Perception of ERP needs to change if more organisations are going to adopt the technology.
That's according to Steve Tattum, product manager for Sage ERP X3, and Matt Muldoon, ERP expert and director of consultancy Clear Business Outcome, both of whom were speaking as panellists on a Computing web seminar discussing ERP yesterday.
Further reading
Research: businesses adapt ERP to tackle diverse demands BBC to refresh ERP estate The face of Modern ERP
Responding to a live Computing poll, 31 per cent of web seminar viewers said their organisation felt an ERP solution would be useful, but would be too expensive or complex to implement, something the panellists believed is a misconception.
"We have to change the perception of ERP, it's something that moulds to your business and not the other way around," said Muldoon, who pointed out that these perceptions are rooted in the giant monolithic Tier 1 implementations of the past and the unfavourable headlines these have sometimes generated. As a very broad generalisation, Tier 1 ERP solutions (such as Oracle and SAP) are used by organisations with more than 2,000 employees while Tier 2 ERP tends to be designed for medium to smaller firms - with 50 to 2,000 staff according to Tattum.
With reference to the way that Tier 1 ERPs can sometimes lead to inflexibility, with organisations finding themselves adapting processes to fit the software rather than the other way around, Muldoon quipped that "Tier 1 systems mould like jelly but set like concrete, while Tier 2 applications are more like modelling clay".
In other words, large ERP systems may be fantastic when new, but are not well suited to cope with change. Meanwhile, modular Tier 2 systems (such as those provided by Sage and other vendors including Microsoft and Epicor) retain a degree of flexibility and are easier to modify as the business changes.
Tattum agreed that for most people their picture of ERP is formed by stories of expensive failures in the press.
"I think it's a perception in the marketplace and of course the newsworthy stories are about big failures, big projects overrunning and there's a risk and fear factor," he said.
"Subsequently you see reports that 25 per cent are unhappy with the ERP that they have, but this is because of systems being imposed when they're not a good fit," Tattum continued.
"Many would be very surprised how cost-effective an ERP system can be," he added.
The key to running an ERP system successfully, the panel agreed, was to not impose one inflexible system from above, but rather build in flexibility from the start. The Computing web seminar audience remains somewhat sceptical about the benefits of an ERP solution, with 40 per cent revealing that their organisation isn't running any sort of ERP solution at all.
The web seminar ERP2: This time it's personal is now available on demand.
