Upgrade Or Clean Slate? Planning Your Next ERP Move

Posted by Ananya Kripalani, Senior Analyst, Enterprise, EMEA on May 12, 2014

planning for ERP

We spoke to a number of leading Professional Services firms this year including accounting, IT and engineering consultancies, and the consensus was that nearly half will begin upgrading their enterprise resource planning (ERP) systems sometime this year.

Indeed, the majority of those quizzed said they schedule to upgrade their systems every two-to-five years to ensure they keep pace with the changing business needs brought about by globalisation, the need to remain competitive and other market conditions.

Future choices

The risk for many of these firms is deciding whether to upgrade their existing business system or bite the bullet and opt for something completely different. It’s a big decision to make, especially when you consider that some companies have used the same ERP platform for nearly 20 years and it is ingrained in their business

Which is fine, until you consider that many of the long-standing ERP systems were developed for a wide variety of businesses and organisations. In some cases - with the help of customisations and integrations - these generic ERP systems may do an adequate job. However, why would any global company settle for an adequate system that only provides adequate returns, when there are industry-specific ERP systems on the market? Like those that have been developed specifically for professional services firms and, as a result, include a level of functionality that is not available in more generic one-size-fits all platforms, ensuring better user adoption, increased efficiencies and improved ROI.

Profit boost

Ask yourself; are your employees having to adapt themselves to the ERP system rather than the other way around? Are employees working outside their ERP system or with disparate add-ons? If yes, then perhaps your system is out of date. Are you able to foster innovation, drive down costs and see quantifiable return on investment (ROI)? If not then it's certainly time to consider change.

Think of it this way - installing an ERP system that can optimise your order-to-cash process could save tens of thousands of pounds – even millions – each year depending on the size of your firm. The same system could help slash the amount of time it takes to integrate a new business following M&A activity. According to our research, it can take upwards of a year to integrate a new business, potentially damaging revenues and causing havoc in what should be a time of market domination. However, the adoption of an industry-specific ERP system will cut such integration to days not months.

It's reassuring to know that 93% of Deltek clients who have adopted a purpose-built ERP system specifically designed for their industry have seen a quantifiable ROI. While it may be difficult to justify the investment of a change in ERP to senior executives, you have to remember the trade-off, which in so many cases has been financial success on margin. Sometimes, a cathartic clearing can allow a company to move from simply surviving to thriving,