Well enough is not good enough: How to justify an ERP upgrade21 Dec 2018 | by Brett Mundell
Has your ERP almost reached its end of life or end of usefulness, but you’re not sure if you can justify the cost, time or effort required to implement a new system?
The fact you’re reading this article is probably a good indicator that you’re frustrated with the status quo. Enterprise Resource Planning (ERP) software sits at the centre of business operations, so when it’s not quite up to the job, it can make your life harder.
Let’s examine the signs that your existing ERP platform is in dire need of an upgrade, what barriers and benefits come with transforming your tech, and the true cost of doing nothing.
An ERP is good, until it’s not…
The typical lifespan of ERP software is around 10 years. After that businesses often need to stop and rethink whether the technology is still meeting their needs. A lot can change in 10 years—including your business model, team members and the technologies available on the market.
Maybe your current ERP hasn’t kept pace with change. Or if your company is growing rapidly, the problem could be that the solution you chose originally—which was a good match then—doesn’t have the features your company needs right now or into the future.
Top signs an ERP upgrade is urgent
These are the warning signs your business needs to look out for:
- People rely on other programs or apps as a work-around to using your ERP;
- Your team can’t easily complete tasks in the field or work remotely in the cloud;
- Your ERP isn’t truly integrated with core business functions, like finance or marketing;
- You don’t have access to features, add-ons or workflows your competitors use as standard;
- Your ERP feels slow and clunky to use and it doesn’t parse data in real-time;
- When your team has a problem with the ERP it’s hard to get vendor support or fixes.
Read more about the ERP replacement signals every business should look out for.
Not sure you’re ready for change?
When you’re tired of struggling with an ineffective ERP, it’s easy to arrive at the decision that a new ERP is the best course of action. However, the thought of implementing a new system is often unappealing. It requires internal buy-in, funding and time to implement.
But where organisations can really get stuck is answering this question: what’s the ideal alternative? How do you even start researching when there are so many options?
The following resources can help you build a business case, and simplify the process of determining what kind of solution and vendor you’ll benefit from:
- Review our list of eight strategic business considerations that will shape the kind of ERP you go looking for. For instance, what kind of business intelligence insights will you need, and what are your priorities when it comes to choosing a reseller/partner—who will play an influential role in your implementation success and ongoing support needs.
- Define your specific implementation requirements before you start evaluating different software, with our comprehensive ERP requirements checklist.
- Discover how to request and interpret ERP investment proposals accurately to ensure you’re comparing apples with apples.
The difference between value and cost
Selecting new software involves an investment, and price considerations will obviously play into your choice about when and how to upgrade.
But it’s important to remember that the true value of a quality ERP is a better functioning business that can scale and grow. In fact, the cost of NOT implementing an effective ERP solution should be part of the return on investment calculation.
As you get bigger, problems with your processes or internal communication don’t magically disappear. In fact, they become amplified. This is especially true if you operate in a complex industry or business environment, such as across multiple sites or countries.
An ideal ERP will improve visibility across teams and your entire operation, increase productivity. automate repetitive tasks, and provide insights you can use for clear decision-making and better forecasting.
When cash flow is improved, employees are high-performing, and your customers are completely satisfied, loyal and recommending you to others—you can expect more sustainable business growth and profitability over the long-term.
That’s an excellent reason to act now if your current ERP isn’t up to scratch.
At Leverage Technologies, we help Australian businesses find and implement the right ERP solution to grow smart. For more information or to speak to a consultant call 1300 045 046 or email [email protected].
Brett has more than 20 years of business software sales and company management experience. Brett has been involved in more than 300 ERP projects. His passion is customer satisfaction, making sure every client is more than just satisfied. Brett wants our customers to be driven to refer their friends and peers because we offer the best services and technology available and because we exceeded their expectations.