For some manufacturers, a new ERP system isn’t in the cards right now. But several experts say that staying with their tried-and-true legacy ERP doesn’t have to mean forgoing the process improvements and advanced features of more modern platforms.
They recommended several best practices for getting better use of an existing system.
Get current with an ERP upgrade
Since many manufacturers do not run the most up-to-date version of their application, merely upgrading a legacy ERP system to the current version can add benefits without much additional cost, said Murali Raghavan, executive vice president for iGATE Patni, a consulting firm with operations in the U.S. and India.
“You can get a lot of technical advantages by upgrading, including better integration with point solutions,” Raghavan said. Regardless, there is no way around upgrading if your version is about to go out of maintenance. Everyone loves to hate upgrades, but upgrading needn’t be too expensive or time-consuming, and the vendor is likely to be motivated to help with special incentives for sticking with legacy ERP.
Try two-tier ERP
Companies that decide not to do a wholesale migration to an on-demand or Software as a Service-based ERP solution can dabble with on-demand ERP for a specific function. Using a “two-tier” model, they can keep their legacy ERP system chugging along while using cloud ERP in spots for a specific function, experts say.
For example, they can quickly dip into an on-demand e-commerce tool to finally get an online store off the ground. The on-demand platform should have “hooks” that make it fairly easy to integrate back to the core ERP -- and the company can hand that task off to its provider and not worry about it.
Implementing ERP in the cloud for a specific purpose can be an efficient way to deal with changes in an industry, such as new regulations, said R. “Ray” Wang, CEO of New York-based Constellation Research Inc.
“You probably don’t have the staff to handle the constant updates. It’s more than reasonable to implement cloud to deal with these changes,” Wang said. “We are seeing many of our clients use two-tier ERP.”
A best practice for two-tier ERP: Before making the move, create thorough process maps documenting every touchpoint that will exist between the ERP system and the cloud-based function. Though the integration is not likely to be difficult from a technical standpoint, the effects can be more far-reaching than companies realize, Wang said. The cloud service provider should be able to help.
Companies attempting to add Web functionality should also spend some time on change management and training in advance, Wang said. “While the old [ERP] systems might be a little creaky, they’re very fast. A green screen is so much faster than a Web screen,” he said, so companies need to prepare affected workers in advance.
Running on the most recent version of the core ERP application and adding on-demand capabilities where needed can provide the best of both worlds. “The key is not to let your ERP system become stagnant,” Raghavan said.