There are a number of reasons why CIOs don’t realise the maximum benefit or ROI from their ERP systems. These often include reports that the software is difficult to use, only a small number of people in the organisation work with the system, that the implementation takes a lot longer than planned or is more costly than expected. However, one of the main challenges that CIOs face with enterprise software today, is the integration challenge. As the number of applications CIOs want to add to their existing ERP system increases, the integration between them becomes ever more complex.
A new Forrester report, It’s Time to Tame the ERP Integration Beast , offers an insight into both the technical and business challenges CIOs encounter when trying to integrate enterprise applications, but there are some key points to consider which will make the process easier and less time consuming for all involved.
* Firstly, can the ERP system or enterprise application easily integrate into the existing IT infrastructure that you already have?
It is important to make the distinction between a ‘technology vendor’ and an ‘application vendor’. A technology vendor will focus on developing enterprise applications that may improve the efficiency within your organisation or reduce the amount of time it takes to do a certain task, but they will require system integration, costing more time and money.
An ‘application vendor’ will focus on building an application that integrates easily with others and is supported by XML, web services, Java, Java EE and .NET technologies. You should consider a vendor that builds its applications so that all can benefit, not just those who can afford to purchase and integrate disparate applications and technologies.
* Is the vendor committed to using open standards?
As the Forrester analysts note in their report, most of the enterprise software vendors have spent the past few years ‘upgrading their application platforms and application architecture to enable much greater flexibility, using approaches such as SOA, BPM and event technology.’
Although SOA addresses many challenges related to developing agile business software, it suffers from some drawbacks. For example SOA applications generally have more redundant implementations, resulting in quality risks and more difficult maintenance. The many layers of indirection and comparatively low-level maturity of development tools mean that performance can suffer, both when using the systems and during development.
Therefore it is important to ensure that the vendor is committed to open standards. You don’t want to be restricted to only using their technology in the future and ‘locked-in’.
* How long is your new enterprise system or application going to last? Is it scalable? Can it support multiple sites and multiple currencies for example? If your business is to grow over the next few years, can the new system grow with the business?
Key considerations should include whether you can use the standard functionality in the system for non-critical processes and how much adjustment will be required for your organisation. Can these be done easily?
Again it is important to look at how the software has been built. Has the vendor taken the time to isolate architecture layers and platform components that might later become subject to change? If one area of the system needs refining, will it have a ripple effect to the rest of the system?
* Is the ERP system or enterprise application flexible enough to interface with not only desktops and the web, but also consumer-facing mobile apps, retail point-of-sale and real-time supply chains?
Many software companies make most of their profits after the sale by selling highly proprietary technology, making it cost-prohibitive for customers to switch systems or adopt new technology. It is important that your software vendor uses third-party standard solutions whenever possible. This reduces legacy and prevents the company from becoming burdened with over-whelming maintenance.
* How much will the system cost to maintain?
Before you purchase a new ERP system or enterprise application it is important to look at how much the maintenance costs will be? They will most certainly increase over the lifetime of the system and can vary. Is your organisation prepared to pay for these costs or can you find them cheaper elsewhere?
Also, you need to consider the quality of the customer service the vendor offers. If you have a problem, how easy will it be to speak to the relevant person to get it resolved? Will you be supported locally or will your query be sent overseas to someone who has little understanding of your implementation and organisation? It is usually easier to work with a company that both sells and implements its own software to get issues resolved rather than working through a third party.
The author is the managing director, IFS Australia and New Zealand.
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