What Will ERP Systems Look Like by 2014?

Enterprise resource planning, or ERP, systems are critical to the business operations of many companies, despite their reputation for failed deployments. It gives insightful views into a company’s operations allowing employees to make better and faster business decisions. Many ERP systems are deeply entrenched in organizations. Yet, ERP is in a state of flux.

The ERP of the future promises to be simplified, more accessible and easier to use, shaped by trends that began taking hold this year. What’s next for ERP is the beginnings of major trends — cloud computing, mobility and analytics.

First, ERP must become more simplified, both in terms of the deployment of the system and aligning it with an organization’s business processes.

  • Cloud computing enables companies to access ERP software over the Internet.
  • ERP can be more easily installed and rapidly consumed. The market is becoming less tolerant of these big, expensive, monolithic implementations of traditional ERP.
  • User Interfaces (UIs) will become more finely grained and tailored to user roles and user groups, from the workers on the factory floor to front-line employees to executives in the C-suite.
  • UIs will evolve rapidly to improve the ways users input, process and retrieve data.
  • Data input, in particular, will become simplified through the use of sensors placed throughout the enterprise that automatically collect different kinds of data.
  • Another way the user experience may improve is through voice recognition for search features.
  • Cloud-based ERP services will also become more integrated both with other clouds and with installed ERP systems.
  • Interoperability between cloud services will eliminate the need for companies to install middleware and programming to make third-party modules work with existing ERP systems.
  • More companies will consume ERP services through the cloud on an as-needed basis.

Second, vendors will continue to produce more advanced analytics tools that will help companies have better, faster access to the increasingly vast amounts of data that ERP systems collect.

  • Analytics will be further influenced by big data, which are data sets that have grown too large for commonly used software tools to capture, manage and process expediently.
  • For instance, SAP recently released a big data engine called HANA, which combines in-memory analytics with high-performance processing.
  • Predictive analytics, such as recommendation engines, will also be important to the future of ERP, enabled by faster analytics which leads to better business decisions made faster.
  • Reports that now take more than a day to process will be completed in a matter of minutes;
  • Advanced analytics can lead to more accurate decisions based on near real-time information, such as how many units need to be manufactured or how much inventory needs to be replenished.

Another global trend will also impact the evolution of ERP: sustainability. The greening of ERP can happen in two ways.

  1. Companies can use their ERP system to track data relating to its ecological impact.
  2. Companies can use virtualization techniques to make ERP a greener technology to run.

An ERP module designed to track and measure an organization’s total carbon footprint can replace a dedicated sustainability system. With virtualization, a company can consolidate ERP applications on fewer servers, which makes for a more energy efficient ERP system. Moving ERP to the cloud makes for greener ERP for the same reason.

Eventually, these trends boil down to the same goal — making ERP data easier to use and more valuable to the company. In the end, ERP is all about measuring data and using that data to make better, faster decisions.