There are four key trends making a large impact on current enterprise resource planning (ERP)technologies – social, mobile, cloud and information management. These four trends are influencing the need to drive ERP towards user-centricity and away from traditional monolithic ERP architectures.
That’s according to Jeremy Waterman, MD at Sage ERP Africa, who points out that most mainstream ERP packages have technology architectures that date back to the late 1970s or the 1980s, and few vendors have comprehensively overhauled the old technology underpinning their systems.
As such, says Waterman, many ERP packages are still based on technology originally designed for green screens and dumb terminals.
“Over time, vendors have added client/server graphical user interfaces and, later, Web access, to their business solutions, but this has amounted to painting the proverbial pig with lipstick. The benefit for both vendor and client was that this approach preserved the investment in business logic and reduced the risks of a complete transformation of the system,” he says.
However, he points out that systems based on legacy code become complex and expensive to maintain because of the proliferation of interfaces, and the problem becomes worse as more and more layers of new technology are added.
The user experience can also be fragmentary and unsatisfactory, because legacy code bases are not designed for mobility, the cloud, self-service business intelligence and other current technology trends, says Waterman.
“We know that increased competition is forcing every business to be unique and different. So how do businesses increase the relevance of ERP solutions, and how do they use ERP as a foundation for innovation and differentiation?
“Mobility and cloud are disruptive forces in the market today and the Web has completely disrupted the value chain. Markets are transforming, and organisations have the choice to disrupt or be disrupted. Reacting responsibly to the disruption by investing in purposeful innovation, where customers have flexibility and choice, will give your business a competitive edge,” he notes.
According to Waterman, having the courage to disrupt your business – before being disrupted by a market – is not necessarily easy, because it means taking risks, but it is about having belief in your vision and strategy and ensuring that everything you will be doing in the long term will be effective.
“Disrupting is also about taking a responsible leadership position and ensuring you move at the speed of your customers while innovating. There is no sense in just developing a good product; you need to invest in purposeful innovation.”
The mobility tsunami is reaching all global shores, Waterman says, adding that there will be one billion mobile devices in the world by 2015, of which 140 million are going to be tablets. Mobility is driving a new cultural dynamic and is allowing business to be conducted anywhere, anytime, he points out.
In SA today, he adds, there is a 135% mobile penetration, which means, on average, 1.4 devices per consumer. The market’ s Internet penetration is 41%, with a 140% Internet user growth, and South Africans will contribute $400 million to cloud revenue by 2017. This indicates that the South African market is ready for disruption in mobility and cloud, says Waterman.
Thus, he believes that organisations have to be prepared for the disruption. They need to be thinking cloud mobility, software as a service and reliable cloud infrastructure, he states.
“Cloud gives organisations flexibility and choice. For example, flexibility in how they purchase, where they access, how they implement (in the cloud or on-premises) and a choice in pricing (upfront payment or subscription). It also provides for an unprecedented upgrade experience and complete flexibility in terms of support.
“Mobility is inspired by a changing connected world. Customers want mobility within the ERP ecosystem because it provides for superior customer service for their customers; faster movement of information; getting paid faster; significantly increased employee productivity and satisfaction; as well as reduced costs,” Waterman notes.
Concluding, he points out that the investments businesses are making into technology must be strategically aligned with their business plans.
“It’s important to choose an ERP system scalable enough to grow along with the business for the next 10 years, as well as to ensure that it is based on a flexible architecture that will accommodate changes in the technology landscape in the years to come.
“Businesses with an effective ERP system that provides usable and accessible data will be the ones that perform best. By building the solution organically, mid-market businesses stand a much better chance of going forward.”