ERP systems have a scary reputation. Over the years many enterprises have initiated massive ERP implementations and upgrades, only to find themselves behind schedule, way over-budget and only using portions of the ERP functionality. Some of these initiatives have been abandoned mid-project or even ended in litigation. As a result, CIOs must carefully evaluate requests to make major changes to functioning, albeit woefully outdated, ERP systems.
Intelligent ERP (i-ERP) applications are ERP applications or suites that use machine learning and advanced analytics with curated data sets to manage resources and business processes. They feature an assistive and conversational user experience, and automate a set of high-volume repeatable tasks and augment (via human-machine interaction) the performance of less frequent, more novel tasks. Intelligent systems and applications are capable of processing, analyzing, and acting on massive volumes of data in real time, using in-memory computing (IMC) technologies.
Why Intelligent ERP?
Businesses want i-ERP for three reasons:
- Optimize resources across people, processes and technology to remove complexity, bring efficiency, and increase revenue, cash flow and profitability.
- Reduce operating costs by simplifying routine tasks; eliminating human errors; automating basic business processes; and removing additional drill downs, data extraction and analysis.
- Facilitate real time analysis and decision-making, leveraging advanced reporting to analyze unstructured data and structured related data.
Brace yourself for bi-modal sourcing
As new i-ERP applications become available, innovative line-of-business (LOB) leaders identify layers of legacy ERP functionality that are no longer serving the enterprise, and, source replacements. At the same time, IT organizations saddled with maintaining legacy ERP instances are consolidating and upgrading them — at great expense to the enterprise. Ultimately, the enterprise is divided into two silos.
IDC predicts that over 70% of such siloed digital transformation initiatives will ultimately fail; because of insufficient collaboration, integration, sourcing, or project management.
Sourcing in Three Dimensions
Mature organizations think strategically to identify the advances in ERP and associated functional technology that best align with the line of business requirements. They embrace innovation by identifying digital transformation drivers and owners, integrate vendor sourcing and management (VSM) executives into their teams and incorporate the appropriate skill sets necessary to source 3rd Platform technologies. This strategic approach radically improves the business results utilizing intelligent technologies while also optimizing across the resources of people, process and technology within the entire business.
IDC, Research Vice President, Vendor Sourcing and Management
Mickey North Rizza
IDC, Program Vice President, Enterprise Applications and Digital Commerce