How Companies Are Accelerating Business by Innovating Around the Edges of ERP

How Companies Are Accelerating Business by Innovating Around the Edges of ERP

As the pace of business change accelerates, businesses are seeking to transform IT to pull out in front of competitors. But you’ve already invested considerable people, time and money in implementing and customizing your ERP technology. How do you keep pace with change and continue to deliver new capabilities, while minimizing risk and ensuring core operations run smoothly and in compliance, without fail? Innovating around the edges of your ERP solutions can provide the agility you want and the dependability you need.

Digital transformation is driving change and new expectations, and you need to innovate faster to drive growth. That means your entire IT landscape must align with your business needs now, and tomorrow. But how ready are your core ERP systems?

Keeping What’s Working in the Core

Stable, proven, core ERP apps from original vendors, such as SAP and Oracle, have dramatically improved the way we do business and are the foundation of business IT. Most Global 500 and 2000 companies have SAP or Oracle ERP systems in place due to their vast scope and depth. But in an era when disruption is everywhere and changes are coming at light speed, they don’t always deliver the new features and capabilities at the speed you need — if at all.

If a company’s technology can’t deliver the performance and responsiveness it needs, sometimes line-of-business teams will sidestep IT with their own initiatives. Gartner estimates 40 percent of corporate IT spend is done outside CIO control. These shadow IT approaches may help tackle business issues in the short term, but they introduce security and management risks, not to mention the burden of supporting and ensuring these systems continue to run in the long term.

Many companies are embracing a hybrid approach to ERP to get the business agility they need, while minimizing risk and ensuring smooth operations. With a hybrid ERP approach, you keep some resources on your existing infrastructure, while expanding to cloud-based services for others. You can keep what’s working in the core and take advantage of new technology in the cloud around the edges. A hybrid approach lets you access the innovation you need, while minimizing cost and risk. And it enables you to support a phased implementation of new customer experience capabilities, pacing your roadmap evolution based on the funding and skilled resources that you have available.

Aligning Your Environment and Processes to Your Business

A hybrid approach deconstructs traditional ERP, transforming your organization to a postmodern ERP model that’s free to innovate while still the backbone of your operations. Your competitors are innovating right now, and the pressure is on to deliver new capabilities such as mobility, big data analytics, support for social networking and improved user experience.

You can’t afford to wait to innovate, but traditional ERP vendors might take years to fully deliver the features and capabilities you need to enable new business models for the digital world. That can lead to unknown costs, unnecessary disruption, an uncertain path forward and potential lost functionality.

Meanwhile, the core ERP apps and processes that you’re using now are extremely robust and are customized to your unique business needs. You may have a core system in place today that’s running well but might want to enhance it with new cloud, social, mobile or big data capabilities. A hybrid approach lets you use the best apps possible in the areas you need — while ensuring they are integrated and compliant.

A Smart Way to Boost Business Agility

With the right strategy, you can maximize and extend the lifetime value of your mature, functionally rich ERP applications — and take advantage of innovation at a faster pace than the status quo.

For example, a global printing systems manufacturer was looking for a way to reduce its SAP maintenance costs and free up its IT team to focus on initiatives that improved its business. The firm shifted its IT focus from technology support to business improvement, hiring Rimini Street to support and maintain its SAP back-end systems, and freeing up its small IT staff to innovate and modernize the business.

“My team has been able to spend more time on business improvement instead of technology support, and that’s really the end goal,” says the director of global applications and solutions. Now the IT staff of four can evaluate and implement innovative solutions that help modernize business processes.

“We’re now able to take on things like implementing Concur for travel and expense management, reviewing and implementing SAP’s Warehouse Management at one of our sites, and customer-centric solutions like implementing Salesforce and integrating that to SAP. Certainly we wouldn’t have been able to take on Salesforce without the savings — and we wouldn’t have been able to do it with the resources we had under the old support methodology.”

The movement toward hybrid IT is gaining momentum across industries. In Gartner’s survey of more than 300 CIOs and IT leaders during its 2015 Gartner Symposia, analysts found an overwhelming 82 percent were taking a hybrid IT approach to transformation.

It’s clear that today’s digital economy is driving dramatic changes and creating unprecedented challenges. But with the right approach to your ERP strategy, you can build a more nimble business that can take advantage of rapid change and transform it into competitive opportunities.