Choosing the Right ERP for Life Sciences: 5 Key Considerations for Seamless Growth

Selecting an ERP system is a significant decision for any organization, but the stakes are especially high in the life sciences industry. You’re likely already managing a vast array of regulatory requirements, balancing scalability demands as you grow and contending with the challenges of integrating various tools and software systems to meet your complex needs. Choosing the right ERP solution for your life sciences organization can set you on a smooth path toward growth or, if done poorly, create more hurdles than it solves.

A recent webinar on ERP selection highlighted the importance of identifying solutions specifically tailored for life sciences companies. These solutions must accommodate the industry’s unique challenges, from ensuring compliance with regulatory standards to managing the intricate details of multi-entity, multi-location operations.

Below, we’ll walk through five key considerations to help guide your software selection and provide a solid foundation for your organization’s future growth.

1. Understanding Software Options and Business Requirements

When it comes to picking an ERP system for life sciences, there’s no one-size-fits-all solution. The industry is a beast of its own, with tons of moving parts like regulations, growth spurts, and keeping track of every penny and process. To make sure you choose a system that works for your unique setup, here are a few things to think about:

• Keeping Regulators Happy: Life sciences means dealing with big regulatory bodies like the FDA. Your ERP system should have tools to make compliance a lot less painful, whether it’s managing audits, tracking quality standards, or staying ahead of the latest rules.
• Room to Grow: Are you just getting started, knee-deep in clinical trials, or gearing up to commercialize? Wherever you are on the journey, your ERP needs to grow with you. It should be able to handle more transactions, juggle multiple locations, and support you as you expand globally.
• Handling the Basics: At its core, your ERP should make life easier. Think better financial reporting, smoother workflows, and easier approvals. Plus, it needs to handle all that tricky stuff like managing spending, consolidating accounts, and juggling intercompany transactions.
• Custom Fits for a Custom Industry: Life sciences companies are anything but cookie-cutter. From R&D expenses to clinical trial costs, you need an ERP that can adapt to your unique processes without breaking a sweat.
• Playing Nice with Other Tools: Let’s face it, no ERP can do everything. That’s why it’s important to find one that works well with the systems you already use, whether it’s for procurement, quality management, or analyzing data. A good ERP ties it all together, so your team isn’t stuck playing tech support.

At the end of the day, it’s about finding an ERP that works for you—not the other way around. Pick something that simplifies your day-to-day, keeps you compliant, and is ready to roll as you grow. After all, the right ERP can be a game-changer, not just another headache.

2. Knowing When to Transition from QuickBooks to a Comprehensive System

QuickBooks is often the go-to financial software for many life sciences startups due to its simplicity and low cost. However, there comes a time when QuickBooks may no longer be sufficient to meet your needs. Here are some signs that it might be time to transition to a more comprehensive software solution:

• Increased Transaction Volume and Operational Complexity: As your organization grows, so does the complexity of your financial processes. When your volume of transactions starts overwhelming QuickBooks, causing delays or inaccuracies, it’s a strong indicator that a more advanced system is needed.
• Multi-Entity or Multi-Location Requirements: Many life sciences organizations operate across multiple entities or locations, requiring a platform that can support these configurations. QuickBooks struggles in this area, as it wasn’t designed to handle the complexities of multi-entity or multi-location operations.
• IPO Preparation: If your organization is considering going public, accurate financial reporting and strong internal controls become paramount. A more sophisticated platform can provide the level of detail and compliance required for IPO preparation, ensuring your financial data meets the standards expected by investors and regulators.

These indicators are crucial in helping you determine the right time to make the leap to a full-scale solution that will support your organization’s goals and growth trajectory.

3. Third-Party Integrations for Enhanced Functionality

An ERP system may provide robust capabilities for your core needs, but in life sciences, there are often unique functions that require specialized tools. This is where third-party integrations come into play. Here are some commonly needed integrations for life sciences companies:

• Procurement: Many companies rely on procurement systems such as Prendio and Coupa, which help streamline the purchasing process, from requisitions and approvals to purchase orders and vendor management. For life sciences organizations, procurement systems are particularly helpful in ensuring compliance with purchasing guidelines.
• Expense Management: Managing expenses can be a significant challenge, especially for companies that need to track costs associated with R&D, clinical trials, and travel. Tools like Expensify and Concur simplify expense reporting, helping you ensure compliance with industry regulations.
• Quality Management Systems (QMS): Compliance with quality standards is crucial in life sciences. A QMS can be integrated with your ERP to ensure consistent quality across production and supply chain processes. This integration enables better tracking and reporting, ensuring you meet FDA and other regulatory standards.

Each of these third-party tools complements the core system capabilities and provides the specialized support many life sciences organizations need as they expand.

4. Budget, Timeline, and C-Level Support

Implementing a comprehensive management solution is a significant investment, not just financially but also in terms of time and resources. To ensure success, it’s essential to establish realistic budgeting, timelines, and project milestones upfront.

Budget considerations include the software cost, implementation fees, and any third-party integrations you’ll require. Establishing a clear timeline helps keep the project on track and minimizes disruptions to your business operations. Equally important is securing C-level support for the initiative. Executive backing, particularly from finance leaders, can drive the initiative forward and keep the team aligned with the organization’s strategic goals.

5. Future-Proofing Your Software Investment

Selecting a platform that meets your current needs is crucial but choosing one that can grow with you is equally important. Scalability and adaptability are key to ensuring your solution remains valuable as your organization evolves.

• Scalability: As your organization grows, so does the demand on your management software. A scalable solution, like NetSuite, can expand with your business, supporting increased transaction volumes, more complex reporting requirements, and additional entities or locations. This scalability is especially important for life sciences companies that experience rapid growth during product development and clinical trials.
• Adaptability: The life sciences industry is constantly evolving, and your software must be able to adapt to these changes. Whether new compliance standards emerge or you need to integrate the latest technology, an adaptable solution can keep pace with these shifts, ensuring long-term relevance.

Future-proofing your investment is a strategic decision that can save you from costly upgrades and disruptions down the line, positioning your organization for sustained success.

Next Steps: Setting the Stage for Long-Term Success

Choosing the right solution for a life sciences company is a strategic decision with a lasting impact. By carefully considering your options, understanding the right time to transition from QuickBooks, identifying necessary integrations, budgeting realistically, and planning for future growth, you’re setting up your organization to align its software with your business goals. Each of these considerations plays a key role in selecting a system that not only meets today’s needs but also scales with your company as it evolves.

As you move forward, keep in mind that a successful journey doesn’t end at selection. Implementing the system is the next critical phase, and it requires just as much planning and attention to detail. In our next post, we’ll walk through the implementation process specifically for life sciences, covering essential steps to ensure a smooth rollout and set your team up for success right from the start. Stay tuned for practical insights to guide your organization through each phase of the journey, or contact us to schedule a customized NetSuite demo when you’re ready to see it in action.