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Trends for Your ERP Strategy 2021

Reading Time: 5 Minutes 19.11.2020 Press Releases

What decision-makers should consider for the upcoming year

2020 was a very unusual year and it seems 2021 will follow in its path. In such uncertain times, many companies don't plan far ahead. More prudent managers, however, prepare their company's IT for a sustainable future and modernize their ERP system. The software provider proALPHA has identified 10 key aspects based on own project experience and numerous market surveys:

  1. Process optimization
    Almost every second SME has process optimization at the very top of their innovation agenda. This is the result of a 2020 survey by teknowlogy | PAC on behalf of proALPHA. More and more companies engage in process mining to identify the most profitable approaches. According to the survey, 41% see great potential in process mining, and the number is rising.

  2. Automated production
    Industry 4.0 and Industrial Internet of Things have become mainstream. The number of companies which would still not consider smart production only amounted to 1% in May 2020, as Bitkom confirms. However, many companies do not see the finish line yet: 61% of the SMEs interviewed by PAC expect AI to be a prime lever for further improvements.

  3. Artificial Intelligence (AI)
    Speaking of AI, the hyped topic of the last years is finally gaining a foothold in the ERP world with first solutions for service, for example. This is not really surprising since the business models clearly show a trend from product to service. Therefore, it makes sense to equip service as smartly as possible, for example, with knowledge management based on AI.

  4. Business models and platform economy
    In May 2020, a Bitkom survey on digitalization in German production companies has shown that Industry 4.0 has inspired 73% of the companies to not only change individual processes but entire business models. An increase of 14% compared to 2018. More than half of these 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.

  5. Digital supply chain
    The Corona lockdown at the beginning of 2020 has proven that digitalized companies are better equipped to cope with crises. This is the result of a survey by the Global Supply Chain Network (BVL) . ERP functions for supply chain management, for example, procurement controlling and supplier evaluation, become more and more relevant: Which suppliers are reliable and deliver on time? Which might offer discounts, and are they worth limiting yourself to one or only a few suppliers? These and similar questions will come into focus next year.

  6. Sustainability
    Back in July, EY has published a survey according to which 98% of the professional investors base their decisions not only on hard figures but also on "soft" criteria such as quality, environment, and security. Customers also attach more importance to sustainable company management. ERP systems can contribute greatly to the realization of these objectives, for example, by supporting a smarter production which detects outliers in real time and hence leads to a higher product quality and less material waste.

  7. 5G mobility for the company
    The new 5G mobile communications standard allows for corporate mobile networks. Hence, large data volumes can be safely transferred in real time. According to Bitkom , 73% of industrial businesses consider 5G important, 36% of them even "very important" to their own business. In 2020, the VMDA (German Mechanical Engineering Industry Association) has provided guidelines with use cases for the practical application, from positioning in intralogistics to predictive maintenance. In these scenarios, the ERP system acts as a control center and data hub for subsequent processes.

  8. Compliance
    Compliance with the many laws and regulations will continue to challenge companies on an organizational rather than a technical level in 2021. The "ERP in der Praxis 2020/2021" survey by the Trovarit market analysts shows that more than 50% of the users classify compliance as very relevant in conjunction with their ERP system. The topics decision-makers are currently dealing with are varied: data access privileges, document archiving, evidence and documentation requirements along the supply chain, and many more. The traceability of serial and lot numbers is key here.

  9. Data management
    The more the companies implement their plans regarding Industrial Internet of Things and AI the more relevant the topic of data becomes. 58% of the companies interviewed for the PAC survey are convinced that they can improve their processes by continuously ensuring and increasing data quality. Another important aspect is the use of existing data. And here's a lot of room for improvement. A recent survey by Seagate has shown that 68% of the data collected in Germany are not used.

  10. High degree of user acceptance
    In 2021, many ERP users will put the usability of their systems to the test. According to Trovarit, this is the third most important topic of the upcoming year as 45% of the survey participants see an important trend here. Usability is reflected in various aspects. Flexible workflows can contribute to this just as well as masks that are easy to operate, for example, for plant data collection using mobile devices.
Besides these aspects, which all aim at functionality, ERP infrastructure topics will also be at the top of the IT agenda in 2021, particularly cloud and security. Which of these trends will be prioritized by a company depends on the economic impact of the pandemic as well as the respective industry and the company's specific situation.

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