Johannesburg, 23 Feb 2017
Enterprise resource planning (ERP) solutions do not have a good reputation. A few years ago, Gartner put the failure rate at 75%, and in 2016, the analyst firm predicted 90% of ERP solutions will fail by 2018. Why?
Too complex, failure to implement strategically and inefficient execution. ERP solutions are tricky to deploy, cause plenty of trouble, and often organisations feel as if they spend more time hunting for value than receiving it.
Christiaan Kriel, Business Unit Director, EOH Applications, believes this is because traditional ERP implementations haven't evolved. They haven't adapted to the potential of cloud and the inherent value of big data, and aren't even close to meeting business goals.
"About a year ago, the market was skittish - it wasn't convinced that cloud-based ERP was the way forward or that it would come close to delivering on its premise," he says. "Now we are at the point where the value it represents is obvious. The landscape is changing and business agility is mandatory - those who fail to recognise the importance of harnessing the cloud will be left behind."
'You'll be left behind' may be the mantra of the technology world, one which businesses hear and ignore, but statistics point to its validity. Organisations that look to strategically implemented cloud-based ERP solutions will see reduced costs, faster time to deployment, limited risk, increased scalability and improved security and operational efficiency.
"If your ERP system is integrated properly to all your other line-of-business applications, the solution will provide the right information at the right time so customers can make strategic decisions; the result is business agility," says Kriel.
Cloud-based ERP is a tool that allows organisations to react faster and more efficiently to a business landscape that changes mood and parameter with each new breath of innovation or invention. ERP systems that don't allow for the organisation to move forward or change direction at the pace they need are of little to no value.
"What we're seeing with traditional ERP implementations is that they are just frustrating business users," says Kriel. "They were implemented in line with the then business snapshot and the implementation never evolved as the business changed. Users are sitting with an old snapshot and can't understand why ERP doesn't work anymore."
Of course, the problem is that the old ERP implementation generally cost more than an arm and a leg to implement, and so businesses are understandably reluctant to let them go. Kriel has some advice: "Your ERP should enable your business, not hinder it. The true value of ERP is realised when your solution empowers your business with exactly the information you need, when you need it to react to your business landscape's current reality. Furthermore, your business landscape will change, constantly, and therefore you need an ERP solution that allows you to change and scale with it. Cloud has changed this dynamic completely. If your current ERP does not provide all of this, what you're missing out on is much more than what you would need to invest in an ERP refresh."
ERP in the cloud comes with swift scalability, and because vendors are continually adding new features and functions that are available on demand, cloud-based ERP is much better suited to adapt to your changing business needs. This level of fluidity and agility keeps the business improvement conversation alive, allowing the organisation to always use the latest version and make use of whichever features they need, when they need them. However, it doesn't end there - cloud may have brought some glamour to ERP, but big data is about to make it into a star.
Kriel concludes: "Daily operational decisions can be made sustainably and reliably, thanks to the gravitas of big data. This will impact on business growth and success. The biggest challenge for big data was that it used to only be accessible after the fact; this is no longer true. If it's coupled with analytics tools, data is as accurate as possible, and it is live. Now the business has something that is incredibly powerful when it comes to making decisions. Blended with big data and cloud, ERP is finally living up to the potential we always knew it had."
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