Ageing ERP – when old ERP is too old

In a previous blog post I talked about the fact that people hate change and that the sociology of change may not always be taken as seriously as it might be, but can cause workforce inertia.
Well, the same can be the case when it comes to changing the ERP system to a newer version or to something totally different.

So when is old ERP just too old?

Well that depends on your viewpoint. A few areas for consideration are:

  • Age and reliability of the hardware,
  • Support of the current software solution
  • Customisations; their number and complexity
  • Implementation times or the perceived implementation time

With the rapidity of technological advances it seems to hardly take any time at all for hardware to become “obsolete” or at least superseded by something that is smaller, faster and better able to do the job. While it is not practical for businesses to change their hardware on a very frequent basis, there does come a time when their system that was perhaps somewhat state of the art and sought after at the time of purchase, just is not able to keep up.
Software developers do not generally write new software for old technology and hardware manufacturers cease support or don’t manufacture spares anymore. When this point is reached it may be time to go for something new.

Software suppliers will generally commit to support software versions for what they deem at the time of release a reasonable length of time. They may think that nobody will want to use it longer than five years, but often companies will run their ERP systems for longer than that, especially where they have extended the software with a number of bespoke enhancements. There will come a time when support is not available from the software vendor, at which point independent consultants would need to be found to provide support as needed.

Extensive customisations can deter businesses from moving from an older system that they are comfortable with, as they may feel that they have not achieved an appropriate return on the investment in time and money to implement and stabilise the customisations. It may also be the case that there is not a software solution that does what their current old system does, so the benefits of change are not so obvious. Implementing a new software solution is time consuming and can be unsettling for the business and its efficiency within its market. Implementation times have seen an overall reduction over the last few years as technological and software advances have come together to bring a huge improvement to “out of the box” functionality, that is easier to drop in to businesses because due to a greater focus on solutions being configurable.

There comes a time with any software solution where the cost to keep it running outweighs the benefits that it brings, and at that point it is probably time to replace it with a newer version or something completely new. Where the solution fails to keep pace with new ways, or working, or when it will cost a disproportionate amount to further enhance it to meet new challenges, it will quite likely be cheaper in the short to medium term to upgrade to new hardware and software and take advantage of current technologies.

Microsoft_Partner_logo_2016_800x397As a solution provider and a Gold Microsoft Partner, KPMG Crimsonwing can support organisations in such transitions process and that our solutions are easy to update and upgrade and that our consultants always look to offer solutions that fits the current requirements of a company but also foresee future needs.