Johannesburg, 06 Apr 2018
Data, data, data. There is so much data being generated today. Businesses increasingly see the value in that river of data - or at least perceive it. So they look to their IT systems to deliver that value, to capture the data and turn it into something meaningful.
The possibilities are immense. Everything from tracking a package to offering enhanced customisation on a purchase (would you like that in green?) relies on data to keep the business and its customers informed. A trendy example at the moment are chatbots, which can respond to customer queries in natural language at any time of the day or night.
But such projects rarely work and survive in isolation. To make them useful, they need to be part of a larger data ecosystem. This is something that many companies fail to do, yet the answer to that lies with one of the most trusted applications in the organisation: the ERP.
"The ERP would make the most sense to be that central pool for data," says Bernard Ford, One Channel's CEO. "A post-modern ERP is that - it's not just a typical ERP with accounting and inventory movements. It's a lot richer in information."
The evolution of ERP
ERPs have evolved beyond their role as enterprise resource planning tools. Not too long ago they were used by the few, a handful of key employees interacting with primarily financial data.
Over time ERPs have become more robust as they added features. Today the ERP is a universal touchpoint for just about everyone in the business, from internal staff to value chain partners and even customers. An ERP can reach through to a point of sale, engage mobile workers through their handheld devices and support Web-facing services. All of those same people and business devices are also generating data: graphical data, machine data, and much more.
Bringing the two together makes a lot of sense, says Ford: "Data on its own is meaningless. It's difficult to process. You need the right systems to scale processing, as well as have AI components built in to do something useful with that data. Predicting what a consumer will do on your Web site is an example - the AI can suggest to the customer what they might want to buy."
Using an ERP as the central data cog makes sense as it puts the data at the fingertips of the ERP's users. It also opens the doors to use advanced machine functions, such as artificial intelligence. People are good at making decisions and machines are good at analysing. Companies that can strike that balance will benefit most from their data.
Making the change
So it's a done deal: take your ERP and get the data flowing towards it. If it lacks that functionality, no problem: just get a bolt-on module and you are good to go! That's often how it worked in the past, so why not now?
Not quite. Traditional ERPs are still cast in the mould of previous technologies. They remain monolithic, rigid and slow movers. Though it's feasible to introduce some of the new technologies into that environment, it is also expensive and sidesteps the more agile advantages of the current digital/cloud movement in software. There are also cases where it won't play ball, such as scaling for load management or integrating third party services, said Ford:
"You should be running a modern ERP that doesn't need intermediate middleware to make it work. But these are large investments, so it's down to ROI to change it. Organisations should though look at it. You can't just virtualise and modernise. The essence of the design of the system is to interact with the multi-cloud world and leverage those services. To do that with older ERPs, modernisation people have to write interfaces. The cost of that may be more than simply replacing the ERP."
There is the option to wait for your current ERP's vendor to upgrade their software. But that is a risk. There may already be too much culture and resources invested in the current legacy to make radical enough changes. You may just end up with a circle in a square.
The problem with legacy ERPs is integration: they aren't capable and ready to interact with all the information sources out there, located in different places. A good example is consumer behaviour in e-commerce, with a sale happening on the site, stock issued issued from a warehouse and collection at a storefront POS. Data sits in different places and legacy ERPs simply cannot deal with that elegantly, if at all.
The end of proprietary
The fundamentals have changed. ERPs used to be highly proprietary systems that commanded all of the attention and changes. But post-modern ERPs are far more open. For example, introducing new languages to the interface may have once been expensive or tricky. Today it's a matter of introducing modules from services such as Google or Bing Translate.
Ford also raises the example of document storage services, such as Box, Onedrive and Dropbox. Those can be introduced securely and reliably. The same with chatbots: want an AI to interact with clients on Whatsapp? That can be done. Why reinvent the wheel to get these services? Post-modern ERPs use the same technology that users are.
Then there is the cloud. It is a myth that new ERPs have to be online all the time. If anything, they require less network capacity and offer more offline redundancies than incumbent ERPs. In addition, because post-modern ERPs are very comfortable with the cloud world, they open doors to scaling performance. Run it at peak for month-end or during a sale, then scale back to engage savings and cost control.
Company developers can use the ERP to create new services or improvements. Even more casual users can take control of the design elements, creating forms and dashboards that make sense to their processes. Above all, data and the cloud are great companions - and managing data may be your ERP's greatest contribution yet. Ford, whose career spans across the ERP landscape, agreed:
"These are highly flexible platforms. They do far more than what previous ERPs could. Replacing your current ERP isn't going to be easy. You'll need a strategy for that. But it is one of the greatest modernisations you can bring into a business today and creates a platform to achieve great things with your data, workforce and customers."
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