Many mid-sized organisations today have an ERP system of some description. Some are more sophisticated than others, some still do a good job, while some have completely stopped being able to keep up with the business demands.
This last point is particularly relevant as business growth can leave a poorly planned ERP implementation lagging behind and no longer able to deliver value to the business. Typically, this can lead to stop-gap measures with multiple databases, work-arounds and custom applications filling the void. In turn, this creates complexity, duplication of data and makes it difficult to make reliably informed business decisions.
In addition, with businesses demanding greater value from new applications, social engagement, mobility and real time dashboards, these disparate environments become almost impossible to maintain. If this is the case, it’s probably time to upgrade or replace the ERP system. So where to start? There are a number of key points to consider.
1) Evaluate the situation now and tomorrow
It’s important to consider not just the business requirements today, but what they are likely to be in five or 10 years’ time. For instance, if new product lines are anticipated that will require more advanced scheduling, then it’s important to consider the ease of adding scheduling modules to your ERP system down the line.
Some big ERP implementations take so long to implement that the business requirements change several times throughout the process (which requires costly and time consuming changes to the project). Choose an ERP system which offers flexibility, but is also designed for your industry. It might seem obvious, but if your core business is in service delivery, ensure that the ERP solution isn’t focused on distribution with service added on. There are many ERP systems available and it’s important to match the core strength of the system with that of the business.
3) Deployment type
The cloud is creating an enormous amount of hype and there is no doubt that in some situations it can deliver great value – reducing the need for new servers and an expensive IT environment. But, don’t neglect the need to customise and integrate that system to your environment; consider the full cost of the solution, not just the monthly subscription.
While an ERP system is the central hub for all business information, there are many other applications and business processes that will need to integrate with it. Processes like logistics management, scheduling, warehousing, HR, CRM, online sales and so on should all be integrated into a single ERP system to ensure there is a single version of the truth.
Many ERP applications attempt to deliver everything from WMS, CRM, SCM to advance planning and even scheduling. But there is a market for these products, so it is very likely that a one-size-fits-all ERP system is not the best if you are looking for first class applications in each area. When building a best of breed solution, the ease of integration between different applications is crucial. Infor uses open standards aligned with SOA and Web Services to provide a proven way to interface other applications with the ERP hub.
Upgrade vs a new system
On the face of it, an upgrade can seem less complicated and time consuming than a brand new implementation. However, if the business has changed significantly or the application has been heavily modified, it is likely that a new implementation will be easier, deliver greater value and be more cost effective in the long term.
The right ERP system implemented well and in line with the business strategy and growth plans will deliver value and ROI for many years to come.
Get it wrong and you can have a very expensive failure on your hands. It’s not a decision to take lightly, so ask the hard questions and ask for customer references.