Reassessing the Comfort Zone of Your Homegrown ERP System
Why do you hesitate to consider a new software system for your distribution business?
There are several answers that immediately jump to mind: purchase cost, pain of transition, and short-term loss of efficiency in customer service. But each of these points can also be used to argue against remaining in the “comfort zone” of your current enterprise resource planning (ERP) system.
Maintenance costs are likely higher on your old homegrown system. Older machines require upkeep and upgrades to continue working properly at the maximum speeds available, and it becomes harder and harder to find support for the old operating system code and technology. But costs also appear in the form of maintaining a core group of knowledgeable employees who are the only ones at your company that fully understand your system. The time it requires to extract meaningful data for executive analysis out of your archaic database must also be included as a cost consideration.
The pain of remaining on your old system can be measured in many ways. There are business inefficiencies to overcome, work around or manually track, which are likely handled out-of-the-box by newer software programs. Gaps in your current software often lead to a patchwork of coded solutions that may address problems, but cause processing re-routes with multiple steps—again, less efficient than a newer program engineered to handle your business situations at its core. Your current system thus becomes larger in scope and harder to maintain.
There is also pain when training a new hire. Your old system may be familiar to your long-term employees, but it is quite foreign to a new generation of tech-savvy potential hires raised on Microsoft Windows and the Internet. The traditional character-based interface is not going to be familiar to anyone who went to high school or college in the 2000s. This leaves you to fill positions at your company with more mature employees whose cost to onboard is certainly more than that of recent graduates.
Maintaining a high level of customer service is critical to retaining long-term customers, as well as winning new customers for life. A new system, designed specifically to provide exceptional customer service, can win and retain loyalty from your customer base. By contrast, your old system, with inefficiencies that require multiple call-backs, delays, and apologies, is not as attractive to new customers shopping for suppliers, and as the quality of services offered wanes, so does long-term customer loyalty. Lack of rapid access to required information also may be causing you to overstaff your customer service department, bringing the argument back to cost.
Is a transition to a new ERP system painful? Absolutely, but think of it like a knee replacement. You can limp along and compensate for the problems you have, being consistently hindered by what does not work, or have the surgery, endure that time of discomfort, and then learn to run better than before.
When you argue against a potential system switch with costs, pain, and efficiency concerns, remember to consider them as they exist in your current system. Staying put is not going to grow your business, and in today’s market, maintaining the status quo is not enough to keep your customer base happy. A system that offers a return on the investment you make, and uses today’s technology for greater processing efficiencies and access to business critical information, will help your distributorship thrive.
Posted by Dave Lusk, Industry Segment Manager at Epicor Software Corporation