About the blog series
The renewal of ERP (Enterprise Resource Planning) systems is a critical for many companies aiming to optimize their business processes and meet modern technological demands. BearingPoint regularly conducts systematic market research on ERP systems, identifying and analysing the current situation, changes, and trends. This study was conducted through interviews with employees in managerial positions at industrial companies in Finland.
In this blog series, we present the findings from interviews, which are divided into four key categories: Technology, Key considerations, Implementation Projects, and Change Management. This blog post examines the features of an ERP implementation project. The results of the interviews examine integrator selection, external support usage, changes in business models and operations, as well as key challenges.
Choosing an Integrator & Using External Support
The findings from the interviews indicate that 67% of respondents have not yet selected an integrator for their renewal project, while 33% have already made their choice. The most significant factors influencing the selection of an integrator include the technical expertise, industry and business knowledge of the key personnel involved in the project, as well as the cost. Additionally, general and local ERP implementation experience, recommendations, tools and methodologies, and the ability to work in a specific language or location are important considerations.
The interviews suggest that companies highly value in-depth technical knowledge and industry-specific understanding, which can significantly contribute to the success of the project. Furthermore, companies appreciate integrators with extensive experience who can provide customized solutions tailored to local needs. Testimonials and past experiences are also important, as they offer confidence and certainty in the selection process.
67% of respondents plan to use external support for process and solution conceptualization and design, change management and training, data migration, and system support. The next largest areas for external support include testing management and implementation, program and project management, and post-go-live user support. This underscores the importance of these areas and the need for expert assistance to ensure project success. It demonstrates that companies recognize the criticality of these steps and want to ensure they are handled professionally. The least amount of external support is anticipated for quality assurance and cutover management. This may indicate that companies feel they have sufficient internal resources and expertise to manage these tasks or that they do not perceive these areas as challenging as others.
Changes in Business Model & Operations
Changes in the business model or operations related to the ERP renewal project include the increasing adoption of automation technologies (RPA, AI, ML) and the associated organizational rationalization. The transformation of the value chain, the harmonization of operational models across organizations, and the enablement of new future capabilities are also significant. This indicates that companies are seeking unity and synergy between different functions, which can enhance collaboration and reduce duplication, leading to improved overall efficiency. Enabling new future capabilities is crucial as it prepares companies for future challenges and opportunities, demonstrating that companies are not only addressing current needs but also strategically planning for the future. All companies already have a plan in place, underscoring the importance of planning and anticipation in ERP renewal projects. This ensures that changes are implemented in a controlled and goal-oriented manner.
Key Challenges
Key challenges in the implementation of an ERP strategy include insufficient business resource capacity and ERP transformation expertise, as well as poorly documented and standardized processes. Additionally, insufficient IT resource capacity, a complex or fragmented ERP landscape, and business and IT compatibility are significant challenges. The companies that participated in the study did not report challenges related to current or weak ERP strategy and plan, financing, or budgeting.
The results indicate that most difficult aspects of the ERP renewal program and implementation are the presentation and implementation of new operating models, as well as data migration and data quality. Resourcing suitable capabilities, managing the program (costs, budget, schedule), and managing the scope during implementation are also challenging. The least challenges were experienced in designing new processes with an integrator and testing the solution before go-live. Management support and project ownership were not considered challenging.
Conclusion
Although most respondents have not yet chosen an integrator, the factors influencing the choice emphasize technical expertise, industry knowledge, and cost-effectiveness. External support is a critical component of ERP renewal, particularly in key phases such as data migration and training. Automation and value chain transformation are primary goals in ERP reforms, reflecting companies’ efforts to streamline operations and adapt to new business models. The key challenges are related to insufficient resources and the standardization of processes, highlighting the need for careful planning and adequate resourcing in the implementation of the ERP strategy. The implementation of new operating models and data migration are the most challenging aspects of an ERP reform, necessitating special attention and sufficient resources and expertise.