When Should I Replace My Existing ERP Software?

Let's examine when it's time to consider replacing existing ERP software. There can be a number of symptoms that will help point someone to realize it's time to evaluate and implement new ERP software. Some examples include:

• Current software can’t match existing business processes - this may have existed from day 1 of new software, and the gap may have continued to widen over time with the new solution.
• The business is changing and software can’t enable this change - as the business changes, new processes can get introduced which help enable that business to be competitive in new markets with new customers.
• Lots of off-line processing (i.e., spreadsheets, manual processes, re-keying of data multiple times) - if the existing system doesn't allow someone to get their job done, they tend to find ways around the system to do so. Unfortunately, these inefficiencies can eat substantial amounts of time and can create data inaccuracies as the "same" information is entered multiple times in disparate systems.
• Have lots of “data” but can’t get “information” out of the system - analyzing information is critical to continuous improvement and attracting / maintaining good customer relationships. One can get handcuffed by have a data rich, information poor environment.
• Can’t easily implement new functionality or technology (i.e., RF/barcode, EDI, warehouse management, CRM) - there may be improved efficiencies to gain and/or new customers to attract by making it easy for them to do business with you. Many times, technology is a key enabler to making it easy for your customers to interact and transact business with you.
• Existing software and/or underlying infrastructure is no longer supported by the associated vendors - as there have been massive amounts of acquisition in the ERP market, there are lots of ERP solutions which were thought of as "flagship" solutions that are no longer receiving an adequate level of investment to keep existing and attract new customers. One's vendor may have "dropped support" for its software without doing so in a formal way with its customers.
• Can’t keep up with business demands by writing custom software vs. using packaged software solutions - for those who continue to write their own custom software, there are so many "commodity" processes that one could enable via packaged software while still gaining the benefits of customized software in those "competitive advantage" processes. Unfortunately, most companies who have a "build" vs. "buy" approach to software do so across all business processes, and either pay a lot for "commodity" processes or can't get resources focused on the "competitive advantage" processes due to keeping day-to-day operations running.

As a means to help businesses evaluate whether or not it is time to replace their existing ERP software, Technology Group International has published a White Paper entitled, "How to Tell If You Have Outgrown Your Existing Business Software" which is available from TGI's Web site at http://www.tgiltd.com/How_to_Tell_If_You_Have_Outgrown_Your_Existing_Business_Software.pdf.