Looking beyond monolithic ERP

Infor suggests a new breed of ERP is delivering social tools

  • E-Mail
Looking beyond monolithic ERP Angove: Modern ERP needs to be flexible, cloud-ready and make use of new approaches.
By  Duncan Angove Published  March 10, 2013

Successful business demands the ability to exploit new capabilities and technologies without delay. Take Dell, which saw sales rocket when using Twitter to sell discounted laptops. Furthermore, the US National Transportation Safety Board, responsible for investigating civil aviation accidents, has recently standardised on the Apple iPhone and iPad to boost productivity of field and office-based staff. The lesson is simple. No one can afford to be caught sleeping in the face of developing technologies. But the question is how many businesses have the ability to be flexible and embrace these opportunities when they are constrained by antiquated IT systems?

Out with the old…

From a basis in materials requirements planning (MRP) programs written in the 1970s, ERP systems have seen widespread adoption over the decades, and ERP capabilities have extended to embrace e-commerce and supply chain activities. While this extension of capabilities was great in theory, the reality of these ‘one size fits all’ suites was somewhat different. ERPs became bloated with too much functionality, and the level of complexity involved resulted in highly expensive implementations, often spanning several years.

Another major shortfall of these systems was that they failed to accommodate the specific needs and nuances of different industries.   This lack of functionality meant more complexity as many organisations resorted to extensive modifications in order to ensure they support their industry’s needs.  These heavily customised solutions have also become an enormous liability, by inhibiting companies from upgrading to the latest versions of their software. Companies have become too scared to change and lose their customisation work or break the ‘hard-wired’ integrations they have built to their other systems. Effectively many companies have built a monster that they dare not touch. Any attempted upgrade to one of those applications or integrations could take down the entire system.

However in a modern business climate where the currency is speed and agility, to allow this situation to perpetuate poses an even greater risk to the business. The good news for businesses is that an ERP revolution is already gaining momentum. It has taken a decade to address this shortfall, but the ERP industry now finds itself on the verge of genuine revolution in the way ERP is delivered and adopted.

..…and in with the new

Modern, deeply functional, vertical industry-oriented ERP software is already available. Vitally, these new applications contain many of the industry functions that had to be custom-built in the past. So a baker needs no longer to customise a generic food ERP, instead they get a specific application that accounts for idiosyncratic business processes. And this is out-of-the-box, saving time and cost on implementation. So companies need no longer hang onto those precious, old industry customisations.

Of course companies do ask: “How can it work in practice? Why would a business risk a failed IT project and bring the business down?” These are all genuine questions that get raised every day. But we are now operating in ‘the Internet age’ where applications are expected to work together, anywhere, any time. If a few Internet sites go down, does it bring down the entire World Wide Web? No, of course not. That’s the way business systems are now designed today. The basis of the Internet is a loosely-coupled architecture using standards-based applications like XML, and this principle has now been introduced into application software design and is inspiring this new evolution.

The ‘techie’ bit

So by disposing of hard-wired integrations, in favour of a loosely-coupled architecture, where applications simply generate and transmit XML business documents, companies can upgrade systems as many times as required — without ‘open heart surgery’ on the ERP system — maintaining the necessary links to other applications. (In fact, hundreds of Infor customers are already benefiting from receiving small, regular upgrades to their software every 6-8 weeks, removing the headache of planning and executing the old style of doing a major upgrade every few years).

A loosely-coupled architecture provides enormous flexibility when it comes to adopting cloud-based solutions. For example, a manufacturer may feel protective and prefer to run its existing business critical ERP and financial systems on premise alongside ‘edge’ applications in the cloud — such as HR or time and attendance in order to deploy quickly and enjoy the lower capital expenditure. Or perhaps deploy a cloud-based Expense Management system, which is not core to the business and might only be used on occasion.

Such a hybrid environment provides the comfort, flexibility and choice according to that company’s needs. So a company can upgrade one application without affecting the others. It can even chose to upgrade an application into the cloud during the deployment and testing phase and then switch back on premise or maintain the application in the cloud in perpetuity. The choice is theirs to make — not the vendor’s.

The cloud is increasingly popular as a ‘sandbox’ or ‘sandpit’ for the initial testing, user training and pilot phase before committing financial resource to an on-premise deployment. UK based hi-tech manufacturer Oxford Instruments recently did exactly this with its recent deployment of an integrated Infor ERP and PLM solution.

Fundamentally due to the loosely-coupled architecture, cloud and on-premise applications still talk to each other and integrate intelligently. Critically, any such diversity in the background makes no difference to the user experience. Users are unaware if the information they receive comes from an on-premise application, from the cloud, or from a hybrid deployment of both.

Modern ERP means social ERP

The workforce of today is used to accessing the likes of Facebook from a mobile phone or tablet and gets a consistent, familiar Amazon experience anywhere in the world via the web. They can communicate and connect on the move and critically, they are now demanding the same of their workplace software.

There is competitive advantage in having an intuitive user interface (UI) that can enhance navigation, smooth out communications, reduce the learning curve, enhance the user experience and improve productivity. A modern UI can create a ‘social business’ environment where the power of modern social networks, tools and business applications coalesce in a way that can profoundly change the way that individuals work.

Critical to this is the use of a newsfeed which people can subscribe to, rather than using sporadic, ill-targeted torrents of email. Rather like following people on Twitter/Facebook the ‘objects’ being followed within a social business network can include sales and purchase orders, maintenance work orders, customers, invoices, even specific pieces of equipment. The system then alerts the subscriber any time that the object changes state. But essentially, a user can ‘share’ an object within an update to other individuals working in the supply chain of a business.

Critically, this is not simply a social chat stream that resides outside of the business application. Social business needs to be embedded within the application so the objects within the news feed are direct extracts from the application. For instance, a user questioning a ‘suspect invoice’ can click on the object and invoke the underlying ERP application in order to solve the problem in real time.

When sharing an update, the context of that update follows the shared object. This means the receiving party knows the precise context in which the information is being supplied and can act accordingly. This sequence of ‘Follow-Share-Act’ defines this new generation of ERP; with information and work being followed by people, not the other way around, and details can be shared easily across the business, empowering people to act to achieve specific outcomes and objectives.

These social business networks are intelligent as they are designed to utilise the existing network of people, applications, machines and data — even when people are not known to each other. The system can proactively connect people on a ‘you need-to-know basis’! Using knowledge of all the necessary connections between people/departments in their specific job roles, a ‘social graph’ can be created in any enterprise for the system to map.

A social business enabled ERP offers intense collaboration capabilities and thanks to the ease of integrating mobile into ERP there are even more options for travelling executives.

Conclusion

ERP is itself the result of a technological evolution — the original manufacturing planning systems of 30+ years ago that led to ERP are largely now confined to the realms of legacy applications. In the face of huge opportunities for smarter, faster, more agile ways of working that can capitalise on new opportunities, businesses now need to transform the dinosaur of monolithic ERP that sits in their back office into a keen business tool that matches the modern business environment.

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code