Let´s change ERP!

When you work dai­ly with dif­fer­ent cus­tomers and part­ners with ERP-relat­ed issues, devel­op­ment and chal­lenges, you get a feel for where ERP (Enter­prise Resource Plan­ning) devel­op­ment and pro­cure­ment are going in the Finnish market. 

The rea­sons for renew­ing an ERP are often strate­gic, busi­ness, or tech­ni­cal. Some com­pa­nies are look­ing for effi­cien­cy and com­pet­i­tive advan­tage in their indus­try by switch­ing to ERP, for oth­ers the key rea­son is to move to the cloud. Often there is a desire to get rid of ERP that is over 20 years old and its “repair debt”, and update old, com­plex and cus­tomized process­es to sim­pli­fied, “best prac­tice” process­es in the indus­try. At the same time, the com­pa­ny is usu­al­ly freed from the “ven­dor lock” that may arise if the com­pa­ny’s old ERP can only be main­tained by one supplier.

Regard­less of tech­nol­o­gy, com­pa­nies using lega­cy ERP solu­tions have a lot of lim­i­ta­tions to wor­ry about. In the next 3 years, com­pa­nies will be forced to mod­ern­ize their ERP envi­ron­ment, as their tech­nol­o­gy has become obso­lete in many respects to an unbear­able state. Their com­pat­i­bil­i­ty is lim­it­ed, the pace of devel­op­ment is slow and expen­sive, and inte­gra­tion with oth­er key sys­tems is not pos­si­ble. This results in silos. Shar­ing infor­ma­tion between busi­ness­es oper­a­tions is dif­fi­cult, and ana­lyt­ics does not serve the com­pa­ny’s man­age­ment in real time. Detect­ing this sit­u­a­tion requires the com­pa­ny’s man­age­ment and own­ers to be able and com­pe­tent to under­stand what ben­e­fits and com­pet­i­tive advan­tages dig­i­tal trans­for­ma­tion would bring in their own oper­at­ing environment.

Anoth­er impor­tant fac­tor and rea­son for mod­ern­iz­ing ERP is data secu­ri­ty, because if the old secu­ri­ty pro­to­cols no longer pro­tect the com­pa­ny, it is vul­ner­a­ble to data leaks and cyber­at­tacks. Sim­i­lar­ly, sup­port for cur­rent secu­ri­ty stan­dards (eg. GDPR) may be miss­ing. There are numer­ous exam­ples of what can hap­pen to a com­pa­ny at worst. Old solu­tions sim­ply don’t match world-class tech­nol­o­gy providers when it comes to secu­ri­ty development.

Anoth­er impor­tant fac­tor to con­sid­er is the abil­i­ty of tech­nol­o­gy ven­dors to pro­vide sup­port (and devel­op­ment) for lega­cy ERP plat­forms. Sup­pli­ers will either be forced to with­draw the sub­sidy by the dead­line and/​or sig­nif­i­cant­ly increase the cost of the sys­tem. Sit­u­a­tions arise where, due to lack of invest­ment capac­i­ty, a com­pa­ny is either forced to use old ERP or pay sig­nif­i­cant main­te­nance and devel­op­ment costs at the end of the ERP’s life cycle. At the same time, these com­pa­nies are lag­ging behind as oth­er com­pa­nies in the indus­try adopt mod­ern inno­va­tions includ­ed in new ERPs, such as AI, process automa­tion, mobile solu­tions, IoT and ana­lyt­ics. Let’s also remem­ber that keep­ing ERP experts in the com­pa­ny to main­tain the old ERP is a rea­son­able per­son­nel risk for the company.

New mod­ern ERPs almost “sell them­selves” with their ben­e­fits and fea­tures. They’re cloud-based, high-per­for­mance, user-friend­ly, high­ly inte­grat­ed, scal­able, include real-time ana­lyt­ics, and updates and sup­port ser­vices include things like ongo­ing main­te­nance of impor­tant secu­ri­ty, among oth­er things. Lead­ing tech­nolo­gies can be devel­oped and main­tained by a wide range of sup­pli­ers and integrators.

Com­pa­ny’s man­age­ment must under­stand what it is aim­ing for when it wants to improve the com­pa­ny’s agili­ty, effi­cien­cy and process­es. It should define the needs and goals of the ERP project based on the busi­ness strat­e­gy, as well as eval­u­ate the pro­jec­t’s busi­ness ben­e­fits and return on invest­ment. Often at the begin­ning of the project, the key chal­lenges of the cur­rent state and bot­tle­necks are also mapped out, which will be solved lat­er in the project. It is impor­tant to under­stand in good time what kind of com­pe­tence the com­pa­ny needs in the tar­get state of devel­op­ment and to define the inter­nal own­er of the project and oth­er key per­sons in the com­pa­ny. Often, recruit­ment has to be resort­ed to due to lack of skills or time. Man­ag­ing an ERP project is a full-time job.

At Islet, we are experts in ERP trans­for­ma­tion, with world-class SAP tech­nol­o­gy and solu­tions. We offer ser­vices from ERP project kick­off to imple­men­ta­tion and con­tin­u­ous main­te­nance ser­vices. We have skilled and expe­ri­enced archi­tects, con­sul­tants and project man­agers, as well as Islet’s top man­age­ment always involved in a client project. Con­tact us – We han­dle all conditions!

#ERP #SAP #S4HANA #blog #ERP­Trans­for­ma­tion #Enter­pris­eRe­sour­ce­Plan­ning