LinkedIn post 1
Quo Vadis ERP? What does the future of ERP look like?
Back in the 1990s, when the boom in ERP systems broke out, largely driven by SAP, most experts were convinced that ERP would be the dominant system in the company and that no other system would be needed in the future. The future of ERP seemed promising.
With the emergence of CRM and Salesforce in the 00s, this view began to take a hit. The increase in popularity of PLM, CPQ, APS and MOM systems that we are currently experiencing has intensified the pressure. 📊
Well, where does that come from? Where is the blind spot? 🧐
ERP was designed as a process machine in the company. You can find another blog post on this topic here: Interaction between ERP and PLM
A process machine that generates production orders and purchase orders from customer requirements and monitors their completion, quantities and value flow. For this to happen, the ERP needs timely master data! 📋
The real treasure of a company lies in its master data, namely its IP and the know-how of how its products and services are structured. Master data has a history and a lifecycle. It takes an enormous amount of effort for companies to create this data and keep it together so that it is consistent. Creating them has to be simple, cool, easy and intuitive. Every stand must be just a tap away from the user at all times. 🖱️💡
Well, and here lies the problem. Many ERP providers have forgotten about master data. They treat it as if it's just a necessary evil to keep the ERP running. This is now taking its toll as it creates space for other IT system classes and this is what we are seeing in the market. 📉
Now, what does this mean for ERP vendors? I think it will not be enough to simply provide fancy looking interfaces. It's time to look at the creation processes and the nature of the master data required in the future and deliver best-in-class functionalities so that it is not only used in ERP, but also continues to be created there. 🏆
How does that work? That is the exciting question. We at RIM have clear solutions to this. For all vendors who are interested, please get in touch with us. 📩
What do you think about the future of ERP?
LinkedIn post 2
Is ERP in a Dead End? What is the future of ERP?
How are buzzwords such as clean core, cloud, packaged business capabilities and low code changing our view of ERP?
ERP, once the dominant IT system class in companies, is coming under pressure.
Why?
If you want to understand ERP you can see it as a machine.
Input are customer orders or customer requirements, the ERP machine turns them into production and purchase orders. The quantities and value flows of the production and purchase orders are tracked and the costs are summarized and allocated.
Well, that was it. All the additional functional units that we find in ERP today don't need to be there. So what I have described is the actual core of the ERP system.
In order to fulfill its task, the ERP needs a network of master data that contains all the necessary business objects in their summaries (product structures and parts lists).
This network does not have to be created in the ERP! It only has to be available at the right time (Effectivity Based).
The current uncertainty and dynamics in the corporate environment make it clear that all master data is subject to a lifecycle. They are not static as previously assumed.
This in itself is nothing new, which is why many ERP systems, above all SAP, have developed strong functions and data models for lifecycle management.
There are still no universally valid data models in lifecycle management. As a result, a lot of customizing has taken place in this area.
Now we are at the heart of the problem. What does the future of ERP look like?
If you now look at the core, you can come to the conclusion that the master data does not have to be created in the ERP but in other systems!
As a result, vendors run the risk of losing the entire creation and lifecycle functionality for all master data (we're not just talking about product data here!!).
Clean core - If you want to get your customers ready for the cloud, reduce customizing and focus on a clean core, this simplifies the transition to the cloud.
For customers, however, the legitimate question now arises as to whether they should not rely on third-party providers who have years of experience in at least some areas of master data creation.
As you can see, the creation of master data, which makes up a large part of ERP implementations today, can be filtered out.
This creates room for CRM, CPQ and PLM providers who are already aggressively pushing into this gap. It also creates space for low code platforms and process engines.
It already feels like a dead end, doesn't it?
How would you react to this as an ERP vendor?
I'm looking forward to your comments and don't find it that easy myself 😉
One Response
Subject: 3D-supported parts list transformation - challenges and solutions
Dear Professor Fischer,
We are intensively involved in 3D-supported parts list transformation, in which we convert a technical structure into a production-oriented structure. On the engineering side, we manage our product data in a PDM system (Windchill), while on the production side, the ERP system is leading the way. On the system side, we publish our product data from the PDM system to several local ERP instances.
I have followed your comments on the topics of data flow, structure and variant management etc. with great interest. In contrast to your comments, we are increasingly seeing the limits of PDM systems in the management of production structures from a holistic perspective. The technical data transformation is not consistent and does not appear to be completely solvable by PDM and ERP manufacturers. A central problem here is the control of validities in the local ERP system compared to revision control in the PDM system. The central PDM system would also have to take into account/handle many local ERP characteristics.
In recent years, however, we have been able to develop a solution approach that makes it possible to use PDM and ERP systems in a largely standardized OOTB version. This approach includes:
- 3D-supported planning of the plant-specific parts list transformation.
- The generation of customer orders in an external configurator.
- Content repeatability of the configuration result in the local ERP.
- The usable provision of 3D worker instructions that can be used for specific workplaces.
I look forward to a further exchange and will be happy to answer any questions you may have.
Yours sincerely,