With newer ERP features and applications being developed all the time, it’s important to investigate your options. Plus, in this competitive landscape, chances are that your peers are already updating their ERP systems, and you want to stay relevant.
What is an ERP system?
ERP is business management software that allows an organization to use a system of integrated applications to manage and integrate a company’s financials, supply chain, operations, reporting, manufacturing, and human resource activities.
Now that you know what an ERP system is, learn the five steps you can take to implement a better solution for your business.
Step one: Identify the limitations of your current system
Here are three signs that it might be time to replace your legacy system and implement new software:
Has your current system kept up with you as you’ve as grown and added more staff, clients, and business processes or entered into new lines of business or markets? An ERP solution should allow your company to expand while it operates and maintains everyday business processes.
Lack of insights
Even though ERP software offers real-time visibility of an entire business, as well as insights into the industry landscape, many companies still opt for legacy software that works independently from other systems. This can lead to different departments working in silos. Software that ties all your disparate systems together while offering data analytics and business insights is a win-win, offering productivity, growth, and a competitive edge.
Costly legacy system
Most companies have taken a deep dive into what they’re paying for their current ERP deployment fees and maintenance. Although they know about the hard costs, most don’t know about the pros and cons that come with each deployment option, whether it’s on-premises, in the cloud, or a hosted ERP solution. It may be time for an even closer look to decide if you should move to the cloud, keep things on premise, or invest a combination of both.
Many businesses believe they have to do a complete ERP overhaul and get rid of the system they’re using now, but that’s not true. An ERP system can be the sum of many applications and add-ons. So, if you don’t currently have a system that’ll let you keep the processes that work and add new ones, look for software that does.
Step two: Remind yourself what an ERP system should offer
Let’s start with the ERP nuts and bolts. Here are some of the basic components that every legacy ERP system should have:
Not only should your system help you meet regulatory compliance, it should also deliver accurate data and analytics to help you keep an eye on your budget, including the management of multiple currencies, cash flow management, and bank transactions.
This function should give manufacturers the ability to access real-time data to optimize production planning, as well as project and cost management. ERP manufacturing should also offer the ability to manage resources and fulfill customer needs.
As the days of manually entering information and doing physical inventory of goods become relics of the past, this function should improve warehouse and inventory management and let businesses gain greater insights into their products and integrated logistics.
Step four: Create a game plan
It can be overwhelming when you think of implementing an entirely new system or knowing what to add or take away from what you have now. The better your plan, the smoother the improvement or replacement of your legacy system will be. Start with these three steps:
Make a wish list
Write down the ERP functions you’re already using. Even if it’s only a basic financial and inventory tracking system. Now make a list of the features you’d like to have or need. Now that you have some options and ideas of what’s out there, you could also look into special features like adding pre-built applications or build custom applications.
Set your budget
Now that you have your wish list, the next step is to set a budget. Like buying a new car, you should know whether your budget allows for a used car or brand new one. Knowing this helps you focus on the systems and features you should be looking for. Start with the cost of supporting and maintaining a system then look for any hidden fees along the way.
Don’t be afraid to ask questions
Don’t settle for a one-size-fits all solution. Make sure the solution you’re looking for caters to your unique business needs. If you want to move from on-premises to the cloud, but have questions about security, find a technology partner to help you address those concerns.