Enterprise resource planning (ERP) is certainly no new concept, but as ERP evolves from on-premise to cloud-based, are businesses prepared to identify and deploy the systems they need in line with long-term growth strategies?
Since the nineties, on-premise ERP systems have been assisting organisations manage day-to-day activities by tying together a multitude of business processes, such as finance, procurement, project management, asset management, supply chain and operations.
ERP systems continue to be core to ensuring business operations function practically, enabling the flow of data between them.
But as the technology contributing to ERP systems becomes outdated, this combined with legacy business models are preventing organisations from taking advantage of modern technologies.
Matt Fahey, Director and digital transformation leader at Churchill (a Perth-based management consultancy firm), said big investment figures were tied to ERP implementation, yet it was common for businesses to struggle to embed the enterprise-wide technology across their organisations.
“Companies are now forced to adapt either because they’ve been disrupted, or their business model has changed and what they previously implemented no longer aligns with the revised strategy.
“What we know is, they can’t start to take advantage of some of the other digital transformational ideas they have, which will lift their business significantly, until they get their ERP right.”
“It’s about moving from on-premise to cloud-based apps; the proliferation of technology,” Mr Fahey said.
Machine learning, robotic process automation (RPA), analytics and block chain initiatives are some examples of the emerging technologies that are enabled and enhanced by the core of the ERP system.
Churchill director and technology leader Nigel Court said there was no one-size-fits all approach, but each organisation needed to ensure their overarching business strategy came first.
“Businesses need to consider what their ambitions are, where they want to be and how their systems can enable that.
“Churchill has the ability to independently look at that and help create that roadmap,” he said.
A wave of ERP evolution
According to Mr Fahey, a nexus of forces was now emerging where many companies that invested in ERP in the last 10 to 20 years were recognising the need to re-evaluate their legacy systems as part of their broader strategy refresh.
But it’s no longer as easy as calling out to vendors and receiving a flood of potential support. The demand for ERP vendors presents a serious challenge for Western Australian businesses.
“There is a limited number of companies responsible for implementing and managing the delivery of ERP systems in WA, and the wave of transformation required,” Mr Fahey said.
“It doesn’t matter if it’s SAP, or Oracle, or Microsoft, it’s all coming from a small pool of skilled resources across a select group of organisations.
“Given the demand that is coming, and the limitations COVID-19 has created, I don’t think it can be satisfied locally.”
Mr Court said an example of where this had been addressed locally, was where a client had taken very specific actions to secure the right resources ahead of the curve, to guarantee they had the right team in place to execute their project.
The client combined capabilities from multiple vendors to create their ideal team, despite the fact that there was significant demand from east coast mega projects pulling these resources away from WA.
“They’ve understood that they can’t just go to a single systems integrator and have them deliver a complete team, as that capability and scale simply isn’t available within the state,” Mr Court said.
“Instead, they’re looking to engage resources from across multiple organisations to bring its ERP model together in a cohesive way that fits within its strategic timeline and investment profile.”
Executing the strategy
Churchill have a clear strategy-to-solution approach, which means achieving practical beginning-to-end outcomes are at the core of what they do.
In the context of ERP, how the systems are implemented and managed is equally as important as choosing the right systems when it comes to achieving successful outcomes.
Mr Fahey said that in continuing to refine the Churchill digital strategy offering, he saw that programs built by vendors for clients were inherently flawed from the start, due to an overcommitment from vendors in terms of what they would deliver and a propensity to allocate roles back to the client.
“Clients didn’t understand what they were responsible for as part of the deployment process, and as a result a whole bunch of things would fall through the cracks,” he said.
“The service we have created is to offer something that sits in the middle, holding both the client and the vendor ecosystem to a higher account and ultimately ensure the program makes it over the line.
“Our approach is to always maximise the capability of the client as much as we can, but also identify their deficiencies or gaps, which need to be rounded out, and ensure those gaps are covered contractually by vendors and the deployment model.
“We’re not only creating a strategy but we’re also putting the pieces together in a way that cohesively works.”
For more information about how Churchill can assist with your ERP and digital transformation strategy, visit www.churchill.com.au