The Promise of ERP Transformation
Organizations today face significant challenges when relying on existing ERP systems that are 10 to 20 years old. These systems, while rich in data, often struggle to support modern business processes and provide the type of user experience and visibility operational leaders require, leading to inefficiencies and hindering growth.
Organizations said their ERP systems have improved the efficiency of their operations underscoring the need to modernize core capabilities via an agile methodology that can adapt to changing business requirements rather than a direct replacement that can create challenges in meeting the evolving expectations of stakeholders.
By integrating advanced technologies such as automation and AI, senior leaders can unlock new value, streamline process steps and reduce manual tasks without needing to rip and replace entire ERP systems. This approach can improve operations, provide valuable insight into operational data, and allow companies to reposition themselves for sustained success in an increasingly competitive and accelerated world.
The Pitfalls of ERP Transformation
Transforming ERP systems is a powerful move, but not an easy one. Embarking on an ERP reimplementation journey is fraught with challenges that can derail even the most well-intentioned initiatives. that 70% of ERP transformations will fail and 22% will fail catastrophically.
One significant issue is the lack of visibility across large application portfolios. Large IT organizations often have hundreds, if not thousands, of software systems, making it challenging to make modernization decisions without the necessary quantitative and qualitative data.
Additionally, the complexity of integrating a system to the core ERP poses substantial risks. Primary issues include a lack of documentation, lack of SMEs and knowledge on the integrated systems, and a gap in the technology skills.
These challenges highlight the importance of a thorough application inventory, PI planning, and stakeholder alignment to mitigate potential pitfalls. To navigate these challenges successfully, organizations must secure executive buy-in and adopt an agile and composable transformation approach.
Making the Smart Choice: How to Maximize ERP Value with the Right Approach
Embarking on an Agile ERP transformation requires careful consideration of various factors to maximize value. One of the primary challenges is where to start. Determine how to identify and prioritize a list of the most impactful projects while also looking at which projects can deliver the quickest time to value with the least disruption to the organization.
To maximize value, organizations should focus on aligning their ERP transformation strategies with business objectives, identifying quick wins which highlight the value blueprint and potential to extend into other areas in a timely fashion. This outcome-focused approach helps ensure that the transformation delivers sustainable value and positions the organization for long-term success.
Combining AI with current ERP systems can significantly enhance decision-making capabilities. By consolidating data from various departments into a unified platform, AI enables real-time insights and comprehensive analytics, leading to improved strategic planning and overall business performance. This underscores the transformative potential of AI in driving business success.
Also, by leveraging this approach, operational leaders can identify potential value showcase examples that can be quickly developed and deployed, including integrating AI into core processes.
The Payoff of Agile ERP Transformation
Embracing an Agile ERP transformation approach offers organizations the opportunity to modernize and enhance their processes, improve efficiency via automation, and respond swiftly to market changes. Successfully implementing this transformation can lead to substantial benefits, including increased operational efficiency, enhanced decision-making, and improved user experience.
Leveraging Rimini Street’s Smart Path Methodology and strategic advisory from the experts of Rimini Consult™ play a crucial role in addressing these complexities, establishing a solid benchmark of your current state, and creating an agile transformation plan ensuring a smoother transition and minimizing disruptions during the transformation journey.
Here are the public-facing URLs cited in the eBook:
- 66% of organizations reported that their ERP systems have improved operational efficiency:
- Integrating advanced technologies such as automation and AI in ERP systems:
- Challenges in legacy system integration and lack of visibility across large application portfolios: