If we implement an ERP System poorly, the consequences can be devastating. The estimated costs for the project would multiply. So, how do you know if it is time to change your ERP system? This will help you avoid wasting more time.
In some cases, companies realize too late that the ERP System they chose is not the right one. In that case, they must repeat the process, which leads to wasted time, effort, resources, among others. This ends up seriously affecting the initially calculated budget.
ERP Systems can affect the entire organization transversally, especially people, processes, and the product. This means that, if a significant error occurs, the company may suffer a shutdown. Due to its inability to work, it may possibly have to resort to manual methods.
In 2004, HP recorded a 5% drop in profits due to delays, cost overruns, and lost revenue during the implementation of a centralized ERP System for the entire organization.
The problem in Vodafone’s case occurred when several of its customers were not migrated to the new platform, and failures began to occur in billing and service suspensions for several customers.
Vodafone did not declare these problems in its ERP System, so when everything was revealed, it had to pay a fine of 4.6 million pounds sterling.
What are the most common problems in an ERP System?
Below, we present the most common problems that have appeared in ERP Systems, with the goal of performing a self-assessment and knowing whether it is time to make immediate changes before facing serious problems in your organization:
The vendor does not offer support
Choose your provider carefully. Make sure they offer quality software. And not only that. Over time, it will be very useful if your vendor offers advisory services and has experience implementing ERP Systems.
In the end, they should be with you throughout the entire implementation process, so you should make sure of their level of professionalism and commitment to clients.
Your current system does not provide constant updates
Your ERP System cannot be static; it must be updated to continue solving your business needs. It must also allow you to stay current with tax regulations to avoid inconveniences with authorities, customers, and suppliers.
It helps you stay at the forefront within the industry in which your company competes. It also supports the streamlining of your business processes, increasing company efficiency.
Your current system is not suitable for integration
Over time, the importance of having reliable information to achieve strategic objectives has increased.
Thanks to this, it is now very important for companies to keep all their departments connected. The sources involved must have the necessary means to share useful and reliable information in order to meet their objectives.
To achieve this, system integration is no longer considered an option, but an obligation. It is not only about connecting systems: integration in an ERP System means aligning the Information Technology strategy with business objectives.
Slow system with frequent errors
“My ERP system is working worse and worse, it is slow, ineffective, and not very functional”… reflections like these are indicators of a reality. Your management software no longer works properly.
The need to change ERP Systems is a subjective topic. The client will try to deny this need by arguing that they have not yet finished paying for the previous ERP. On the other hand, the provider’s reality will be the opposite.
However, both parties agree that working with an obsolete ERP can have truly negative effects on company performance and productivity.
A system that is too complicated and users do not feel comfortable with
Most ERP System users are unaware of a large part of this tool’s features. Only 46% of users had adequate knowledge of their own ERP’s features.
Training programs are therefore essential to ensure ERP success in your organization. In addition, it would be important to frequently monitor the use of features to confirm that the software is being used to its maximum potential.
A system that is too small compared to your company
For this, you should receive the best advice regarding the ERP System suitable for your company. Otherwise, you may purchase a system that is not ideal for your needs, wasting time on staff training and money.
Remember that part of the success in updating and maintaining your ERP System depends largely on choosing the right consultant or provider. If this is not the case, you can still change. At Inventiva, we offer our ERP consulting service.
If you want to learn more about our different modules for companies, you can click here to download the catalog for free.
On the other hand, if you already know your company and its needs, you can speak directly with a consultant who will help you throughout all processes.
