When organizations with outdated ERP systems witness demonstrations of contemporary ERP software available today—ones that are user-friendly, adaptable, flexible, and potent—it frequently triggers discussions around the necessity for a new ERP system.
Prominent ERP providers have dedicated efforts to facilitate the transition to their new cloud-based ERP offerings. So that they emphasize this aspect during the sales phase. However, the notion of “easier” should not be equated with “effortless.” Transitioning ERP systems is a substantial endeavor, unlike the relatively simple act of changing your cell phone service provider. It remains a substantial investment and can cause disruptions. Determining whether or not to make the switch and strategizing the transition process should be approached with thorough consideration.
What Prompts Companies to Transition Between ERP Vendors and Solutions?
Companies opt to transition their ERP systems for a multitude of reasons. These reasons basically iinvolve the imperative to harmonize business processes with core objectives, the aspiration to capitalize on enhanced features and functionalities (such as advanced reporting and analytics), or simply due to the inadequacy of their current system in fulfilling requirements.
For instance, if an ERP system lacks the requisite scalability or struggles to manage expanding data loads, it becomes prudent to contemplate a switch.
Irrespective of an organization’s size, geographical location, or industry sector, the decision to migrate to a different ERP system should be seriously deliberated when certain operational objectives remain unmet by the present software solution or when the legacy system incurs costs that outweigh its benefits for both employees and the overall company.
Critical Factors to Consider When Switching to a New ERP System
Alignment with Long-Term Business Goals:
To fully harness the advantages of an ERP solution, your company’s ERP strategy must harmonize seamlessly with your overarching business objectives. It is imperative to articulate and formalize your business strategy before embarking on replacing your ERP system. Numerous common catalysts for ERP replacement encompass:
- The current system lacks the scalability required to accommodate business expansion.
- The existing solution lacks essential features and functionalities, not in the vendor’s imminent development roadmap.
- Disruptions within your industry necessitate a digital transformation to counter outdated business models and systems, ensuring competitiveness.
ERP Functionality and Technological Trajectory:
Traditionally, prominent vendors deployed ERP suites as comprehensive, one-size-fits-all solutions. While some vendors still adhere to this approach, the emergence of Software as a Service (SaaS) has prompted more ERP providers to furnish suites tailored to distinct vertical industries, thereby diminishing the demand for extensive customizations. When contemplating a switch of ERP systems, take into account the subsequent considerations:
Functionality and Suitability for Your Specific Industry
Given the prohibition on customizations to vendor-supplied code, organizations must assess the degree to which the SaaS ERP suite aligns with their needs. Certain vendors offer industry-tailored SaaS ERP solutions tailored for vertical sectors like manufacturing, food and beverage, and the public sector. Alternatively, some vendors rely on implementation partners to furnish industry-specific configurations and extensions to cater to vertical industry prerequisites. Both approaches come with their merits and drawbacks. Confirm the vendor’s approach and seek input from references to gauge its effectiveness in their context.
Investment in Enterprise Application Platforms (EAP) and Technology
While functional capabilities retain their significance, equal weight is now placed on the foundational enterprise application platform (EAP) and technological aspects, both in present and in the future. This point intersects notably with the concept of composability. This facet pertains to the ERP vendor’s proficiency in leveraging its foundational technology to introduce elements such as process analysis and automation as integral components of routine upgrade cycles. In essence, the applications themselves become more intelligent, suggesting the automation of repetitive processes as a standard facet of the ERP suite’s regular release schedule. Thus, we achieve substantial leaps in productivity as an inherent part of the process.
The notion of composable ERP heralds the future of enterprise systems. But what exactly is composable ERP? As one of its originators, I find it intriguing to observe how the market construes this concept. Due to space constraints, a comprehensive elaboration isn’t feasible here, but the key elements encompass:
A fundamentally robust SaaS ERP suite constructed atop a cutting-edge Enterprise Application Platform (EAP). This empowers vendors to create and deploy novel functionalities, as elaborated above, swiftly.
A network of services designed to provide fully integrated experiences and capabilities that seamlessly interface with the ERP’s backend. This encompasses sophisticated API management for intricate integrations, embedded AI/ML capabilities, low-code/no-code development and integration solutions catering to power users, process intelligence, and hyper-automation.
It’s of utmost significance that any ERP suite chosen in the era spanning 2023 and beyond boasts a leading-edge EAP. Organizations should accord these foundational platforms a parallel level of importance as functional capabilities.
Transitioning to New Products
Shifting entails a transition to a fresh vendor and ERP suite. Nonetheless, major ERP vendors have heavily invested in modernizing their ERP suites. Thus they render the newer offerings substantially distinct from their legacy counterparts. Even if sticking with the same vendor, adopting a new SaaS ERP system necessitates a re-implementation approach rather than a mere upgrade.
When remaining with the same vendor, change management typically proves more straightforward. However, when contemplating transformation, transitioning vendors can, at times, offer advantages. Capitalizing on the transition to a different vendor can facilitate the embracing of new business models, prompting requisite process alterations.
Preparedness for SaaS ERP Implementation
In the realm of modern ERP, the paradigm involves the delivery of Software as a Service (SaaS) through a multi-tenant cloud infrastructure. This framework facilitates the utilization of cutting-edge technology and the swift deployment of novel features and capabilities. Once you make the decision to replace your ERP system, organizational adjustments become essential to ensure a successful transition.
Frequent introductions of new features and functionalities occur multiple times throughout the year. Consequently, the emergence of new roles becomes imperative to evaluate vendor-furnished functional enhancements and technical capabilities, such as process automation.
The assimilation of fresh features and capabilities necessitates more frequent yet streamlined change management and testing processes, particularly concerning extensions and integrations.
During the course of replacing your ERP suite:
- Clearly comprehend the rationale behind replacing your ERP. Refrain from assuming that a new ERP system will inherently yield improvements. Defining the “why” is paramount for achieving your desired objectives.
- Confirm that any chosen vendor possesses an advanced Enterprise Application Platform (EAP) and possesses the capabilities requisite to support composable ERP.
- Approach the transition from an older architectural version of ERP to SaaS ERP as an exercise in re-implementation. This holds true even if both products originate from the same vendor.
- Prepare your organization for the necessary changes to embrace SaaS ERP. It’s likely that roles and responsibilities within the organization will necessitate adjustment.
- Acknowledge that you should not underestimate the significance of change management and continuous training requirements.
How Do Elate ERP Systems Fit In?
Whether you require assistance transitioning from your existing system to a novel one (such as migrating from another application), guidance in navigating critical data migration challenges, additional project/program management support, or any other intermediary needs, Elate ERP stands ready to provide its expertise.
Our team of seasoned ERP consultants, with their profound expertise and technical acumen, is well-equipped to facilitate the implementation of a new ERP system within your organization. They are capable of not only aiding in comprehending the functioning of the ERP system but also seamlessly integrating essential ERP tools and solutions. Thus, they ensure optimized ERP operations for the long term.
Initiating Collaboration with Us
Are you contemplating shifting to a new cloud-based ERP solution but uncertain where to begin? Our consultants have you covered in this regard as well.
If your interest lies in the implementation of new ERP software to curtail maintenance costs and maximize your technological investments, they are equally adept at assisting you in achieving that goal.
Reach out to us today to delve deeper into our offerings or to embark on a journey with one of our highly skilled consultants.
At Penieltech, we take immense pride in delivering an all-encompassing 360° solution that seamlessly integrates IT and accounting software, synergized with exceptional hardware services. Within our portfolio, you will discover an impressive array of distinguished products. These encompass our proprietary ERP system, CRM Software, state-of-the-art Cheque Printing Software, and a comprehensive suite of accounting services powered by Elate.