ERP systems have remained in the doldrums for several years – to some extent a victim of their own success. ERP systems have been particularly successful in driving down average transaction costs through standardization, breadth of applications and of course a high level of integration. So if you have comprehensive functionality and the underlying technical platform is more or less static then there is little incentive to change course. But external factors are beginning to weigh heavily on ERP systems. In the face of constant changes in regulation, more sophisticated information needs, e-commerce and the networked economy more generally some organizations are finding their systems inflexible and too costly to change. But most organizations cannot simply justify throwing away their systems and starting again, so suppliers have to devise architectures that allow a gradual and selective, migration path so that organizations can ‘cherry pick’ the bits of new functionality that they want. Oracle and Infor have strategies that support this kind of incremental approach. Others such as Agresso (UNIT4) say that their original architecture is adaptable enough to cope with any change. So an interesting debate is emerging about the future direction of ERP systems. FSN’s Lesley Meall writes this week about companies that have taken the plunge.
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