Considering the breadth of features and capabilities, it’s easy to miss out on key benefits that your ERP system can provide. Today, we’re pulling back the curtain to help you make the most of your current ERP software.
Read on to learn ERP optimization tips that will boost the return on your investment.
What is ERP Optimization?
Before we go any further, let’s define what we mean by ERP optimization. In short, this is the process of analyzing your people, processes and technology to determine if anything is keeping you from unlocking your ERP system’s full potential. These could be known issues that you’re currently working through, or the analysis could unveil new challenges.
In addition to identifying root problems, ERP optimization also identifies corrective actions needed, along with potential cost savings.
The 2022 ERP Report
This annual report summarizes our independent research into organizations' selection and implementation decisions and their project results.
Why Should You Optimize Your ERP System?
Consider the consequences you could face if you don’t regularly assess your ERP system. Continuing on with the status quo could cause your system to become stagnant. It could even work against your organization, as it no longer reflects the true state of your operations.
You need an ERP solution that’s capable of keeping pace with your company’s speed of growth. It should be mapped to your current processes and robust enough to support long-term growth.
ERP optimization is the best way to ensure your ERP system and related processes continue to align with your business goals. After all, most of the benefits of ERP are business-related as opposed to technology related.
4 Tips for Successful ERP Optimization
1. Analyze the Root Causes of Business Problems
Are you experiencing issues with your current ERP setup? Are users expressing frustrations over the system’s usability, functionality or accessibility? Rather than trying to tackle all the problems at once, it helps to divide them into specific categories.
In most cases, ERP-related business problems can be traced back to five main issues:
- Improper ERP requirements gathering
- Lack of focus on business process management
- Lack of organizational change management
- Low executive buy-in
- Poor project management
Take the time to determine the root causes of your business problems by tracing them back to one of these five aspects. Until you know what’s really driving the problem, it can be impossible to assign the right corrective action.
One of the most effective ways of optimizing your ERP system is not through technology enhancements but through comprehensive organizational change management. The end-user adoption issues we’ve seen in our ERP project recovery engagements really highlights the importance of change management.
Change management goes beyond end-user training and communication. It should also include deliverables like organizational readiness assessments and change impact assessments.
2. Keep up with Upgrades
There’s a reason that software upgrades exist. These new versions are designed to fix former issues, enhance current capabilities and improve the overall performance of your ERP system.
Upgrades also can help you:
- Lower your total cost of ownership(TCO)
- Improve user productivity
- Comply with changing government regulations
- Keep up with technology advancements
We recommend talking to your ERP vendor about a comprehensive ERP service plan. This can help you stay in-the-know about important ERP upgrades, updates, service packs and more.
3. Document Changing Business Requirements
Your business requirements aren’t stationary, nor are they evergreen. As your organization grows, your operational needs will shift accordingly.
If you want your ERP system to meet your evolving business needs, it’s important to document any new business requirements. Business process management and business process reengineering are some of the most effective methods for gathering business requirements.
Not only will you gain an understanding of your current state, but you’ll have the opportunity to design your future state. This helps you build organizational capabilities through more efficient processes and the elimination of any non-value-added functions.
To learn more about business processes, check out our blog post, How do ERP Systems Streamline Business Processes?
4. Fulfill Those New Requirements
Once you know the new business requirements that you need your ERP system to support, it’s time to perform a technology assessment.
A qualified team of software consultants can help you analyze your existing systems to determine if they’re capable of meeting your current and future needs. These experts can help you identify technical configurations that can bring your system up to speed, along with third-party apps that can help fill in the gaps and provide increased functionality.
With an unbiased consultant by your side, you can see your requirements in a new light and approach them with a clearer and better-defined ERP design.
The Benefits of ERP Optimization
When you invest in a top-of-the-line ERP system, it pays to maintain it. ERP optimization can ensure that you’re always getting the most value out of your investment. It gives you the opportunity to realign your system to support your changing business goals, correct any issues and set the stage for continued growth.
Consider these steps as equally critical to your business as any new technology purchase. To learn more, schedule a free consultation below.