ERP selection criteria are the weighted factors you score every candidate system against: process fit, total cost of ownership, integration, reporting, scalability, security, usability, the supplier's delivery capability and your exit options. Agree the weights before any demo, score every option the same way, and test the top two with scripted demos and reference calls.
Most selection mistakes come from scoring after the demos rather than before. A polished presentation shifts opinions; a scorecard agreed in advance keeps the decision tied to your requirements. This checklist works whether you are comparing packaged suites, a package against a custom build, or two development partners. For a fuller comparison of the buy versus build question itself, see ERP vs custom development. If your shortlist includes a system designed around your own processes, our custom ERP software page explains how that is delivered.
What criteria should you use to select an ERP?
Use nine criteria, weighted for your business. The first two usually carry the most weight because they decide whether the system will actually be used and whether you can afford it over its life.
| Criterion | What to assess | Example evidence |
|---|---|---|
| Process fit | How well core processes run with standard functionality or the proposed build | Scripted demo results, gap list |
| Total cost of ownership | Licences or build, implementation, integrations, hosting, support, upgrades, internal time over several years | Itemised cost model per option |
| Integration | Connections to e-commerce, banking, payroll, CRM, logistics, BI | Documented APIs, integration plan |
| Reporting and analytics | Standard reports, custom reports, dashboards, data export | Your top ten reports built in the demo |
| Scalability | Users, entities, currencies, transaction volumes, new sites | Reference customers of similar size |
| Security and access control | Role-based permissions, audit trail, single sign-on, data location | Security documentation, permission demo |
| Usability | How quickly a key user can complete a daily task | Hands-on trial by your staff |
| Delivery capability | Experience, team, method, support model of the implementer or developer | References, named team, sample plan |
| Ownership and exit | Data export, contract terms, who owns custom code and configuration | Contract clauses, export demo |
Our guide to ERP total cost of ownership explains how to build the cost line so options are comparable.
How do you build a weighted ERP scorecard?
Give each criterion a weight that adds up to 100, score each option from 1 to 5 against written definitions, then multiply. Agree weights and score definitions with the sponsor and process owners before the first demo.
ERP scorecard template (illustrative weights)
The weights below are an example for a mid-sized distributor. Change them for your business.
| Criterion | Weight | Option A score (1 to 5) | Option A weighted | Option B score (1 to 5) | Option B weighted |
|---|---|---|---|---|---|
| Process fit | 25 | 4 | 100 | 3 | 75 |
| Total cost of ownership | 20 | 3 | 60 | 4 | 80 |
| Integration | 10 | 4 | 40 | 3 | 30 |
| Reporting | 10 | 3 | 30 | 4 | 40 |
| Scalability | 5 | 4 | 20 | 4 | 20 |
| Security and access | 10 | 4 | 40 | 4 | 40 |
| Usability | 10 | 4 | 40 | 3 | 30 |
| Delivery capability | 5 | 4 | 20 | 3 | 15 |
| Ownership and exit | 5 | 5 | 25 | 3 | 15 |
| Total | 100 | 375 | 345 |
Define what each score means. For process fit, for example: 5 means the full process runs without workarounds, 3 means it runs with a documented workaround, 1 means it cannot run without major development. Written definitions stop scores drifting between evaluators.
How should you run ERP demos?
Run scripted demos, not vendor presentations. Send every shortlisted supplier the same scripts in advance and ask them to show those processes, with your sample data, in the order you set.
Demo script checklist
- Send three to six end-to-end scenarios at least two weeks before the demo
- Include your own sample data: real item codes, customer types, price rules
- Include one awkward case per scenario: a partial delivery, a credit hold, a return, a multi-currency invoice
- Ask to see one of your must-have reports built live or shown from a working system
- Ask a key user to try one daily task themselves
- Ask to see how a user's permissions are set and how the audit trail records a change
- Ask how the configuration or code shown would be maintained and upgraded
- Have each evaluator score immediately after the demo, before discussing
A typical scenario reads: "Receive an order for 40 units where only 25 are in stock; ship 25, back-order 15, invoice the shipment, and show the customer's open balance." It tells you far more than a tour of menus.
What should you ask ERP references?
Ask references about delivery, not just the software. Choose references of similar size and industry, and ideally ones the same implementation team worked on.
- What was in scope, and was it delivered as agreed?
- How were change requests handled?
- How did data migration go, and how many trial loads did you run?
- What happened in the first month after go-live?
- Who from the supplier team is still involved, and how responsive is support?
- What would you do differently?
- Do you own your configuration, custom code and data, and could you move away if needed?
What are the red flags when choosing an ERP?
Some answers should lower a score sharply, whatever the demo looked like.
- The supplier will not run your scripts and insists on its standard presentation
- Fixed timelines or costs are quoted before any discovery
- Key processes are shown on slides, not in a working system
- Every gap is answered with "we can customise that", without explaining the upgrade impact
- References are all from different industries or much smaller companies
- The contract is unclear on who owns custom code and how data is exported
- The team presenting is not the team that will deliver
- Integrations are described as "standard" without documentation
Should integration and architecture be scored separately?
Yes, if the ERP must connect to several systems. Integration effort is often the largest hidden cost and risk. Ask each option how it exposes data (APIs, files, events), how failures and retries are handled, and who maintains each connector. Our guide to system integration approaches explains the options to compare.
How do you score a package and a custom build fairly?
Use the same criteria and weights, but ask for different evidence. A package proves process fit through a scripted demo of standard functionality. A custom option cannot demo software that does not exist yet, so ask instead for a solution design for your scripts, a phased delivery plan, examples of comparable systems the team has built, and, where possible, working pilot modules for one or two of your scenarios.
| Criterion | Evidence from a package option | Evidence from a custom option |
|---|---|---|
| Process fit | Scripted demo, list of gaps and workarounds | Design for each script, pilot modules where available |
| Total cost of ownership | Licences, implementation, extensions, upgrades over several years | Build by phase, hosting, support and change budget over several years |
| Ownership and exit | Data export, ownership of configuration and extensions | Source code ownership terms, data ownership, documentation |
| Delivery capability | Partner references for this product | References for comparable custom systems |
| Future change | Vendor roadmap, upgrade impact of extensions | Your control over the roadmap; cost of each change |
Be wary of two common biases. Teams tend to overrate a package because it is visible and underrate the cost of its gaps; they can also overrate a custom option because it promises everything. Scoring both against the same scripts and written definitions corrects for both.
Who should be on the ERP selection team?
The sponsor sets weights with process owners; process owners and key users score fit and usability; finance scores cost; IT scores integration, security and architecture. If you bring in outside help, check its independence: our comparison of an ERP consultant versus an ERP development company covers the trade-offs.
When is a formal scorecard overkill?
For a small business replacing basic accounting with one well-known package, a full scorecard may be more process than the decision needs. A short list of must-haves, a hands-on trial and two reference calls can be enough. The weighted approach earns its effort when several departments are affected, when options differ in kind (package versus custom), or when the investment and switching cost are high.
ERP selection checklist
- Business goals and in-scope processes written down
- Nine criteria agreed, weights set and signed before demos
- Score definitions written for each criterion
- Shortlist limited to options that pass your must-haves
- Demo scripts and sample data sent to every supplier
- Each evaluator scores independently after each demo
- Cost model built on the same basis for every option
- Reference calls completed with similar companies
- Contract checked for ownership, data export and exit terms
- Decision recorded with the scores and reasons
How to start your ERP selection
Turn your requirements into a document suppliers can respond to: our ERP RFP template gives the structure and a scoring section that matches this scorecard. Then discuss the project with us if a custom or partly custom system is on your shortlist. Timeline Digital builds 2 to 3 key modules as a free pilot before the full project starts, which gives you working software to score instead of a demo.