This article explores the evolution of ERP toward the cloud – now serving the needs of the digital economy and supporting the end-to-end customer experience. We are interested in your perspective. Please take our survey.
Since the 1980s, many companies, including SAP, have successfully shaped and anticipated market trends and helped countless businesses run better. As new megatrends emerged or were inspired by global players, we relentlessly drove the IT industry to solve the next decade’s needs. The achievements created during one megatrend became the status quo for the next, providing the building blocks to an even more innovative way of tackling the next generation’s problems, meeting new demands, and driving businesses to work increasingly in real time.
What is ERP?
ERP systems originally focused on automating back-office functions. In 2000, ERP was declared “dead” and reinvented within the same article. Gartner described web-based software that provides real-time access to ERP systems to employees and partners, including suppliers and customers. The new ERP expanded traditional resource optimization and transaction-processing; rather than just documenting the physical reality, it became a connected platform to interact between enterprises.
Later, ERP was coined dead many times – and for sure, it will be again. This contrasts with the experience provided by classical enterprise solutions, which are designed to keep the enterprise integrated and ensure consistency and execution of critical processes. The undisputed success of ERP speaks for itself.
But unfortunately, when these enterprise solutions became more popular and attracted more users, user experience did not keep up. The 1990s were the decade of IT, not the business user. Yet the architecture, as well as tools to describe processes, do support high complexity and strong, tailored individual processes. This process-centric approach allows visualizing and executing unlimited complexity and individuality. It has helped and will continue to help organizations execute processes with the highest efficiency.
The rise of “best of breed”
In the cloud, solutions need to deliver nothing less than a first-class user experience combined with back-end orchestration to ensure data and process integrity across the enterprise. These solutions need to support fast decision-making: Like it, keep it; don’t like it, toss it.
To keep pace with fast-changing markets and the demand for a new, much more end-user-oriented setup, one megatrend of the last decade was the move towards solutions geared for the line of business (LoB) and buying decisions.
Once using the solution, the user wants a single and simple experience: “What is in for me?” A people-centric approach is the key to adoption. This trend was important, but also had its tipping point when cloud, as well as first-class consumer experience, became ubiquitous.
Now, as these LoB markets have been settled in favor of software-as-a-service (SaaS), and SaaS markets in favor of LoBs, we again see the world changing in time lapse.
In a fully digitalized world, the economy is about the end-to-end experience. The new technical possibilities and customer behavior make the digital storefront a must to compete and ultimately survive. Companies want to be where the customers are. It is a logical consequence of the “segment of one.” Customers want to be treated as individuals, not in a segment with others.
But what’s next after digitalizing your storefront? It creates a huge new promise to the market.
“Dear Customer, I am a service-oriented company, and I will treat you exceptionally well.”
Sailing on the back wind of this promise, most companies sit on scattered data sets and solutions without the ability to plan, execute, and steer their businesses in real time. The whole enterprise value chain became a highly fragmented collection of best-of-breed solutions, impossible to be run and steered in real time.
At the same time, the definition of ERP became volatile in the market: from postmodern ERP definitions that stopped beyond core HR and finance to a mature federated suite – transforming into a digitalized core-to-edge definition. When companies consider moving their ERP to a SaaS solution, it is driven by the need to get far beyond a new deployment option. It is transformational to reinvent cloud ERP, serving the needs of the digital economy.
Integrated end-to-end business processes: the currency of cloud ERP
Customer-centricity and great customer touchpoints are top-of-mind for all enterprises, but fulfilling the strategic requirements must become integral to operational excellence. Companies can struggle to deliver on the new promise to their respective markets – to deliver their products and services as expected.
An SaaS cloud ERP is surrounded by a complete enterprise value chain to run as an intelligent suite, no doubt. But there is a core that supports the managerial process (planning, execution, and control) of enterprise resources to satisfy customer demand at optimal financial performance.
Cloud ERP is the enterprise management platform in the cloud, tasked to enable integrated business management from planning to execution across all core end-to-end processes at scale. The system is designed to support the managerial process: the planning and control of enterprise resources to satisfy customer demand at optimal financial performance along with core end-to-end business processes.
Your voice counts: please take our survey
We are conducting a survey to collect our stakeholders’ points of view about cloud ERP. The survey will take you about 10 minutes.
Your answers will be strictly confidential and used for evaluation purposes in an anonymized form. Read more details and provide your agreement in the declaration of consent.
Please access the survey here.
We are looking forward to receiving your feedback. I will share the results in an upcoming blog, as well.
Growing companies are embracing a significant shift in how they derive insights, run business processes, and make decisions. Learn about “Intelligent ERP: A Growth Opportunity For Midsize Companies.”