The secret benefits of ERP, revealed
ERP has come a long way. Discover how ERP with advanced technologies like cloud, AI and automation can help businesses be more agile, flexible, and productive.
I met with the CEO of a local nonprofit in Illinois who was frustrated with the agency’s current IT systems. The organization has a multi-million dollar annual budget and provides affordable housing and adult education programs. As with many nonprofits, it depends on the generosity of donors and grants from companies and the government. These organizations must be efficient with both their people and financial resources.
The CEO wanted to understand why he had separate systems for tracking donors, program operations, and grants. In his mind, these activities are all related. Donor engagement and grants are all based on the success of their programs. He saw the underlying data as a way of unlocking the full potential of his organization.
Ultimately, what he described – without using the term – was an intelligent ERP solution. When operations management can leverage program data, they can disperse resources in parts of the region in need of the most help.
Later that data can be enabled for targeted messages to donors based on a historic interests.
Additionally, the data feeds better grant applications, increasing the efficiency and reach of the programs. With their current systems, there’s no practical way to correlate the data and drive decisions based on it.
Making it real with a next-generation ERP solution
What does the world look like with an intelligent ERP? One example that I’m anonymizing to maintain customer privacy. We’ll call the customer “Acme” for this purpose.
What happens when you have a product at the top of its class in sales and effectiveness, but you can’t get the users to follow the instructions?
Acme had precisely this problem. However, it hadn’t always been the case. Early in the product lifecycle, the organization offered a premier service model. Whenever a new customer purchased the product, a company specialist would call and walk the new customer through the use of the product. The CRM data showed increased use of the system and extraordinarily strong customer retention rates.
Acme’s customer service couldn’t keep up with the product’s sales strength. As a result, both product usage and customer retention declined.
Not a challenge in the short-term, the decline in customer retention would impact the expected growth of product sales.
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Acme had a classic data problem. Just as our nonprofit CEO wanted to leverage data to direct limited resources, Acme wanted to leverage data to orchestrate its service.
The difference between the two organizations: Acme had invested in an intelligent ERP solution.
Leaders at Acme engaged data scientists to analyze data from the sales system with industry data to create a ranking system. The ranking system determined which customers were most likely to need top-notch customer support vs. which customers would respond to simple marketing reminders. The data scientist tweaked the algorithms based on response rates within the different customer personas.
Acme experienced a marked improvement in system use and continues its market-leading position.
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How do you get started?
If you’ve determined that your organization isn’t getting the results it needs with its current IT systems, one of first steps is to start by asking your existing ERP vendor some basic questions.
- How well do they know your industry?
- How have they helped other companies in your industry leverage data?
These are, of course, table stakes. Ask them the second-level questions. What are the technical hurdles as you start to leverage data to drive decisions?
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I’ll give you a hint. Older ERP solutions struggle with performance in answering these complex business queries. What seems like a simple question in the Acme example, “Who needs our help the most,” becomes a set of challenging technical issues:
- Where is the sales data?
- Where is the industry data?
- How do I get it in the same system to query securely?
- What system performance is needed to analyze the data?
- How do my data scientists and business users interface with the data?
- How do I refresh the system data?
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ERP solution: Problem solving, unleashed
The above questions are just a small sample of the asks when searching for an intelligent ERP solution. After implementation, the hard challenges start.
Without exception, I’ve discovered that after implementation of new ERP capabilities, end users begin asking more challenging questions. The hunger for data and the ability to process that data becomes limitless.
From a practical perspective, end users were never able to answer basic questions around their data. Once you implement an ERP capable of processing your existing data, you find out how far behind your organization has fallen.
Talk to other business leaders and technologists within your industry. Consider joining user groups for your target ERP solution and attend the virtual meetings. That’s where you’ll find a wealth of information around the ongoing demands of delivering on the promise of the intelligent ERP.
