CFO’s ERP Selection Guide for the Chemical Industry

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The chemical industry is a complex and challenging one. Not only does it require a great deal of technical and theoretical know-how, but it is also strictly regulated in line with a long list of rules pertaining to safety and the environment. Under these circumstances, chemical businesses have a lot of work on their hands as they try to run successfully and compliantly. Due to the nature of the industry, businesses need a highly efficient Enterprise Resource Planning (ERP) system to help them navigate the many intricacies involved with their work. The question is, how to choose the best ERP solution from among the many available options? As you vet the various solutions, you need to consider multiple layers of complexity as you seek the best ways to manage staff, product output and compliance. Follow this ERP selection guide to help you make the best choice.

Challenges for the Chemical Industry

As a business owner in the chemical industry, you need to navigate strict health and safety regulations, environmental limits and targets, fluctuating fuel and energy costs, equipment maintenance, operational costs, logistics, human resources, and more. You will need an ERP solution that brings all of these challenges into its purview through a full suite of planning and management functions: material management, finance and accounting, shipping and receiving, planning and production, customer service, sales, marketing, and company leadership roles, and more. It is not advisable to try using a one-size-fits-all solution for a chemical enterprise. You will need something that is scalable, customizable, and comprehensive.

Conduct a Scalability Test

After you have drawn up your list of requirements in terms of the various challenges you face in the industry, your next step is to start thinking beyond your immediate circumstances. As your business grows, your ERP system should be able to adapt to your changing needs. Some ERP systems are more scalable than others, so choose one that suits your projected future needs. 

Determine the Need for Third-Party Integrations

Chemical ERPs are specifically designed for the industry, but there are many instances where companies will need greater control over their ERP. If the solution is not sufficiently customizable, you will likely be forced to integrate third-party components in order to carry out your various functions. The more third-party solutions you need to include, the slower and less efficient your system will become. Too many add-ons also make your system less user-friendly and more confusing – especially when it comes to training new team members. Consider, ahead of time, the ERP’s flexibility, how many third-party add-ons you may need, and how it will affect the system. 

Investigate Product Support

Product support is an important part of an enterprise-wide system like an ERP. You will certainly need help with set-up and launch, but you may also require ongoing product support going forward. Find out what support your vendor offers. Is there unlimited support over the phone, or perhaps a variety of packages featuring phone and chat services for a fixed monthly fee? Find the solution with the support service that best suits your enterprise.

Check Technology Requirements

The technological prerequisites of the solution should match your business’s technological infrastructure and preferences. You may want to work via cloud technology, for example, or you might want to deploy your solution on the premises. You might have an in-house IT team who will manage the infrastructure for you, or you may need to outsource this function. Whichever choice you make will depend on your current resources, and will also determine current and future changes to your infrastructure and staffing decisions. 

Review Your Long-Term Budget

Be careful not to think only about the upfront costs of your ERP. Consider long-term expenses, such as maintenance, the cost of updates and expansion, and the training and onboarding of employees. Your chemical ERP should reflect your long-term plans, and it is, therefore, essential that you also consider the costs involved with carrying out those plans.

Consider Mobile Requirements

No business can ignore mobile technology. Remote operations are common across all industries. Your ERP should be able to accommodate mobile operations, giving key staff members – such as sales and logistics workers the freedom and flexibility to leave their desks and work effectively from wherever they are. ERP dashboards are becoming increasingly mobile-friendly, often featuring apps and add-ons specifically designed for mobile devices. Whatever your business’s mobile requirements may be, ensure that your ERP can facilitate them.

Questions to Ask About Measurements, Potency, and Multiple Package Units

As you weigh up your ERP options, ask yourself and the vendor the following questions to help you make the best choice. Aside from overall management and compliance requirements, your ERP system must also be able to handle the functions specific to the various functions of the chemical industry. It should handle multiple units of measure and be able to convert between weight, density, and volume accurately. It should have the capacity to facilitate purchases, receiving, shipping, and sales in any unit of measurement. Narrow down your search for a successful solution by asking the following measurement-specific questions.

 – Does the ERP system provide the capability to track and display inventory quantities in multiple units of measure simultaneously?

 – Does the ERP system provide the capability to buy/receive and sell/ship in any unit of measure with accurate conversions?

 – Are formula-based unit of measure conversions supported?

 – Are multiple packaging units of measure for each product/part code supported?

Sage X3 for the Chemical Industry

Sage X3 is the ideal ERP solution for the chemical industry. It helps you respond quickly to changing market conditions and improve purchasing, production, and shipping functions. It provides the flexibility to act on all business opportunities, ensuring that the available technology verifies the quality, safety, and efficacy of your products. With Sage X3, you never need to worry about compliance requirements. The system supports all the complex global laws and restrictions that govern the chemical industry. It simplifies compliance across currencies, regions, and regulations. Sage X3 can also be deployed rapidly and managed easily, supporting web-based management capabilities through any connected device. Panni Management provides flexible, comprehensive, and customizable ERPs for the chemical industry. Having read this ERP selection guide, contact us to find out how we can optimize your production and compliance processes with Sage X3.

Transforming businesses since 2009

For over a decade, Panni has helped companies transform their businesses to lead, innovate and be profitable. With the right combination of technology and experienced developers and consultants, we help companies with Change Management to achieve the organizational objectives. We believe in long-term relationships with our clients and provide top-notch support with fast turnaround times.

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