Enterprise Resource Planning (ERP) systems are the cornerstone of the organization, enabling IT and finance leaders to integrate and manage their core business processes. However, the pace of innovation and the increasing demands for modern functionality and outcomes today, not in the distant future, are challenging the long-standing assumption that ERP transformation projects must span years and billions of dollars.
Recent announcements, such as a staggering commitment by a food manufacturer to spend $1.2 billion over five years to upgrade its technology stack, on top of 18 months of planning, highlights the potential organizational as well as career impacting decision of this type of big-bang approach. While the concept that one could potentially limit disruption by focusing on individual modules within specific regions might sound prudent, it raises a critical question: Can organizations afford such timelines and investments when the market demands agility and immediate results? And does it create unexpected outcomes, such as vendor lock-in to products, or a multiplier effect on cloud costs?
There are too many recent examples of these types of projects running both over time and budget with significant impacts to the organization, even aiding in the bankrupting of Europe’s largest local authority with a £216.5M loss in a failed implementation disaster.
Leaders must take the time to independently assess roadmaps that are not tied to products, focusing on delivering positive outcomes at a speed and price closely aligned to the business.
Reimagining IT Transformation in the New Age of AI
Imagine achieving a similar outcome to the “big bang” project in just months at a fraction of the cost—$1.2 million instead of $1.2 billion. How? By breaking down core functional areas requiring modernization into manageable components and deploying enhancements incrementally.
Rather than planning for years and risking obsolescence before deployment, an agile ERP approach offers a compelling alternative by emphasizing quick time –to value and iterative innovation.
Bringing more of a software development focus and rapid innovation into this effort, agile ERP focuses instead on delivering tangible benefits in a series of progressive projects that can build from an MVP showcase to a complete functional transformation. Leveraging a modern platform like the ServiceNow AI Platform for Business, and packaged intelligent experiences and workflows for an operational areas such as Accounts Payable, new experiences for both employees, suppliers and clients can be introduced rapidly, allowing team members, suppliers and clients to provide input while additional functionality and use cases are deployed.
Breaking Down the Big Bang: Lessons from the Traditional Model
This five-year project example also reflects an “all in” move to a single technology vendor roadmap and this approach highlights some significant potential drawbacks:
- Extended time to value: Five years is a lifetime in today’s technology environment. Capabilities and new technology are rapidly being introduced, and customer expectations continuously evolve. By the time such a transformation is completed, the intended outcomes may no longer align with stakeholder needs.
- Disruption risk: Even phased rollouts can introduce disruptions, especially if dependencies between modules are underestimated. The cumulative cost of these disruptions can erode the projected return on investment (ROI). This is also not a static project as many of the functional areas are dependent on other systems, which they themselves may be undergoing a potential move to the cloud or SaaS. Integrations, access and entitlements and new security concerns can be introduced.
- Getting locked out of new innovation: The fine print on products may not include the inability to adopt the latest technology due to compatibility matrix complexities, or because the system is inflexible to change. That means when new innovations hit the market, you may be locked out of being able to benefit from the feature you really want.
Agile ERP: A New Way Forward
An agile ERP approach turns the traditional model on its head, prioritizing rapid, iterative development to achieve quick wins. By focusing on smaller, high-impact projects, businesses can deliver meaningful results in months, not years.
Breaking down core functional areas requiring modernization into manageable components and deploying enhancements incrementally fosters:
- Reimagining the user experience: Agile ERP projects introduce transformative changes to user workflows, from a catalog of user services and procurement analysis to supplier interactions and client value chains. ServiceNow’s Source to Pay Operations enable seamless automation, integration, and real-time visibility across these processes.
- Leveraging expertise: Rimini Consult™, Rimini Street’s professional services offering, bring deep domain knowledge to assess current landscapes, envision optimized value streams, and deploy scalable solutions. This ensures that transformations are not only strategic but also actionable and impactful.
- Accelerating deployment: Unlike multi-year projects that spend 18 months or more in planning, agile ERP teams deploy and refine solutions as they go. By the time traditional planning is complete, agile ERP users are already experiencing benefits, gathering feedback, and optimizing workflows.
Transforming Costs into Value Streams
An agile ERP approach doesn’t just save money—it turns costs into opportunities for growth. Here’s how:
- Small, self-funding projects: Agile ERP projects often pay for themselves by delivering quick wins that reduce costs or generate new revenue streams. For instance, automating procurement processes can slash PO processing time and costs.
- Real-time visibility: By leveraging platforms like ServiceNow, organizations gain immediate insights into their operations. This visibility allows leaders to identify bottlenecks, track KPIs, and make data-driven decisions.
- Scalable transformation: Starting with one department or process enables businesses to refine their approach before scaling to other areas. This ensures smoother adoption and better ROI.
A Call to Action and a Time to Consider
If you’re wondering where to start, ask yourself these questions:
- Do we know the true cost of processing a single PO or resolving a dispute?
- How many manual steps and shared email boxes dominate our workflows?
- What is our cycle time for critical processes, and how does this impact our operations?
- Do we have the visibility to identify and prioritize areas for improvement?
If your answers include “I don’t know” or “I wish we did,” it’s time for a conversation.
Rimini Consult’s experts can help you assess your current technology landscape, identify opportunities for improvement, and envision a future where agility and innovation drive your success.
Contact us to start your journey. Let’s envision, develop, and deploy your transformation—before the traditional planning phase is even done.
We’ll Get You there
