THE COST OF DOING NOTHING: WHY YOU CAN'T AFFORD TO SIT ON AN ERP SOFTWARE DECISION
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The Cost of Doing Nothing: Why You Can’t Afford to Sit on an ERP Software Decision
As shown in Figure 1, the number one reason that many
organizations refrain from implementing ERP, is that they consider
themselves “too small.” While there is a stage, in the growth of an
organization, where they can operate without an ERP
implementation, that size is shrinking, as more ERP vendors
provide ERP functionality for smaller businesses.
But the most troubling reason that organizations do not
implement ERP, stems from the naive belief that these
organizations have been able to operate without ERP to date. As a
result, they believe they will be capable of running without ERP in
the future. These organizations either do not plan on growing in
the coming years, or they are unaware of how their current
technology environment is holding them back.
In fact, those organizations that have chosen not to implement an
ERP solution, report several challenges that they face, as a result
of their technology environment, as shown in Figure 2:
Figure 2: Challenges Stemming from Lack of ERP Software
Redundant data
35%
Business systems cannot interact with one another
33%
System cannot track business processes
28%
Difficult to share data outside of the organization
23%
Lack collaboration capabilities
23%
Inaccurate data
23%
0%
20%
Percentage of Respondents, n = 231
Source: Aberdeen Group, February 2017
www.aberdeen.com
40%
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The Cost of Doing Nothing: Why You Can’t Afford to Sit on an ERP Software Decision
Ultimately, these challenges derive from ineffective visibility. Less
robust applications are unable to provide information to decision
makers in real time, because of an inability to track processes and
redundancies. Therefore, business leaders are making decisions
that may not be properly informed, which can significantly harm a
growing organization.
Furthermore, obsolete technology has led to communication
challenges. Internally, everyone may be on the same page, but
inadequate systems can hinder communication with customers,
suppliers, and regulatory bodies.
On the other end of the spectrum, there are organizations that
already have an ERP solution, but are not achieving its full value.
These organizations decided to make the investment in emerging
technologies, to realize the benefits and advantages of a more
modern solution (Figure 3). Top performers look to their ERP
vendor as a partner that will help them with business innovation,
providing access - to industry best practices and technology - to
help them scale over time.
Figure 3: Reasons for Replacing ERP
Obsolete technology foundation or infrastructure of ERP
43%
system
Lack of features
41%
Cost of maintenance and support
27%
Inability to tailor ERP solution to integrate changes to the
22%
business
Lack of qualified resources to maintain and support current
system
12%
0%
20%
40%
60%
Percentage of Respondents, n = 231
Source: Aberdeen Group, February 2017
www.aberdeen.com
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