Industry Perspectives on ERP Software

This post is reposted from the Sage ERP X3 Blog and is written by Guest Blogger: Matt Muldoon

Industry Perspective

ERP Software was originally designed to reduce the burden on IT departments within businesses by providing a single point solution for the capture, processing and reporting of business transactions. By creating a single point system, IT departments could spend less time managing and supporting complex and costly integrations between point solutions, and more time providing additional value to users in the areas of customizations, new reports and better performance. Of course a complete single point solution was never quite a reality.

Each business had unique requirements which were met through the use of specialist applications, or were met through customizing the software so heavily that it became “version locked” and was thus not upgradeable, meaning any new features or value added to the core application was lost. These Tier 1 applications are incredibly feature rich but are very difficult to change once implemented. Tier 2 ERP applications take the original concept of single point solution and combined it with a technology layer that allows the integration of specialist point solutions or the creation of customizations without recourse to base code and without creating a situation of “version lock”. This means that for the IT Manager, Tier 2 ERP Applications provide the platform and the processes necessary to run the business without major IT effort and the canvas to provide value add to the processes through powerful, embedded tools without increasing overhead.

Service Oriented Architecture

The key to Tier 2 ERP systems is the adoption of embedded flexible tailoring tools. This architecture changes the focus of ERP from transactions to processes. Processes made up of granular, identifiable objects that can be easily reconfigured to manage processes in different and unique ways. The modern ERP system provides a set of “Best Practices” for the end user, giving them a powerful and viable process set to base their application on. Within this framework, working with the IT Department, the individual company can overlay or insert it’s own unique steps, data elements, validations, forms etc. to make the generic process fit the specific needs of the business.

The tools provided can, in some cases, be used and managed by end users in instances where the changes are minor or handled through wizards within the toolsets. This relieves IT Managers from having to respond to the smaller changes and leaves them free to work with the users to provide the more complex and powerful changes, those with the greatest value to the company. Thus a Tier 2 ERP system helps the IT Manager fulfil both of the modern and often conflicting pressures of reducing IT costs while reducing the costs of the business through the use of IT.

In the next blog, in a few weeks read about the Standard user interfaces and how IT professionals use security and auditing tools.