Combine traditional core systems with new, fully integrated cloud services
In 2022, the German industry was faced with various challenges, including the COVID-19 pandemic, the war in Ukraine, and the resulting resource and energy crisis. This had a huge impact on classic fields of ERP like procurement, materials management, corporate performance management and logistics. How can you deal with such situations and brace yourself for these challenges in the future? We've identified five ERP trends for 2023 that small and mid-sized manufacturing companies should keep in mind.
"2022 has clearly shown where ERP systems must better support companies: companies have to be able to react to the geopolitical and economic situation with more speed, flexibility and adaptability. And then there are also regulatory requirements that demand new functions, processes and innovations. You'll have to follow the looming trends if you want your company to be better prepared for future crises and the increasing number of regulations to remain competitive."
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Michael Finkler, Head of Business Development at proALPHA |
These are the top 5 ERP trends of 2023 companies should keep in mind:
- Respond rapidly to crises and political regulations
The biggest challenge is to respond rapidly to fast-changing situations, for example supply chain issues or increasing energy costs. This capability will be the crucial competitive factor in the future. Moreover, the political regulations on a national and European level are also becoming tighter for small and mid-sized enterprises. Let's take the upcoming act on emissions for example. Only companies that use solutions for energy and carbon management will be able to map the corporate sustainability reporting required on the national and EU level effective from the fiscal year of 2023. This requires a new and integrated functionality for the ERP system as the central data and process hub. - Ensure supply chain resilience
The resilience of a company depends on the resilience of its supply chain. Especially in times of limited (financial) means and resources, the ERP system used by the company is gaining importance. As the digital backbone of a company, it plays a crucial role in holding together partner ecosystems, integrating supply chains and ensuring smooth production. Classic production planning might be seeing a renaissance here. - Boost innovation by means of artificial intelligence (AI)
Today, the Industrial Internet of Things (IIoT) provides companies with a variety of data sources and volumes for analysis purposes. In addition, hardware and algorithms are improving from year to year, allowing companies to optimize their business and production processes based on AI. Smart and predictive procurement solutions, seamlessly integrated AI-based tools from the cloud, and machine learning make the classic ERP system smarter and capable of automation. - Meet high demand for mobile ERP and real-time data access
In the age of new work, ERP systems must cater to the needs of a workforce that increasingly uses mobile devices. Processes like sales orders, leave requests and project coordination can all be handled on mobile devices these days. The new law on time tracking in Germany highlights the need for a mobile ERP system that can be used across platforms and in the cloud. Real-time access to data, such as smart dashboards for detailed reporting and forecasting, is also becoming a standard. - The cloud for SMEs – rather an evolution than a revolution
Nowadays, full cloud solutions are still quite rare in production. One of the main reasons is that ERP systems are crucial to the business, which means they are not among the first systems to be transferred to the cloud. SMEs are still quite cautious when it comes to cloudifying complex production processes. For example, e-procurement solutions are already mainly used in the cloud, while complex and highly customized applications are still operated on premises. It's therefore more accurate to speak of an evolution rather than a revolution where the implementation of cloud ERP systems or components is concerned. The full potential of the cloud can only be exploited when the industry-specific key processes are successively optimized in the standard version and the ERP solutions allow for more configurability. This is only possible if SMEs go along with this evolution. Providers will have to make sure to adapt to the different digitalization paces of their customers. In short, they have to assist their customers in successively adding new, fully integrated cloud services to their traditional core systems.
