Enterprise Resource Planning (ERP)
THE SUNDAY BUSINESS POST MAY 13 2012.
The ERP industry is in a state of flux, according to David Lynch, with top-tier vendors such as SAP responding to emerging technology trends and shifting market requirements. As ERP practice manager at BearingPoint, he is seeing a move to increasingly accessible applications that are appropriate to more Irish businesses. [: David Lynch, ERP practice manager at BearingPoint: ‘Payback is about harmonising and standardising processes, driving shared services’]
‘‘SAP has been working hard to make ERP affordable and relevant to mid-market companies at the same time as the number of large enterprises implementing full-blown ERP systems has got smaller,’’ he said.
Meeting this market requirement is Business All-in-One, a pre-packaged version of SAP’s main business suite, and Business ByDesign, a cloud-based software-as-a-service solution. ‘‘Both offerings are relevant for fast growing companies,’’ said Lynch. ‘‘They can be confident they are covered in terms of multiple GAAP [Generally Accepted Accounting Principles] reporting and dealing in multiple currencies and foreign languages.’’
David Lynch, ERP practice manager at BearingPoint:
‘Payback is about harmonising and standardising processes, driving shared services’
Both applications will also make sense to businesses that are willing to commit to changing their processes.
‘‘They will remove complexity and gain from the process. The fact is, very few companies have evolved fantastic processes so best practice is nearly always an improvement,’’ he said.
The general rule of thumb, according to Lynch, is that if a process doesn’t differentiate it should be standardised. ‘‘With these solutions, the starting point is to adopt best practice processes that are in use throughout the client’s industry.’’
BearingPoint believes these SAP applications will prove popular in Ireland, which is largely an SME market. ‘‘The business case has changed,’’ said Lynch. ‘‘Payback is no longer about automation. It’s more about harmonising and standardising processes, driving shared services.’’
SAP All-in-One has more than 20 sector specific templates with standard processes for different industries. The degree of fit will vary from company to company, but if 60-70 per cent of a template is relevant to a business then it justifies the investment. There is still project work to be done and configurations to set up, but the templates significantly accelerate implementation and drive down costs.
BearingPoint is also bringing Business ByDesign to Ireland, SAP’s ERP SaaS solution, built from the ground up to meet the growing demand for cloud services. The target market is similar to All-in-One but the different delivery model and standardised functionality will appeal to some businesses more than others. ‘‘Business ByDesign is highly configurable, but you can’t change the core application. With All-in-One you can do some customisation,’’ said Lynch.
Right now, it’s a good fit for SME firms but BearingPoint expects it to gain traction in the enterprise space as it becomes more powerful and feature-rich. The firm also sees an opportunity among multinational subsidiaries as part of a general trend in ERP. This is the so-called ‘‘hub and spoke’’ model.
‘‘A two-tier ERP strategy seeks to mitigate some of the issues that have been experienced with single instance ERP strategies. A tier-one solution, such as SAP Business Suite, is implemented for larger subsidiaries and a smaller solution is implemented for smaller subsidiaries,’’ said Lynch.
‘‘Business ByDesign is becoming a regular complement to SAP Business Suite for smaller subsidiaries, because it is easy to implement, flexible, modern and offers pre-built integration with the Business Suite Solution.’’
Organisations involved in acquisition will also find Business ByDesign a quick way of ‘‘on-boarding’’ a new business. ‘‘They might ultimately bring them into the central ERP system, but it provides a stop gap and an immediate way to integrate them into the business.’’
Running ERP as a SaaS solution delivers other benefits associated with the cloud. According to Lynch it allows companies to concentrate on their core competencies rather than expending time and resources managing complex IT systems.
‘‘You don’t need any in house IT resources, yet at the same time it improves your IT capability. The service automatically lets you have the latest technology at your fingertips with the upgrades and maintenance all taken care of by SAP,’’ said Lynch.
Both new solutions also tick boxes around emerging technologies that are transforming the way organisations go about their business. They include a full suite of mobile applications, facilitating anytime anywhere access to the ERP system. ‘‘The widespread use of mobile devices is one of the most dramatic changes in the technology landscape in recent years. You can’t just deploy your webpage on a mobile device, you have to understand and play to the strengths of the mobile platform,’’ said Lynch.
Also bundled with the applications are a new generation of dashboard-based reporting tools that are intuitive to use. ‘‘Many organisations survive on the basic operational reports they get with a traditional ERP system, but SAP is taking it further. Both of the new products add sophisticated dashboards and in-memory y analytics,’’ said Lynch. ‘‘It allows companies to process and analyse huge volumes of data in a way that was impossible before.’’
In-memory computing, cloud delivery and mobile applications are central to the SAP vision going forward. As a SAP partner, BearingPoint offers different levels of service around the new products and functionality, from strategy consulting and advisory services to full implementation and support.
The timing of these new products is good for the Irish economy, according to Lynch. ‘‘Not only does it future-proof businesses, it helps ambitious and fast growing companies that have an eye on export markets and overseas development.’’
BearingPoint is seeing consistent demand for its services from export-driven firms. ‘‘Selecting the right ERP solution is critical if they want to sell their products and services abroad and potentially locate in multiple countries in the future,’’ said Lynch. ‘‘These applications will give them the confidence to go into new markets without fear of constraining their businesses.’’