Designed to help accelerate and simplify digital transformation efforts, it’s an exciting premise. However, is it the right move for your company? Today, we’re breaking down everything you need to know as you begin ERP selection.
The 2024 Top 10 ERP Systems Report
What vendors are considering for your ERP implementation? This list is a helpful starting point.
What is Low-Code ERP?
Traditionally, software development and implementation have fallen on the shoulders of IT experts who are well-versed and experienced in this space.
While this is an efficient approach, it can overwhelm and overburden these experts. This is especially the case when their plates are already full with their day-to-day responsibilities.
What can a business do when it needs new software, but there’s no one around with the skills or time to configure it?
Enter, low-code/no-code (LCNC) tools. These are functions that empower even non-technical people to design and build applications.
While the conventional approach can be time-consuming and laborious, LCNC tools are meant to be easy to use and quick to deploy.
The Difference Between Low-Code and No-Code
Though they’re grouped together in a single acronym, low-code tools are different from tools that require no code at all.
As they do require a small amount of coding, low-code solutions demand a degree of development experience (but not enough to make them inaccessible to non-IT users). At the same time, skilled developers can also use these tools to expedite application building projects.
Low-code programming simplifies the integration process when it comes to elements such as:
- Databases
- Application programming interfaces (APIs)
- Web services
While using low-code solutions is a breeze, using no-code solutions is even easier. Most of these programs have simple drag-and-drop mechanisms that allow users to configure applications visually, without any amount of back-end coding.
Benefits of LCNC Tools
The global LCNC development market is projected to total $187 billion by 2030. That’s up from just $10.3 billion in 2019.
Much of this growth can be attributed to the COVID-19 pandemic, which has shifted the responsibility for application development from IT experts to business experts. In fact, in 2021, more than 40% of employees who customized or built data solutions did so outside of IT.
Moving forward, analysts predict this trend will continue. By the end of 2025, it’s expected that more than half of all LCNC clients will be non-technical users.
In many ways, it’s easy to see why. LCNC solutions allow businesses to:
- Empower business-side employees with problem-solving resources
- Boost application productivity
- Quicken time-to-value
- Improve customer satisfaction
- Lower the overall cost of application development
- Spur new opportunities for app development
Whether business leaders use these programs to create brand-new applications or configure existing ones, these tools can deliver significant value. Yet, are they viable solutions for more complex projects, like ERP and CRM implementations?
The Role of LCNC in ERP Implementations
Most ERP implementations are both complex and costly. This is especially the case when extensive customizations are required.
While this level of customization isn’t typically necessary, a certain amount of customization or configuration is mandatory. This is because out-of-the-box solutions are inadequate for keeping pace with the competition and innovating on a greater scale.
As a result, companies are looking to LCNC options to accelerate the customization and configuration process. These tools shorten the overall development cycle, which can seem never-ending in a sea of ongoing changes.
The Cycle of ERP Changes and Customizations
When an organization adds intellectual property to their ERP system, they’ve initiated a chain reaction. Next, they’ll have to write the code for the change. Then, they must implement the change and update their workflows and reports.
Amid the changes, it’s easy to miss critical upgrade cycles that keep the ERP system running at peak capacity. Sensing this pain point, many ERP vendors have included LCNC functionality in their latest platforms. In fact, many of the systems in our 2022 Top 10 ERP Systems Report include low-code/no-code capabilities.
In general, vendors are making the switch to more flexible frameworks that are easier for beginners to use and understand. These frameworks include intuitive tools and components that work as another layer of the ERP software. Some of the functions organizations can perform with this layer include:
- Adding ERP customizations without special developer skills
- Personalizing a feature to a specific role or group
- Tailoring interfaces for easier data entry
- Creating integrations for additional third-party services
- Centrally managing and viewing all customizations
A designated individual within the organization should be able to use LCNC tools to perform minor customizations. Still, extra training is usually required before they can tackle major customizations.
Risks to Consider
Though they’re making waves in the development realm, LCNC tools aren’t a guaranteed home run for all organizations. One of the biggest stumbling blocks? Usability.
While they’re designed to be as intuitive as possible, many employees still find these tools complicated to use. In such cases, we recommend conducting extensive user training before users are allowed to take the reins.
Another risk is system security. When users begin making changes to the ERP setup, it’s important to have project controls in place to make sure systems remain secure.
Should You Pursue Low-Code ERP?
If you anticipate making a slew of changes or customizations to your future ERP solution, then it’s worth considering low-code ERP solutions. These solutions have a flexible customization layer that allows you to make changes without extensive IT oversight.
While this has many benefits, it’s not without risks. It’s important to make sure anyone trusted with these tools knows how to use them. Training is key, and project governance is crucial. Only then can LCNC tools live up to their hype.
Looking for more information on how these systems work? Contact our ERP selection consultants below for a free consultation.
