It wouldn’t be far-fetched to call ERP (enterprise resource planning) the brain of an organization’s IT infrastructure. After all, an ERP system streamlines, standardizes, and integrates a wide range of vital business processes across diverse business functions.
Implementing an ERP solution ranks among the most capex-intensive projects any IT leader will undertake. In addition to substantial investments, the solution has the potential to impact all strategic business units of a company. It is, therefore, imperative for a CIO to follow best practices for deploying an ERP solution and then keep a close watch on the trends shaping it going forward.
Here’s a look at how the ERP category is evolving as an enterprise-wide solution and how these trends will impact IT leaders.
Customization gives way to standardization
The traditional practice of enterprise technology leaders customizing an ERP solution to meet their specific enterprise or business needs is giving way to implementing an off-the-shelf solution. A key driver for this is the steep resource cost in keeping customized implementations apace with the latest features — a cost many CIOs forgo in favor of stagnancy, at the risk of falling behind.
“There are regular updates to the ERP, which could be in the form of features and functionalities that are pushed into the live environment. If there is a high level of customization, a CIO will have to tweak the update in context of the customization. This is cumbersome and leads to additional cost. By going in for a standardized ERP solution, IT leaders can avoid these issues, and most are following suit,” says Abhishek Mundra, practice director for enterprise platform services at research firm Everest Group.
Implications for CIOs: Besides avoiding cost and complexity, deploying an off-the-shelf ERP solution also helps in accelerating time to market and making the business agile. “Earlier, because of the customization, the implementation lifecycle used to take…