As people fully dedicated to their business or career, we always try not to miss the right time for a change. In our article today we have presented 10 situations in which your ERP system has to be replaced with a new one, matching your current business needs.
1. The system has reached the end of its life.
The end of the system’s life or the end of its support, means that the software has reached the stage after which no improvements or updates are expected. This is the effect the usage of old technologies in the program’s basis. Due to these old technologies the system is no longer effectively working.
Even when the system has reached the end of its life, it will not automatically stop working. You will probably be informed that no updates or support is beeing provided. This will not affect your work instantly and so you will have enough time to find a new modern solution for your business. If you still decide to keep using the current program, have in mind that your problems will start increasing and becoming more serious. You may reach a stage in which the system completely crashes and a huge amount of information is lost.
Therefore, if you see that your IT system is near the end of its life you’d better start a research on the options for your company’s future.
2. Current ERP/CRM system is not in the Cloud
When choosing a new IT system it is almost necessary for it to be Cloud based. We are not saying that it is essential, because there are very few industries that require the opposite, but the chance to be one of them is very small.
The Cloud technology provides so many benefits, which if you do not use, your company becomes not as effective and competitive as you want it to be. Here comes the need for such a program, which gives you access to information from every device in every single moment .
3. Your software doesn’t have features, which are a standard for your industry
It is easy to fall in the trap of convenience of using the old system, which you and your workers are used to. But it doesn’t have the capacity and the features to extract the maximum for your business. You have to follow the new technologys and opportunities, which are offered to your company. At some point comes the moment when certain functions or structures of business processes become a standard of your industry, but you do not have them, because they are not support by the ERP. This is a clear sign that it is time to change.
4. Your business is growing
If your business is growing then a stage will come in which you will really need a new IT system. No matter how good you have predicted this growth, every system has it’s own limits and your current system limits are based on your starting point. Therefore if you have grown too much in the last 4-5-6-7 years, then it is expected that you have reached the maximum of its potential. It is time to think about a new solution that allows your business to continue to grow in the next years.
A good example for this is a small enterprise, which did not keep track of the system’s communication and its relations with current and potencial clients. This was not necessary, its small structure and good communication among employees just made it pointless for such information to be inserted.
With the growth and new people,staring work in the company, it gets exremely necessary for the entire information for given accounts to be easiely accessible and here comes the need for an integrated CRM module. Besides everything, it will make it easier and faster for new employees to get into their jobs, without them making fatal mistakes.
Another way is to have a CRM system that has not been integrated. This means the reiteration of entering this information has been made twice, which leads to less efficiency. In small volumes this was not crucial, but with the expansion of your business, it starts to take a lot of time. Time in which your employees, can think about how to sell more and not deal with bureaucracy and administration.
When your business grows it may need more resources and features. And if you have a system designed especially for you , then the improvements and upgrades cost a lot and only make the system slower. In a given stage it won’t be able to be efficently improved it and this tells you that you need a new system, which has a solid base which supports more efficently and easier all your business processes.
Your IT system must help your business grow and not limit it. If your initiatives and activities, which you are not taking care of,or you are not using their full potential, because of the software,then it is time to think about a new solution.
5. Different minor systems – ERP, CRM, BL, Accounting haven’t been integrated among themselfs.
Integrated ERM/ CRM system
It is necessary for you to insert twice a given information. If your system is more than 5 years old, then it is quite likely the different module/systems not to be integrated in one whole solution. And not only that they are not integrated together, but there are not even possabilites for an easy and comfortable way for them to be connected so you can evade this process.Besides the loss of time this also leads to mistakes. Therefore you don’t have the opportunity to automate given business processes, which are the connection between the separate modules of a single integrated IT system. This leads to additional losses of time and resorces.
6.Your current system does not help taking informed decisions
A software which supports planning and executing,helps you keep track and control over operations connected with all orders in a way that all goes smoothly. All of this is great , but such a software does not give you an easy access to where you are headed. For an example – you are a distribution company, doing your orders precisely and on time, but for that you have to manage stock availability right .
A good software will show you in every moment, where the underwater stones are – from which of your items you don’t need urgent delivery and for which you do. Also a smart ERP can manage your growth plan and predict the necessity of bigger instock positions. The benefits of these simple resolves can be many and make huge difference in long term.
If a given sales agent doesn’t succeed in establishing his plan, then he can easiely generate the information he needs so he can resolve key problems in which he is performing under expectations.
Basicly a good ERP system lets you have all the infromation arranged the way you want it to be. This gives you the opportunity to take informative decisions and to know in every moment the status of your company and where it is headed.
7.Doing things in a precise way , but not neccerary the right way
As we said the ERP system must help you grow and not to hold you back. A good sign that a change is necessary is when you find out that your employees adapt on the way they execute given processes to match the way the ERM system accepts them. It is ok if that was the way you have arranged your processes, but it may not mean that it is the most effective solution.
If your system is old and slow it’s less likely that the implementation of a process uses good practices in your industry and from there comes the need for change in order to reach higher efficiency levels.
8. People do activities outside the IT system
An important sign for the need to reconsider your IT infrastructure is if an employee deals with activities outside the program which are an inseparable part of it. In our daily routine in which we do just half of the work ( like generating one part of the report and then handing it over to another employee to finish) is well known ,right ? For such scenario the employees could also be responsible and the problem could be the lack of discipline, but most of the times this is not the case. Your system limits, confuses and does not give the opportunities, which your workers need. Here comes their decision to have information outside the system, which means less efficiency and decrease of the benefits of the software.
In long terms this “mess” of information doesn’t just lead to loss of time, but also to a significant financial loss due to mistakes. This is exactly, why we define this fact as one of the most important. It stands for even smaller companies, which have started with a single excel file and now have dozens. They also need an optimization and an ERP that allows them to grow.
9 .Strong dependence on one or two people from the team
The older ERP systems, especially the ones designed for special enterprises and those with very customized modules and features are often managed by one or two empoloyees. They know the system’s core and because it is a complicated and heavely structered, nobody from the rest of the team has any desire to learn about things, they do not actaully need on this stage.
This puts the business at a risk. It becomes highly dependant on these few people. Therefore we advise at reaching such a stage of the development, to start researchng the opportunities, for a new modern and more flexible system.
10. The communication happens outside the system
Nowadays is essential to be able to find the exact information fast. If the communication with your clients, potential clients and partners is happening outside the system then you have a lot of potencial for improvement. In short term the benefits do not look that much but when we talk about information gathered in years , then you automaticaly gain huge advantage, because in every moment you are aware of what is happening with a given person. This gives you good arguments to reach your goals.