What will change in ERP software in the future?

How digitization is changing ERP software

Freddy Czaja

The rapid technological development of the past 20 years has brought about a great change for many industries. Whole fields of business disappeared, others were created out of nowhere. The best example of this is the mobile phone, which was replaced almost overnight by the smartphone - which finally ushered in a new era. But even ERP vendors with their solutions were seized by new technologies and had to face great challenges. The internet takes on an outstanding position here with its cloud computing (cloud).

This article looks at the future of ERP software, the requirements of the next few years, and what companies should look for when choosing a new ERP.

Cloud & SaaS

Already in the early 1990s was prophesied by some personalities in the IT industry, "that the computer will be distributed on the network." And they were right! Today we find cloud solutions everywhere. We saving images or documents in Google Drive, uploading pictures and posts on Facebook (since 2004), or hosting a website on third-party servers. Softwares as a Service (SaaS) is the name of the business model. And especially small and medium-sized companies profit from it.

In the ERP area, this can reduce costs that are usually incurred by acquiring the hardware and software or by IT personnel. Further advantages are location-independent and collaborative work and the "low" rental costs. In summary: the number of companies they use cloud solutions will increase in the future. ERP vendors who ignore this "trend" will probably not have a future!

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Integrated CRM

One of the strengths of the enterprise resource planning system is that redundant data is avoided, because only one enterprise software (database) is used. The logical consequence would be that the CRM will be fully integraded in the ERP. But things get now complicated because today's market-leading CRM systems are so good that it's hard for companies to say goodbye to established softwares - and current ERP systems with integrated CRM solutions have not yet reached this class (with Exception of Odoo perhaps).

For ERP providers, this means that if you want to be at the cutting edge, you have to develop an equal CRM or, as described in the section below, create the possibility that CRM systems (by default) can be docked to the ERP.

Integration

Interfaces to other applications have always been a problem of (ERP) software. In future ERP versions, it must therefore be easier to connect suppliers and their software, web services or even machines and sensors with the ERP, for example. Conceivable here would be a flexible app architecture in which the core of the ERP software remains unaffected and only appropriate internal and external applications are docked. The goal is to synchronize all apps and data in real time, and make upgrading to higher versions easier.

In the future, it will be even more important to provide the whole thing in the standard. Here, of course, the ERP manufacturers are required and (then) all other software companies, the develop external apps and their interfaces program.

Digitization

The word digitization is on everyone's lips. But what does that mean for companies? In the ERP area, it means that as many processes as possible are mapped and controlled in ERP in order to save time and money. And that includes the storage of data. The digital archiving of documents saves shelf space, office material and above all time (of the employees). Future versions of ERP must enable all documents, such as contracts, invoices, receipts, delivery notes, etc., to be stored in the ERP (document management), PDFs filled out digitally and the electronic signature  becomes standard. For customers, this eliminates the hassle of downloading, filling, scanning and the subsequent upload.

Also the customizing ability is (also in the future) important for ERP system. This creates the opportunity to map all processes in the ERP and to react quickly to changes.

Mobile applicability

ERP manufacturers (and their customers) have realized that the mobile applicability of ERP systems will be very important in the future and therefore must be standard. The Internet with its millions of websites show it: the majority is available today in Responsive Web Design, so that customers can always expect an optimal presentation. For ERP manufacturers, it ultimately means that all ERP areas for mobile devices must be optimized, firstly, to support all business processes and, secondly, to make them available at any time.

For example, because many corporate employees need to work on the go, they need an ERP that supports and simplifies processes directly at the customer (for example: the maintenance of Maschinen and related electronic order issuance, calendar entry, documentation, and customer confirmation).

AI technologies

AI technologies (artificial intelligence) will be used in various ERP areas in the future. The main goals are constant learning, improvement of forecasts and decisions, workflows and processes. This includes completing routine tasks (which is usually done by staff) and recognizing complex relationships and, associated with that, better prediction.

Furthermore, AI technologies will help provide solutions to potential future problems. For example, in the creation of maintenance plans for machines and vehicles, in finding trends and behavioral patterns (customer behavior).

GDPR

GDPR has been on everyone's lips since May 2017. This is primarily about the protection of personal data and the security of data. Violations can be punished with heavy fines - which can also threaten the existence of a company. For this reason, all ERP systems must be suitable for GDPR in the future. This involves automatically deleting of personal data within certain deletion periods, pseudonymizing data, improving security standards (and authorization concepts) and monitoring access.

About Freddy Czaja

SEO is the air he breaths. If it has a bit of Oxygen, he doesn't care/ He likes his coffee black and cold.