Important Considerations When Replacing Your ERP System

Posted by James on July 26, 2016 at 3:00 PM
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Last week in her Sue's Views blog, Sue wrote about making your current Sage Enterprise Resource Planning system work harder for your company. Indeed, there are almost always improvements that can be made to familiar software. Yet sometimes the needs of a business change in ways that an existing ERP system can simply no longer accommodate without extensive - and expensive - customization and third-party applications bolted on. Eventually, all of those non-native components and their required maintenance take a toll on your system and, consequently, on your organization's bottom lineFrom production planning, to purchasing, to supply chain strategy, if your ERP system isn’t performing smoothly, then every aspect of your business will feel the pain.

So how exactly can you tell when it's time to make a change? And if that time comes, how might the cloud computing revolution influence your decision-making process? Two upcoming posts on the B/P Impressions blog will be dedicated to providing information on these topics.

Deciding to Replace Your ERP System

In a nutshell, your ERP system is doing your business a disservice if it doesn't increase the efficiency of your processes; if you spend an unwelcome amount of time and money just trying to make it facilitate your company's most fundamental tasks. In the first part of this short series, we'll address the warning signs of an ERP system nearing its expiration date...

  • It fails to support business needs (e.g. lacks needed functionality, is hard to use, responds slowly).
  • It's operating costs are already too high - and going up!
  • You rely on spreadsheets more than your system's data to get things done.
  • Executives receive poor or no insight from the system (e.g. lack of intuitive dashboards and self-service business intelligence).

...and then we'll investigate how a new ERP system might make life better...

  • Increase sales and improve customer service
  • Improve cash management and reduce outstanding receivables
  • Increase efficiency to reduce purchasing and production costs
  • Improve inventory turnover
  • Better utilize people, equipment, and materials

Moving Your ERP System to The Cloud

For the second part, we'll assume that a new, dynamic ERP system is in your company's future. In today's digital landscape, however, that decision invites a related question: Should your new system live physically at your site or be hosted in The Cloud? On-premise and cloud deployments each have benefits and limitations, and the period just before system replacement is an opportune time to weigh them. The right solution for your organization will depend on numerous factors and preferences. We'll consider elements like...

  • The relationship between deployment and your Information Technology group
  • The timing of deployment decision-making
  • Potential cost impacts
  • The influence of Human Resources
  • Comprehensive strategy

The performance of your Enterprise Resource Planning System goes hand-in-hand with the performance of your business. In the long run, you'll set your company up for success by ensuring that you have the right system for your business implemented in the most advantageous way possible.

Topics: ERP Selection

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