The End of an (ERP) Era

Last night one of our employees had the opportunity to be on the last flight of the American Airlines MD-80 aircraft. I’m not an aviation buff by any means, but anytime you hear about something being the last of anything it sparks certain emotions like nostalgia and even wistfulness. You start thinking about the “good ‘ol days” and “better times” … So that wandering of the mind got me to thinking about ERP (Enterprise Resource Planning) and business systems in general and where we are currently at in the “ERP era”.

I concluded that traditional systems are officially a thing of the past now. And whether software vendors or customers or consultants or anyone else who’s professional career revolves around business software likes it or not, traditional (legacy) ERP is on its last legs. That’s not to say that systems built on older technology won’t be around for a while, but the tide has turned from modern, cloud-based solutions being a fringe novelty to now being the norm.

Production for the MD-80 ended in 1999, but here it is 20 years later and it’s enjoying its farewell voyage. If you have invested in a legacy solution, it’s by no means the end of the world. You and your business will be able to leverage that solution for years to come. But if you are looking to update your systems or are shopping for your first ERP system, it just doesn’t make sense to go out and purchase one that was built 20 years ago that has a new paint job slapped on it.

I have always been a proponent of finding the right solution for your business regardless of what that solution looks like or what technology it’s built on. There are cases where having an on-premise solution makes the most sense and cases where having a SaaS (Software as a Service) solution makes the most sense. It’s all about context and need. But I saw a video the other day where an ERP expert called Cloud ERP the biggest hoax ever. And while there were some very valid points in the video, the elephant in the room remains that technology in general has shifted to a new platform, and that platform is the cloud.

There are a variety of flavors of cloud solutions. Consumer technology has been moving this direction for years and more recently so has business technology. One of the points in the video was that cloud ERP can’t be everything to everyone and that vendors have rushed unfinished products into the cloud and pushed selling them.

These are both true in specific circumstances. However, ERP no longer needs to be everything to everyone because there are targeted solutions that are good at doing specific things, and because of the technology they are built on can easily be integrated into other platforms. That’s the beauty of accessible systems. And vendors have raced to the cloud, but it’s because of the pressure from customers who are making purchasing decisions. When I worked for an ERP company, one of the questions we always got from existing customers was when were we going to have a cloud solution ready. It’s the market driving the technology, not the other way around.

There has been a slow transition in the ERP market from the old to the new and obviously some growing pains go along with that. But with the new technologies solidly in place, now is the time to evaluate your current systems and decide if you current legacy systems can continue to carry you or if it’s time to invest in something current and modern.