The organizational decision to replace an ERP system is considered a significant event, one that not only involves many considerations but also has a broad impact on the organization’s activities. We have summarized some characteristics and considerations related to this decision:
Business considerations and motivation: long before technology, business considerations and their prioritization are what lead to the decision to replace an ERP system. Organizations need to investigate and map the total business considerations that generate the motivation to examine such an option. Most of the time, it will be technological gaps that create an ever-expanding challenge between the business needs and the technological ability to provide an effective solution. For example, does the system support multi-sociality, interface with product management processes, the very definition of these gaps is subjective and varies from one organization to another, and therefore deepening is required to gauge its depth. The differences can also be around the cost component, the maintenance, the required investment in personnel throughout the year, regulatory guidelines and the degree of flexibility and ability of the current system to support business expansion.
Challenges and pain points: transparency and internal honesty regarding the capabilities and characteristics of the existing system are critical as a basis for making the decision: organizations must create an open conversation in order to deeply understand the pain points and challenges that are not answered: is there a technological gap? The system’s ability to create interfaces and integrations with external systems? (For example, does the system support multi-sociality, does it provide an integral connection to the WMS, does it support the supply chain processes? The product management processes, and more), is the user experience outdated and not up-to-date? Is the current system simply approaching its End Of Life? Accessibility issues and more.
Technological trends: Another set of considerations regarding the possibility of replacing an ERP system concerns trends external to the organization, which also have technological-business characteristics: the question arises as to the degree of compatibility between the existing system and technological trends and the need for organizations to connect and adapt to them, for example: cloud computing, industry The Open Api’s, open banking, AI, IoT, and more. The inability to connect to such technological trends increases the gap in the business possibilities of the organization, which limits and harms the ability to produce business differentiation in a competitive market.
Deepening, expanding and looking ahead: every organization must ask itself in its daily conduct how it sees itself dealing with technological progress, a competitive and challenging market, changing consumer expectations and a host of other influencing factors that challenge the existing systems. Issues such as the evolution of the ERP systems towards areas of professional specialization, dealing with increasing amounts of data from external sources, the importance of making Data intelligence accessible to the organization’s management, and more, are critical questions in the set of considerations. On the other hand, the farther you get from plain vanilla, the more complex and dangerous it is to upgrade. The entry of most organizations into the upgrade process only as a result of the need to deal with its End Of Life risks complex, long and of course – expensive projects.
Faced with the variety of these questions, considerations and meanings, it is not for nothing that many organizations are looking for professional and experienced parties who can accompany them in this complex and sensitive process. This is exactly one of the value propositions that we at Strauss Strategy offer to organizations: to assist in formulating an informed and well-founded decision as to whether it is right to upgrade the ERP system, how to make the transition (when, in what execution method, in what configuration and a road map for full implementation).
Our experienced team of experts will be happy to assist and hear about your specific needs and challenges in order to adapt a dedicated process tailored to the organization’s dimensions.
