Upgrading to a new ERP system can be a daunting proposition for any company. For one there’s no shortage of things that might be stopping you from making the transition. Is it economically feasible? Perhaps, you’re not yet in a position to deal with the inevitable cultural barriers and change implications that will arise from a change of system Or maybe, right now, ‘Making do’ with your current system is an easier option than taking on a new ERP system.
For the majority of companies, the benefits of upgrading their existing ERP system far outweigh any reservations they may be having. Below, we’ll look at how your legacy system may be holding you back, how an ERP system can provide a range of benefits across the business, and what goes into the ERP upgrade process ahead of the big move.
Understanding your business software needs
It is essential that you begin by focusing on the goals of your business. Once you know where you want to go you can start to envisage how upgrading to ERP software might help you get there. Ask yourself the following:
- What are you trying to achieve?
- What are your short-term and long-term objectives?
- How do you intend to satisfy these objectives?
- How relevant is your current business software to your business strategy?
- What do you need from your software to get to where you want to be?
- What challenges does your current system pose right now?
- Talk to the users of your software. What are their expectations from the software and how is your current system fulfilling their needs?
Sticking with a legacy system comes with its share of risks. For starters, you might be leaving yourself open to security threats. Outdated protection can be easily hacked, and the resulting fallout can cost businesses dearly.
Likewise, old systems are prone to slow performance, frequent crashes, and recurrent repairs. When a system goes down, a business can’t operate, with all other operations relating to the system on hold as a result too. Factor in high maintenance and repair costs, and your business could end up losing more than you might expect just to keep its legacy system up and running.
And in an age where customers and clients demand faster responses, products and solutions, a legacy system may not be able to keep you as competitive as you need to be. Often, outdated software stands in the way of the scalability and growth that’s required to deal with the constantly changing landscape of your industry. And you can miss out on utilising the latest technologies to improve your business when your legacy system can’t integrate seamlessly with new platforms.
Quantifying the impact of staying with your current software versus upgrading to an ERP system
Weighing up your options may involve carrying out a cost/benefit analysis. Doing so will help you determine which alternative is likely to provide the greatest return for the proposed investment.
Identify the potential costs and benefits of upgrading your software and compare them to the cost and benefits of your current software system by analysing the data:
- Quantitative data (i.e., measurable data, including the cost of the software, implementation, training, optimisation of your system, any development needs, support, maintenance, hardware requirements, etc.)
- Qualitative data (i.e., data with a high degree of subjectivity – difficult to quantify but still an important variable – including the benefits gained from ease of use, time saved, access to a seamless flow of accurate, real-time information, improved customer services and having a mobile workforce)
For most companies, the primary factor shaping the case for a business management software upgrade is ROI. Companies expect a new system to pay for itself in a very short period. This goal is entirely achievable with the right solution.
What are the benefits of an ERP system?
Businesses upgrading to an ERP system can expect the following advantages:
Reduced costs
Upgrading to an ERP system might come with substantial upfront costs, but in the long term, it’s an investment that’s well worth it. Most vendors now offer a Software as a Subscription (Saas) service model which can make that initial outlay even less threatening to your wallet without losing out on the benefits of an ERP system.
And by streamlining repetitive, labour-intensive tasks like reporting, sales and purchase order processing, stock management etc, you free up your time to focus on responsibilities that are comparatively more high priority.
Total visibility
By making data from every department easy to access, ERP software lets you view every essential process from across your business. And with complete visibility from this centralised location, you can create more streamlined workflows and strengthen inter-team processes with ease, both of which allow for quicker, more confident decision making, not to mention, improved customer services.
Improved reporting and planning
An ERP system grants you a single, unified reporting system for all your processes. That means you can easily generate valuable reports and analytics any time you need to. Free from spreadsheets and email chains, analysing and comparing cross-departmental functions becomes much, much simpler.
Coupled with business intelligence tools, it’s possible to drill down into your analytics even further. With more in-depth insights on your side (that are available when, where and in a format you desire), your corporate planning also benefits from the ability to identify operational strengths, as well as problem areas that need improvement.
Greater scalability
An ERP can accommodate the growth of your company in ways that a legacy system simply can’t. From expanding customer bases and entering new markets to rolling out new processes or products, an ERP can easily implement new functionalities that can ease the growing pains that come with scaling up your business. And, where REST API capabilities exist, it can accommodate seamless integration of new technologies for improved efficiencies and customer service .
Improved supply chain management
Where the movement of physical inventory and production is concerned, an ERP system can help your supply chain management in several different ways. Through greater demand forecasting, inventory management, procurement and more, you can create shorter lead times, more timely deliveries and innovations that fuel reduced costs and give you a greater competitive advantage.
The process of upgrading to an ERP system
Look for opportunities to streamline
It’s vital that you get the most from an upgrade to new ERP software. Be on the watch for any processes you would like to streamline that may let you optimise your efficiencies and your bottom line. Identify any wants and needs, or pros and cons, to help you outline any areas where your current system may need to improve. Those who use your software will be able to highlight any weak points and inefficiencies, so be sure to include these team members in the process.
Review existing policies, procedures & documentation
Take the time to review your current policies, procedures and documentation. What works and what doesn’t work in your current system? Where can a new system introduce greater efficiencies? Is there an opportunity to become paperless? Non-compliance is an issue you don’t need the hassle of dealing with so investigate how an upgrade could make you more industry compliant
Analyse processes, workflows and reporting
Ahead of your upgrade, look into your existing processes to see if they are fulfilling your business needs. What changes would you like to implement that might make them more efficient? What new modules or features would you like included in your new system that could help you better serve your customers. Whare can automation help you improve workflows and reporting.
Do your reports show your most vital business details too? Is your system giving your team access to the information they need when they need it? Get in touch with department heads; they will advise you on the areas they would like to see improved during the upgrade.
Establish a project team and plan
Upgrading your system will need a team with the skills to make the process as pain-free as possible. Go for people who know your business well, can be given the time to dedicate wholeheartedly to your implementation, and who are committed to improving business performance in the long term.
Likewise, you’ll need a roadmap with which to guide you over the course of the project. With this plan, outline the goals of the objective and align them with the business’ wider aims. Doing so ensures everyone understands the importance of what they’re doing. Your plan should also include information on project scope, timeline, infrastructure, roles and responsibilities and budget.
Once you’ve upgraded, getting everyone up to speed on new features will be an essential part of ensuring project success too.
Be sure to follow up
Post-upgrade, now is the time to follow up with those who use the system. Your team is bound to have questions or concerns, so make sure you lend an ear to what they have to say. Regular updates and evaluation will also help to maintain consistent performance and support along with instilling a culture of continuous improvement.
A future-proofed business is one that’s ready for whatever comes its way. Intact iQ connects and supports your business anytime and anywhere. For more information on how it can optimise operations, head to our dedicated page or get in touch with us today.
