The 5 reasons to change your ERP software

The life cycle of an ERP in the company reaches ten years, even fifteen in some cases. However, as long-lasting as it is, there comes a time when ERP has had its day. How do you know if it is time to invest in a new solution, or if there is still interest in running an ERP that has several years of service? There are several indicators to follow to know if an ERP is no longer suitable and must be replaced by a new generation.


The industrial company grows, its activity develops and diversifies: in ten years, many changes have taken place in its activity, its processes, its offer, its constraints to remain competitive. It is logical that its historical ERP, even well maintained and supplemented with functionalities developed during its life cycle, ends up no longer meeting the needs.


An aging ERP may lack flexibility, fluidity and responsiveness. It is difficult to adapt to new processes and becomes too complicated to use, often from a not very ergonomic interface. He can also show signs of fatigue, with slow processing and too long response times. Finally, technology evolves quickly and the older a solution, the more difficult it is to integrate new applications.


To identify more precisely the need to change ERP, here are the signs that do not lie.

Soaring ERP-related costs

Maintenance is certainly a regular cost linked to an ERP, but the amount can soar with an aging solution. And this for two main reasons. On the one hand, if the publisher has not ensured a high level of maintenance, the shortcomings are increasingly felt over time and the only solution remains even more maintenance. On the other hand, a legacy ERP is likely to rely on hardware that is also aging and prone to breakdowns. Hence more maintenance interventions to avoid any interruption and, worse, data loss.


Other expenses with an ERP that is out of breath: the lack of functionalities for new uses, which implies specific developments to fill the gaps. However, these developments are expensive. They are justified as long as the functionalities of the ERP cover almost all the functional field required as standard, with a few optimizations. On the other hand, when too many specific developments are required, it is better to stop the costs and invest in a new ERP.


On the trail of new technologies

Web interface, Business Intelligence, Cloud, mobility, e-commerce… so many technologies and applications that were not yet widespread when the oldest ERPs were designed. However, the technologies and new uses enabled by the latest generation ERP solutions are sources of efficiency and savings, and customers are asking for them.


This is why publishers make their ERPs viable from version to version to allow the solution to remain compatible with new technologies for as long as possible. When this is not the case, or an ERP is no longer maintained, users lose many opportunities. For example, an ERP that cannot work with or in the cloud robs the business of valuable mobility. It is then impossible for users to consult remote ERP data and indicators in real time, in particular at the client's. Or, when an ERP does not integrate Business Intelligence, so many operational and optimization indicators are missing.


A penalizing lack of scalability

In addition to integrating new technologies, an ERP must also have enough scalability to adapt the functional field to new needs – which do not fail to appear when the company evolves over time.


A legacy ERP does not always allow the implementation of new processes, because it is not possible to enrich it with the corresponding functionalities. This lack of scalability is a real obstacle for the company. To extend the example of Business Intelligence, the impossibility of integrating a module dedicated to the ERP requires the equipment of a third-party solution, with a risk of interfacing problem with the ERP of another generation.


The difficulty in obtaining new functionalities can also come from the fact that the publisher of the solution no longer offers updates. This is the sign of an outdated solution, on which even its publisher no longer relies.


An ERP less and less useful to users

The primary purpose of an ERP is to optimize operations and deliver visibility and activity indicators that are useful for decision-making. When the processes and associated data processing are oversized for the capabilities of ERP, users do not find the expected benefits.


Notably, in terms of overall performance, ERP no longer helps decision-makers improve customer service, sales, or save money. From stocks to the entire production chain, flows are not properly managed. Conflicts on the shop floor arise, which the operational staff cannot anticipate. Hence, also, problems of unavailability of products that put salespeople in front of dissatisfied customers… the list of all the shortcomings suffered by staff due to an obsolete ERP is long!


When the ERP no longer fulfills its missions correctly, users tend to resort to the D system and develop their own tools and spreadsheets. But unlike ERP, these tools do not interconnect their data and do not perform the advanced calculations and analyzes of an ERP worthy of the name. The company misses multiple optimizations and savings, and the solution lies in a new ERP.


Obstacles to interacting with the ecosystem

Any company operates in interaction with many partners, resellers, suppliers. This ecosystem now benefits from technologies that digitize flows and data to work together in a connected way.


In this context, the ERP must contribute to establishing win/win relationships with the ecosystem and support the development of the structure. This implies being able to provide access to the ERP to certain interlocutors, and to exchange data with them, from system to system.


When an ERP was not designed for this interconnection, and cannot evolve to adapt, the company can miss out on business and development opportunities. Its ERP also no longer allows it to remain competitive, because it slows down the company's responsiveness and its ability to respond to its customers. In this case, the ERP loses all its interest and it is time to move to a next-generation solution.


In conclusion, an ERP is above all a solution that facilitates operations, performance and customer satisfaction. From the moment an aging ERP hinders the development of the company, it must be replaced.


Investing in a new ERP can only bring a satisfactory ROI by eliminating the pockets of expenses of an outdated solution, and by generating new savings. This is particularly the case in terms of maintenance costs when the company opts for an ERP in service mode (SaaS) in the Cloud, where many ownership costs disappear. There is therefore a real interest in taking the plunge.

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