Checklist: before you sign an ERP or CRM implementation contract

An ERP or CRM project usually goes wrong long before go live. It goes wrong in the contract, when scope is described as "Sales, Purchase, Inventory and Accounts modules" and both sides read that sentence differently. Six months later you are arguing about whether a dealer scheme calculation was included.

Use this checklist with your vendor and your own legal advisor before you sign. It is not legal advice, and some points will matter more to you than others.

Scope

• Is scope written as business processes, such as quote to cash, procure to pay and month end close?
• Are your key scenarios listed, with real examples? For instance, "a dealer order with a quantity scheme, partial dispatch from two warehouses and a credit note for breakage".
• Are reports and print formats listed by name, including GST invoices, delivery challans and statements?
• Are integrations listed, with the system on each side and the direction of data? Tally, payment gateway, WhatsApp provider, GST e-invoicing, bank, e-commerce.
• Is there a written list of what is out of scope?
• Is there a change request process, with how changes are estimated, approved and priced?

Data migration

• Which data will be migrated: masters only, open transactions, or history? How many years?
• Who cleans the data? This is usually your team, and it is usually underestimated.
• How many trial migrations are included before the final one?
• How will migrated balances be reconciled and signed off, for example stock and ledger balances against the old system?

Licences and costs

• Are licence counts, types and editions stated, with the price for adding users later?
• Is annual maintenance or subscription stated, with the basis for yearly increases?
• Are hosting, backups and environments such as test and production included, and who pays for them?
• Are third party costs, such as WhatsApp messaging, SMS, telephony and GSP charges, called out separately?
• Is the total cost over three to five years visible on one page?

Acceptance and payment

• Are payments linked to milestones you accept, such as a working process tested on your data?
• Is there a written acceptance test for each milestone, with who signs off?
• What happens if acceptance fails: how long to fix, and at whose cost?
• Is a portion of the fee held until a period of stable use after go live?

People

• Are the vendor's key people named, with a limit on how often they can be replaced?
• What time is expected from your team, by role, each week? Is it realistic alongside their day jobs?
• Who on your side has authority to approve scope and changes?

Training and go live

• How many users will be trained, in what language, and in what format?
• Are user guides and short videos included, in the language your team uses?
• How long is hypercare after go live, and what response times apply during it?

Support after go live

• What are the support hours, channels and response times by severity?
• Who handles statutory updates, such as GST schema changes or payroll rule changes, and is that included?
• How are upgrades to new versions handled, and are your customisations protected?

Ownership, data and exit

• Who owns custom code written for you? Will you receive the source code and documentation?
• Is your data yours, exportable at any time in a usable format, at no extra charge?
• If the contract ends, what help will the vendor give to move to another provider, and at what rate?
• Where is data hosted, and does the vendor act as a data processor under the DPDP Act 2023, with a written agreement covering security, breach notification and deletion?

A final check

Ask the vendor to walk through your three hardest scenarios before signing. If the answer to any of them is "we will handle that during implementation", get it written into scope with an estimate. Vague promises at the sales stage are the most expensive line in any implementation contract.

Code Colonies also reviews implementation contracts and scopes as a short, fixed scope piece of work, paid after you accept the review, whether or not we carry out the build.