross-section of impacted staff in the selection process, resulting in ownership of that decision and a desire to see success during implementation.
Managing an Effective System Selection
The first step in the system selection process is to determine the team that will have input into the decision. Selecting a neutral facilitator to lead a system selection will help to ensure that personal bias and experience do not overtake objective review – and ensure that the project is propelled forward as the staff has conflicting priorities. The selection team should include a primary selection committee including the final decisions makers for supply chain, IT, human resources, finance, and other impacted areas. Sub-committees for each area, or module of the software, can be formed to do deeper dives into the functionality during demonstrations and make recommendations for their areas.
Issuing the RFI or RFP does not need to be a lengthy process. RFP’s that include endless lists of functions with checkboxes do not help the hospital and are frustrating to vendors. The reality is that the vendors that are working with hospitals all the time know very well what functionality hospitals need – in many cases better than the hospitals. Instead, use the RFI as the chance to tell your story, what you are trying to accomplish, and what you are looking for in a software partner. Encourage them to respond by expressing how they can help – what functionality they offer, and how they approach partnerships with hospitals.
Unfortunately, it's not uncommon for software vendors to try to influence decision-makers during the process – buying lunches and dinners, giving away promotional items, even offering trips to visit reference clients in Hawaii. Running a process free of this type of influence is not about being fair to the vendors – it is about being fair to the hospital to make sure the decision is entirely based on the software’s ability to help the hospital meet its goals. Establishing strong rules of the road for the selection process and ensuring all vendors and staff follow it is important to make the right decision.
Demonstrations
Vendor demonstrations are often the most critical part of the selection process, as each shows off their functionality and tells the story of how the hospital will operate in the future if they are chosen. Vendors should be encouraged to show the software in a way that makes sense for them – requiring scripted demos removes the ability to truly understand how the software flows. However, vendors should be challenged during demonstrations to make sure you are getting the complete story. During demonstrations, throw the vendor off their practiced path by asking questions about what they are not showing you. Also, require that all software that is demonstrated be released and part of what they are proposing – or require they specifically call-out anytime that is not the case.
Notice other factors in demonstrations as well. How many team members does the vendor bring to do the demo? If the demo is passed from person to person, it may indicate that the software is complicated and that no one person can understand it all. A smaller number of people suggests simplicity. Does each member of their visiting team add value, or are some there just for show? Do they challenge your organization to think differently and suggest best practices? Do they have a clear methodology for implementation? Do they tell you what they can do, or do they show you?
Just as with scripted demonstration requests, scoring sheets take all the creativity out of the selection process. Printed score sheets in a demo with staff writing in numbers while they present can be one of the most frustrating experiences for demonstration staff as they try to adjust their demonstration approach to “teach to the test.” Software selection is not about one particular feature or function – it is about the overall workflow and experience. Instead, do post-demonstration surveys focused on letting each participant expand on what they liked and didn’t like – what they want to know more about, and what concerns they have. In the end – would you choose a multi-million-dollar system based on a score, or based on what the staff believes is the right answer?
Making a Decision
When making the final decision, encourage committees to meet, discuss, debate, and vote. Require votes to be “on the record” and encourage staff to try to build consensus. Have each subcommittee write up their recommendation and share it with the selection committee to use in their final decision process.
In the end, it’s unlikely that everyone will get what they want. However, by including them in the process, they will have been part of the decision and will be going into the implementation process with clear concerns that can be addressed by the implementation team. By following this process, the hospital leadership will have made the decision together, and will then be prepared to embark on the implementation journey.
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