Over the last forty years, Enterprise Resource Planning (ERP) software has become an integral part of the operation of manufacturing and distribution businesses. The main goal of an ERP system is to increase a business’s efficiency by allowing businesses to intelligently collect, manage and sift through data for a variety of activities. However, as ERP systems get older and are no longer being updated, they can begin to negatively impact the businesses that use them. These “legacy systems” are often in need of replacement, but instead of replacing them, business owners spend significant amounts of time and money trying to make these systems work instead of finding a new solution.
Here are some tell-tale signs that your legacy system is hurting your business, and that it is time for a replacement ERP system:
- Costs are piling up: Using a legacy system can be like trying to fit a round peg into a square hole. Many of these ERP solutions were made to run on an old OS, and have not been updated for new operating systems. For example, if you are trying to run your ERP solution that was made when Windows 95 was running on your business' computers, then it is going to be difficult to maintain if the software has not been updated for the latest OS. Costs can pile up quickly for a company that is no longer receiving support from the vendor for its ERP software. Typically, they use a third party to keep the software up and running.
- Limited features and functionality: Your ERP provider should be updating its software often, providing you with the latest features and increased functionality. If your legacy system is not being updated, you are likely missing out on improvements that your competitors are using. An inflexible ERP system makes for an inflexible business.
- If you are not utilizing modern techniques to transact business such as electronic invoices, ACH payments, PDFs, and laser documents your customers will notice. It will become apparent that you are not investing in your business and may go with a more progressive competitor.
- No support: Often, support is no longer available for legacy ERP systems. Whether the company that produced the ERP system is out of business or no longer providing service for an older solution, a lack of support can leave your company in a bind. It is always easier to deal with questions and issues when you have a dedicated team of experts to contact.
- Difficulty accessing information: Legacy systems may contain a ton of information that is difficult or time-consuming to access. You should be able to perform virtually every task concerning your business from your ERP solution with relative ease. Outdated software and hardware used to track and maintain information collected by your company can prevent you and your team from finding the information you need. If you are having difficulty accessing information about your business and your customers then it is time to begin exploring other options for an ERP solution.
A company’s ERP system is a major part of its business, one that is relied upon daily. The vital nature of an ERP system causes some companies to hesitate to make any changes. However, at some point, a legacy ERP system may be doing more harm to your company than good. If you see any of the signs noted above or feel as if you should be getting more out of your ERP solution, consider replacing your legacy solution with software that is built for today’s business environment and is focused on the future.