How to prepare your ERP system for the future
Business as usual – as if! Hardly any company expects to continue on its path from spring 2020 when the pandemic is over. One of the reasons is that the past year has significantly accelerated digitalization. It's about time to make the ERP system fit for the new future, thinks Gunnar Schug, CTO of software provider proALPHA.
Even die-hard traditionalists had no way of getting around home office and video conferencing in 2020, the year of the corona pandemic. "This is only the tip of the iceberg where digitalization is concerned," says Gunnar Schug, CTO of software provider proALPHA. There is still a lot to be done on a large scale, especially regarding ERP systems. His tip: To ensure your success even five years from now, you should target the seven most essential issues relevant to digitalization in 2021.
1. Crisis-proof your supply chains
You always rely on stable and legally compliant supply chains, whether they have a low or high vertical integration. Reliability, compliance and sustainability are just as important as the terms and conditions offered by potential suppliers. The seamless traceability of lots and serial numbers is important as well since it allows you to swiftly take action in the event of a problem by recalling exactly the affected goods.
2. Attract specialists
The demographic change has small and mid-sized companies compete for young talents just as for experienced specialists. An attractive workplace comprises a pleasant working environment and state-of-the-art software with a modern user interface. According to a survey by Trovarit, 45 percent of the participants consider usability an important trend for 2021, making it one of the top 3 ERP issues. The use of mobile apps and end devices, whether in field service or production, is almost as important to the interviewed companies and came fourth in the survey.
3. Establish a mobility strategy
The majority of companies is convinced that the expansion of the 5G network opens up all new opportunities. You can get some inspiration for your own company from various use cases laid out in the guidelines provided by the VDMA (German Mechanical Engineering Industry Association) in 2020. They describe various 5G scenarios, from positioning in intralogistics to predictive maintenance.
„Companies with full order books tend to neglect the digital transformation“,
4. Automate workflows
"It's working – kind of." This reply might have still been tolerated in 2019/2020. In the long term, however, inefficient processes affect productivity and hence competitiveness. Half of the companies interviewed by teknwology | PAC on behalf of proALPHA are indeed aware of this. But where to start? Which processes should be targeted? And how to increase efficiency? More and more companies find their answers in process mining and the use of robot process automation (RPA).
5. Open the doors for AI
Every second company with more than 100 employees is convinced that AI is the key to their competitiveness. Companies can now gain their first hands-on experience with ready AI solutions, for example, with AI-based knowledge management in their service division.
6. Take data quality seriously
A vast majority of small and mid-sized companies in Germany thinks that by continuously improving the quality of their data, they increase the efficiency of their processes. At least this is what they stated according to the PAC survey. However, it is not about what someone thinks but what someone actually does. "It's time to let actions follow," says ERP expert Schug. Especially since the success of the Industrial Internet of Things or AI projects largely depends on the quality of the data.
7. Explore the options of platform economy
According to a survey by Bitkom from May 2020, more than half of the companies are currently developing new products and services or intend to do so in the future, the majority relying on platforms for this. 88% create new digital platforms, develop them further or contribute to their development. Others develop additional business models, for example, by offering their products and other services for rent. Modern ERP systems not only have to support and map this transformation, but are also capable of doing so.
Various surveys from last year have shown that the coronavirus pandemic has fueled digitalization around the globe. Gunnar Schug considers this a wake-up call for German SMEs: "Companies with full order books tend to neglect the digital transformation. These companies run the risk of being left behind in the long term. It's about time to target the digitalization of their processes and the modernization of their ERP system."