8 Signs It’s Time to Upgrade to a Better ERP SystemThu Nguyen
Few things are so daunting a prospect as a large-scale change in your ERP system. After all, the average ERP implementation project usually lasts around 6 months, some even 2 years. Likewise, the upgrade might take a few months, too. However, it is crucial and in many cases inevitable for the company’s growth. In this article, we’ll explain eight warning signs that indicate it’s time to upgrade.
Personnel is easily a company’s most significant cost. Once you factor in salary, benefits, employee development programs, the hiring process, personnel typically far outpaces anything else you spend on.
That’s what makes the right ERP system so crucial for your business. An ERP system that requires much manual processing to run on a day-to-day basis can negatively impact your employees’ productivity.
Not to mention, a plethora of manual processes also indicate a lack of scalability. So as you grow, your ERP won’t grow with you, and will instead require even more unproductive time from your people.
Reporting easily takes the cake as one of the most important functions of any ERP system. Thus, if your current ERP doesn’t enable you to quickly and efficiently view the most important metrics, it’s probably past time to upgrade.
Access to metrics is crucial to your company’s success. After all, without the right reporting, there’s no way for you to tell if your company will achieve its goals.
Few things kill a company’s growth momentum than a setback when audit time rolls around. Many smaller ERP tools or homegrown systems are unable to keep up with the ever-changing, ever increasingly-stringent requirements to maintain compliance. One slip-up here can be devastatingly expensive for your company.
Especially if your company currently or in the future would like to engage with any government contracts, you’ll need to ensure beforehand that you meet the strict compliance measures. Thus, it’s better to get the ERP upgrade out of the way now before that becomes a possibility, rather than have to miss out an opportunity down the line because you aren’t yet compliance-ready.
For the past few years, we’ve been saying that mobile is taking over. I’m here to tell you that today, mobile has taken over. Your employees are always on the go but also always have access to their smartphones. If your ERP system doesn’t have the mobile capacity, then you’re potentially missing out on hours of productivity.
How advanced is your tech stack? If your company is in any sort of high-tech or SaaS industry, part of the territory is a massively complicated tech stack to support all of the different functions of your business. Integrations are key for your employees to most efficiently leverage that tech stack to excel in their roles.
Having to constantly navigate between or manually send data across two different systems kindles unproductivity. If your ERP doesn’t play well with all of the other tools in your tech stack, it’s definitely time for an upgrade.
Though there may be myriads of technical, tangible factors of employee productivity, many of the elements that influence how well your personnel works are the intangibles, like morale. Don’t wait till your employees constantly complain about your current ERP and find it hard to do their job.
If someone’s motivation to work is being adversely impacted, you’ll get nowhere near 100% productivity from them. Don’t let your ERP be the root cause of a lack of morale.
Any large scale change to your organization, such as an overhaul, upgrade, or re-implementation of your ERP will require buy-in from upper management. Creating that buy-in is best done by building out a business case for the ERP upgrade.
As you build out that business case, you’ll be able to see the prospective ROI to make a well-informed decision. Take into account all of the systems and functions that you plan to upgrade. Then compare the future state to the current state. How many hours per employee does each new or improved function save? How much is each hour worth? Will the impact of the new tool lead generation for your marketing team or conversion rates for your sales team?
Leverage the answers to all those questions while building out your business case. In the end, assess the RoI and see whether it outweighs the cost of an ERP upgrade. If it does, making the jump and committing to the improvement process is certainly a no-brainer.
The last but most tell-tale sign of an insufficient ERP system is an adverse impact on customer experience. As you well know, customers are the lifeblood of your organization. Your customer base waning means your organization’s death.
Research reveals that positive customer experience results in increased customer longevity as well as word-of-mouth marketing. A happy customer who enjoyed the experience of working with your company will also tell his/her friends about his/her positive experience. The net result of that means more dollars in your bank account.
But the opposite of that is so much truer. Customers are even more likely to share negative buying experiences than positive ones. Thus, if you’re providing a poor experience, your market will soon know about it. That’s why it’s absolutely crucial that you upgrade your ERP if some parts might contribute to adverse customer experience. Whether it causes a slow response time from your sales team or an overcomplicated purchasing process, it has to go.
If these warning signs show themselves in your organization, then it’s beyond time for you to consider upgrading your ERP. Daunting though the prospect may be, a dedicated team can help you implement your system upgrade easily and quickly.