Getting engagement from senior executives to build strategies collaboratively requires a leadership "flip" from CIOs, says Gartner analyst Jose A. Ruggero.
Start the journey by “shattering the legacy thinking” that surrounds most enterprises' understanding of ERP, Ruggero writes in the Gartner report CIOs Must Flip Their ERP Leadership to a Postmodern ERP Mindset.
“ERP is not a thing or a system, but a business application strategy that includes systems and processes, governance, funding, life cycle management and so on. A renovated fit-for-purpose ERP core is not only part of the digital core that enterprises need, but also mandatory for the digital economy.”
A renovated fit-for-purpose ERP core is not only part of the digital core that enterprises need, but also mandatory for the digital economy.
Ruggero is forthright the task will not be simple for CIOs and ERP leaders.
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“Dismantling the monolithic ERP core that has consumed much of IT's time and budget is difficult,” he writes. “Many enterprises cannot see how to make this change and are afraid to move away from their vendor-centric ERP inertia and dismantle the monolith in a more loosely coupled and federated way.”
He says the process can also be risky if not approached strategically as enterprises risk losing their large investments in business processes.
Another challenge is integration. “Deciding what, how and how much to integrate are not trivial decisions, especially when a lot of this integration came built-in,” he writes.
“A federated model also presents challenges in getting widespread engagement, buy-in and participation for agreement on what is core, what is common and what is discrete.”
Ruggero lists Gartner’s four axioms or principles of postmodern ERP that can help break the “legacy thinking” around ERP:
1. The demise of the ERP megasuite.
2. The challenge for established vendors who cannot build suites fast enough to keep up with the domain-specic specialists, particularly cloud specialists.
3. More and more new and loosely coupled ERP solutions emerging in the cloud.
4. Integration becoming more complex, with vendors hiding this complexity in the cloud.
He advises: “Use these axioms to communicate the challenges and the opportunities of postmodern ERP and demystify some of the misconceptions that may exist in the enterprise.”
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