The Most Important Reason To Change Your Erp Vendor And Erp Software

The Most Important Reason To Change Your ERP Vendor and ERP Software System

Companies who thought implementing their first ERP system years ago and making the financially significant investment in an ERP software solution was the hard part may be in for an even harder journey ahead. What many companies with ERP systems currently in operation are finding out is that is an even bigger decision both financially, operationally and resource wise to switch to a new ERP vendor or vendors and a new ERP software app than implementing an ERP system for the first time.

The business disruption with switching enterprise systems can be much higher with ERP vendor switches. Just as with real estate, in many cases its easier to build a house on a open lot rather than trying to remodel a tear down. On top of this, a company who has been using an ERP system will most likely have a business that is humming along, and the business disruption will seem much greater than what it was when incorporating the first enterprise systems. Furthermore, the competition landscape is more competitive than ever, and any loss of productivity and service levels could lose you a lot of ground with customers and with your competitors. These risks, and the fear of the unknown has kept companies in a status quo mode when it comes to their ERP applications. Although the current ERP solution may not be the state of the art system, it still works and managers at least know what the system and ERP modules can deliver. The risk of a failed ERP implementation or new ERP modules that don't work as anticipated keeps IT manager up at night and hinders them from trying something new.

The most important driver for taking the risk to consider new ERP vendors is to take a high level look at your organizations business processes and how they are negatively impacted by your current ERP software solution. In other words, look for your broken, inefficient business processes that are that way because they needed to work around your current ERP application. To help clarify your current system limitations, identify all of the ad hoc programs that were developed over the years by your IT staff to work around the shortcoming of your current ERP system- you may be quite surprised by what you find. If indeed you find that your business processes are broken, you should most likely entertain the notion that you need to look for new ERP vendors. Company's looking to dramatically improve their business processes usually start by getting an ERP system implemented. The same logic should hold for your company, despite the fact that you already have an ERP system in place.

The main issue with legacy ERP systems, especially the older systems, is that they were very inflexible with respect to functionality and customization and companies had to change their business processes to accommodate particular ERP modules and features. Any customization that was critical to have required extensive programming and significant resources to implement and maintain. This may have sufficed a decade ago, but with more options available now and because business processes are changing at a much more accelerated pace in today's market, a company has many more options and many more pressures to get the optimal ERP vendor and solution available on the market place. The decision to take on new ERP software solutions will be automatic when companies reach the point where there current enterprise solution is hurting their business, the key is to make this decision before the damage is done.

In Part 2, I will talk about another driver for going with a New ERP Software System and ERP Vendor, outdated System Technology.

by: sudhaniSEO

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