Is it Time to Replace Your Manufacturing Company’s Existing ERP System?

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Enterprise resource planning (ERP) software keeps manufacturers competitive and positions them as leaders in the industry by providing a vital informational backbone.

An ERP solution is an automated system that manages daily challenges related to product and demand planning, tracks inventory and project management, and integrates design innovations while managing finance and accounting, customer relationship management, human resources and much more. Collectively, an ERP software solution enables flawless integration through all the varied areas found in manufacturing.

It is important to periodically analyze ERP software in manufacturing companies and to evaluate and recognize when it is time to replace existing ERP software. Your manufacturing company’s ERP software solution should always offer functionality and have the support from a partner that understands your company, industry and needs.

3 Reasons for Keeping an ERP System

System still has functionality and flexibility 

The current ERP system has functionality and flexibility that does not limit your manufacturing company’s growth.

Your current software is reliable

Your company’s ERP system is reliable, does not break down, and does not become unavailable due to hardware or software failures. It is important to have an ERP system that is always accessible.

The ERP system is still affordable

As ERP systems get older, maintenance costs may increase. It is necessary that the maintenance cost is not excessive or becomes too costly to repair unsupported software or discontinued equipment.

3 Reasons for an ERP Replacement

System is not functional or flexible

An ERP system that lacks functionality or flexibility will only limit a manufacturer’s growth. Examples of ERP systems lacking functionality occur when a manufacturer has acquired another company introduced new products or expanded its manufacturing and distribution chain. Likewise, manufacturers that do not stay on top of technology advances and industry standards with outdated ERP are not industry leaders. Government regulation and industry standards affect manufacturers. ERP software must keep up with standards before becoming a subject of scrutiny. All things considered, a legacy system in a manufacturing company will become more problematic if it does not satisfy the needs to handle basic day-to-day operations.

The current software has slow response time

This is also known as having a fragmented system. Current ERP software with slow response time affects productivity and creates frustration when accessing much-needed information or real-time data. Slow response time can lead to data redundancy, difficulty to create reports and neglect to combine operational and financial data. Reporting limitations is a sign that your current ERP system needs to be replaced.

Hardware and software is unreliable and expensive

When hardware and software are discontinued, or becomes increasingly expensive, it limits business activities and technological support. ERP software that becomes too expensive to maintain directly results in system shortcomings. There is no way to put a band-aid on an old legacy system with the hope it will continue to work effectively.

If your manufacturing company has stopped upgrades or opted out of annual assistance due to cost, it is a clear sign you’re legacy software is not practical for your business.

This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. In addition, this publication may contain certain content generated by an artificial intelligence (AI) language model. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.


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