As a manufacturing or distribution management team you must make tough decisions on managing operations within the organization. One such decision might be to implement a new ERP system or even upgrade your existing one and investigate what value it will offer.
The concept of digital transformation is not as simple as it may sound. Technology is ever-evolving, and companies need to stay on top of these changes. As emerging and new technology becomes part of your business landscape, you build more connections between various systems, people, and processes. As you become more connected, more data is generated than ever before, creating the need to drive insights and make more informed decisions.
Enterprise Resource Planning (ERP) systems are designed to simplify business operations and remove complexities. They have several capabilities of an ERP system; optimizing cost control, streamlining business processes, improving productivity, and providing real-time data analysis for reporting and decision making. The solution can be implemented in several manufacturing and distribution industries, with various efficiencies and opportunities unlocked in the process.
Why upgrade your ERP system
1. Outdated technology
Many businesses are running on older versions of software that are no longer supported. A legacy system is usually a custom-built application that an organization has used for years or even decades. Many companies are hesitant to upgrade due to the system running fine for their needs or the number of customizations they have added over time.
Business processes change over time, and the solution you are currently running on may not have the visibility, insights, capabilities, or functionality you require to run an efficient operation. Even though the solution was the perfect fit at the time of purchase, it does not mean it will be the best fit forever – technology is continuously advancing and many new products come to market.
2. Business expansion and market demands
Growth could account for many things such as more transactions, increased demands, new products/services, new markets, a new business line, etc. Any way in which your business has increased a variable or process. When organizations grow, they often can outgrow their current system and functionality.
Expansion often creates the need to incorporate new business requirements such as new tax rates, compliance, multiple currencies, or languages — all features that your current ERP system may not be proficient in handling. If your business expands into a new market, you need an adequate ERP system to manage the changes and additional capacity requirements.
3. Leadership changes
Another such instance in which your company may consider upgrading the ERP system is during a leadership change. When businesses gain new leadership, they often restructure and implement new strategies and tools. In the case of a new financial director, he would like to increase things like visibility or automation he may look into the implementation of a new system; possibly one that he is familiar with.
Although there are many additional reasons businesses may choose to upgrade their ERP solutions, these are some common factors that your business should consider. It is vital to evaluate your business, processes, supply chain, strategy, and more for the future to determine if your solution will be able to keep up with demand and ensure efficiency.
