In today’s technological era, businesses rely on software to efficiently carry out their day-to-day operations. One such system that’s often used by modern businesses is the Enterprise Resource Planning (ERP) software, which helps streamline business operations such as supply chain management and accounting. However, like every other technology, the ERP system does have a limited shelf-life. Because of this, the ERP system you’re using may no longer be compatible with current technologies, thereby negatively impacting your competitive edge and reducing your productivity.
So how can you tell if it’s time to change your ERP system? Here’s a guide on the clear signs you should look out for to know if you should schedule to change your company’s ERP system soon.
1. No Vendor Support
One of the most evident signs you should get a new ERP system is when the vendor doesn’t provide you with the support you need. This is crucial because, like any software, the ERP system might suddenly experience an issue you or your staff can’t resolve without help from the vendor. However, if the manufacturer is uncooperative, you’ll be left with a malfunctioning ERP system, leading to increased susceptibility to cyberattacks or breaches, greater downtime, and reduced productivity.
The lack of vendor support can also leave you with an outdated ERP system that doesn’t meet your business needs. If you’re dealing with such downsides, it’s time to switch to a new vendor like NexInfo’s ERP consulting services. That way, you’ll be sure to get a suitable ERP system with the necessary assistance you need to go through the different stages such as discovery, user training, selection, customization, implementation, and ongoing support.
2. Not Meeting Customer Needs
Without customers, your business would cease to exist. Therefore, it should be your priority as an entrepreneur to ensure that your customer’s needs are met. However, this can be a challenge if you’re using an outdated ERP system since you won’t have direct access to inventory data, shipping, and billing. This is because the design of old ERP systems can’t offer easy access to information from different parties. They also weren’t customer-oriented, thus forcing your clients to seek professional assistance to obtain any information they need.
On the other hand, a new ERP system does away with these shortcomings and complexities. It does this by integrating cloud services, enabling your customers to get real-time access to information from anywhere. Without an updated ERP system, your company will lose its competitive edge over other businesses.
3. Functional Limitations of Your Current ERP
The goal of every entrepreneur is to see their business grow, and this is precisely why they invest in an ERP system in the first place. But as your business expands, so do its core functions, including inventory management, finance, and accounting. In addition, other requirements emerge, including warehouse management system (WMS), mobile solutions, e-commerce, and point of sale (POS). These added requirements can’t be handled by an obsolete ERP system that starts to experience certain functional limitations the older it gets.
Other functional limitations that strain your existing ERP system include greater technical requirements from vendors, unveiling new products or services, and acquisitions. Due to these shortcomings, you might need to invest in a new ERP system to effectively carry out new tasks associated with your growing business.
4. Your Staff Choose to Work Outside the ERP System
The primary purpose of the ERP system is to streamline company operations. It does this by ensuring your staff members are working as a team and are on the same page towards reaching the business goals you’ve set. However, this efficiency can’t be achieved if your employees use other programs to generate spreadsheets or non-integrated systems like QuickBooks instead of the ERP software because it can’t handle such tasks. As a result, you’re prone to making errors that lead to inconsistencies and inaccuracies that could lead to numerous expenses issues in the future.
With a new ERP system, these problems will be a thing of the past. After all, a new ERP system will integrate the functions of multiple departments. Therefore, you won’t need separate management tools to run your company, which further streamlines your company’s operations. With that said, you can still integrate other platforms such as QuickBooks into modern ERP systems if you specifically want to use them.
5. ERP System Is Too Complex
Your staff is vital to the success of your business, so you should always ensure their productivity is optimal. However, they can’t accomplish their tasks with a lousy and complicated EPR system. With outdated or unoptimized software, your employees will have a rough time as they try to navigate and finish their assigned duties on time. This might necessitate you to invest in additional training to help them better understand how to use the ERP software efficiently. It may also lead to high staff turnover, thereby increasing the cost of running a business and negatively affecting the company’s performance.
A modern ERP software addresses these shortcomings, and it helps improve your employee productivity. This is because your employees won’t have to deal with repetitive processes and extremely slow loading speeds. In addition, newer ERP software has customizable and intuitive interfaces, which further simplifies ease of use and accessibility.
Just remember to take the time to choose a reputable ERP vendor. With a respectable ERP vendor, your staff will be sure to get the necessary training on ERP system implementation. This is vital to encourage adoption by your staff, thereby increasing productivity.
6. It Doesn’t Offer Cloud Computing Capabilities
Many companies have realized the immense benefits cloud computing has on their operations. Because of this, many companies have opted to use cloud-compatible ERP systems to get better access to online business solutions. But if you’re stuck using an old ERP software, you’ll need to first buy a license and load it onto servers to be able to use such a system.
With a modern and cloud-based ERP system, you can avoid all these inconveniences as long as you’re connected to the internet. You also don’t need to buy high-performance hardware and licenses constantly, hence lowering your business operational expenses.
An ERP system isn’t cheap. So, given its cost, many businesses resort to using the software for an extended period without replacing it. However, this isn’t usually recommended because the cost of getting a new one will be much less than the expenses associated with using an outdated and inefficient ERP system in the long term. Keep in mind the clear signs discussed in this article so you’ll know when you should go ahead and get a new ERP system.