Just as companies must transform to meet today’s challenges, the software vendors they rely on must also mutate their products to become a better fit for the next generation of organizations. And that’s happening with ERP. Here are seven ways ERP is evolving.
1. Extensibility And Integration
If it’s fair to say that the top priorities for software today are flexibility and ease of use, then the future direction of ERP fits the bill. The most effective ERP software today is far more than a “black box” for inventory management and payroll. It’s an ecosystem where applications and business processes work together to meet the needs of the customer.
As part of this ecosystem, ERP vendors are creating platforms that can span multiple lines of business and across an organization’s entire enterprise (and beyond). The goal, of course, is to enable organizations to move faster and innovate more using fewer people.
2. Human-ERP Interaction
You can’t do everything from within an ERP anymore with its monolithic UX of hundreds of menu items, thousands of screens, and millions of interdependent fields. However, what used to be an invasive, complicated system with a UX and processes that nobody understood – and where users when to start a transaction – is set to evolve into a pervasive, easy to use, self-driven tool that starts with an analysis, then invited the user to a conversation.
3. SaaS: A Question Of “When” Not “If”
The global ERP software market is projected to reach $66.38 billion by 2026. From our experience, lots of companies are aggressively perusing digital transformation, and at a much higher speed than expected.
The main driver of digital transformation in almost all companies is to improve efficiency. By adopting cloud services, companies can not only cut costs but also save time and resources to invest in providing valuable customer solutions.
4. Vertical-Specific Standardization
We could expect to see initial implementation fast-tracked through automation and the use of already proven industry standards through pre-configured vertical-specific solutions.
Since these solutions can be implemented in a short time by taking advantage of the expertise in the field, ERP vendors will give tools for easy customization and localization to business units.
5. Software Up, Services Down
In my view, the balance between selling software and services will change for vendors, at least those selling vertical solutions and templated implementation models. To begin with, vendors of ERP systems will continue to sell their products online, and they will continue to win new customers. However, they will look for new ways to get the most value from the sale; their money will come from services over time.
6. Re-Architecting Versus “Lift And Shift”
If you really want to make sure you get all the benefits from a multi-tenant cloud solution — operational efficiencies, customizations, integrations, extensibility, and in many cases UX — you need a solution that’s architected for that specific deployment scenario. This means starting from the ground up.
7. Greater Understanding Around AI Hype
Although we’ve been on the AI hype bandwagon ourselves, and we talk a lot about automation, I think AI is over-hyped. From my perspective, it’s not really “intelligence,” just math. However, when it’s applied to the right problem with the right parameters from people who understand the business, AI can transform stuff.
In addition to taking advantage of machine learning, you’ll see machine intelligence deployed in a more human-like way that can “ask questions” and “mature.
Does Your Vendor Walk The Talk?
In its guide for selecting ERP software, Deloitte references many of the elements of ERP’s evolution that I mention above and poses the question: “With marginal functionality differences between platforms, how can organizations take a more progressive approach to ERP selection for core financials?”
I think it’s important that the next wave of ERP vendors walk their talk, and continue to evolve with the market, rather than stagnate with outdated product pipelines.
By definition, ERP is an evolved set of products and services designed to run your business. It’s packed full of clever features like cross-channel automation tools, cloud integration, BI/EDW reporting, mobile reporting dashboards, and much more.
Interested in reading more about how ERP systems could benefit a business? Intelligent ERP Systems – Secret Key to a Competitive Edge discusses what an intelligent ERP system is and how it is beneficial for any business.
If you would like TSVMap™ to assist your business with assessing your essential systems and applying the TSVMap methodology to ERP Systems, MRP Systems, Cyber Security, IT Structure, Web Applications, Business Operations, and Automation, please contact us at 864-991-5656 or email@example.com.