New and interesting business prospects have emerged as a result of the rapid advancement of technology, which has made communication more accessible than ever before.
The capacity to transmit finance, information, and even human talent throughout the world at speeds that would have been unthinkable only a few decades ago creates an environment conducive to developing innovative ideas.
The massive needs of such far-flung ambitions, on the other hand, necessitate a similar set of complex systems to support and coordinate this movement.
Large industrial corporations have become more reliant on ERP — Enterprise Resource Planning — systems to maintain the precision of their complicated endeavors as one of the primary organising principles of our present social reality. Exploring the origins of these systems can reveal a lot about their present incarnations and the efforts they\’re supposed to support.
Exploring the ERP History
ERP frameworks are expansive bits of programming with a wide assortment of capacities and applications accessible to their clients. As ERP arrangements are eventually expected to assist with organizing huge scope business processes, their set of experiences is for the most part intelligent of this; they began as a method for extending the coordination of various assembling endeavors under one undertaking and later developed to incorporate more back-end experts too.
ERP frameworks—like most generally utilized programming arrangements—were first advanced to take care of a crucial issue of human undertaking. For this situation, guaranteeing the legitimacy of data across quickly developing organizations that would have been beforehand inconceivable. As the shape and construction of business have changed in the course of recent many years, so too has the product planned to help it advance.
In numerous ways, the historical backdrop of ERP frameworks is intently attached to the staggering improvement of PC equipment that portrayed a large part of the tech space in the last 50% of the twentieth century. Every decade has brought its new stage of ERP programming close by the most recent turns of events.
The expanding availability of robust PCs has likewise moulded the historical backdrop of this product, diverting it from an extravagance few could stand to a need for big business makers that has fashioned a not-immaterial presence among mid-market associations.
Evolution of ERP Systems
ERP systems have been around since the 1960s, but only recently have they come to be understood in their current form. Since their inception, they’ve gone through various iterations. The name ‘ERP’ was not developed until 1990, and there have been various modifications to that classification since then.
Inventory management systems are the forerunners
Most product-based firms employed their centralised computer systems to automate inventory before the lifecycle of this software solution began. These ‘IC systems,’ which first appeared in the 1960s and were mainly created in-house, rarely went beyond tracking the presence or absence of finished goods against monthly or quarterly output targets.
By today’s standards, such packages may appear simple—they lacked many of the functions of their modern counterparts—but they represent the first step in using computational machines to gather and use data in product-based manufacturing with the explicit goal of systematically optimising production and distribution.
MRP software
Materials Requirements Planning—MRP—the software was developed due to a partnership between IBM and J.I. Case, a tractor and construction machinery manufacturer. Since the days of mercantilism, the ability to compute the specifics of commerce has been a key demand of firms worldwide, and modern manifestations of this were no exception.
The manufacturers at J.I. Case discovered that by incorporating computational machines into their day-to-day operations, they were able to meet, if not exceed, the market’s increasing demands for greater coordination between the manufacturing of products, the procurement of raw materials, and the delivery of goods to and from their factories. The software accomplished this by automating operations and procurement scheduling.
This programme was only utilised by a small number of industrial organisations in its early stages. Due to the particular requirements of sourcing raw materials, making items, and transferring these products to ultimate sellers, these types of enterprises were fertile ground for a system like early MRP software to evolve.
Many corporations in the 1970s were acutely aware of the constraints of computing technology; the gear required to run a complicated programme like MRP software could frequently take up entire rooms to get the same processing capacity that we have now in our smartphones.
Only a few enterprise-level companies had the financial resources to feed such voracious mechanical creatures.
MRP II
The discovery of the CD and the release of Nintendo’s Game Boy were among the technological achievements of the 1980s. Manufacturing Resource Planning (MRP II) solutions were developed for production software.
This version of pre-ERP software focused on manufacturing process optimization by integrating raw material requirements and production schedules. These systems included the capability of older MRP systems, but they also began to combine overall coordination amongst the various departments responsible for the organization’s end product’s creation.
ERP
It wasn’t until the 1990s that true ERP software made its appearance. This resulted in the complete integration of the entire organisation into a single database, allowing for quick changes to market demands for MRP and MRP II system schedules.
ERP systems are defined by constructing a database that serves as a single “source of truth” for manufacturing companies. The integration of seemingly diverse areas like marketing, finance, and HR into one digital ecosystem is where this software outperforms MRP solutions.
ERP II
Many of the software’s respective suppliers developed even additional features beyond the primary front-to-back connectivity after the release and subsequent widespread adoption of ERP systems.
These “apps” or add-ons gave rise to the concept of extended ERPs, which could address a wide range of business challenges such as merging consumer interactions into the core dataset and customer relationship management through interface with CRM systems.
At this point, it may appear that ERP systems have just grown to be far more extensive than they should have been.
However, the truth is that each subsequent addition to the main software improved the program’s predictive power. The more data sources an ERP system has access to (through other programmes like a CRM), the better users can react to changes in demand or new trends in their business.
ERP II was defined by its connection with other efficient business software solutions, allowing major firms’ otherwise slow and heavy machinery to strike like lightning when a previously impossible opportunity presents itself.
The Cloud and ERP
In the most current version of ERP software, many companies have implemented ERP as an application or group of apps delivered remotely over the internet in the software as a service (SaaS) paradigm.
The remarkable improvements on the internet have enabled this cutting-edge technique of ERP deployment, which allows complete software packages to be distributed and controlled remotely without the end-user needing to invest in the hardware or infrastructure required to run huge systems like ERP on-site.
As a result, many organisations\’ entrance barriers have been considerably reduced, and ERP software has grown increasingly popular among mid-market businesses.
The ERP Industry\’s History
ERP\’s development was influenced by more than simply technological advancements at the time. By combining their own personal and historical traits, the companies that built these software solutions also contributed considerably to developing ERP systems.
While the introduction of the SaaS model has allowed dozens of new ERP suppliers to enter the market, the four oldest listed below have had by far the largest impact on the industry\’s trajectory.
SAP
Systems, Applications and Products in Data Processing (SAP for short) was created in 1972 in Germany by a group of former IBM engineers to provide business software for enterprise-level manufacturers. R/2, their first ERP system, was released in 1992. However, it wasn\’t until the release of the following version of this programme, R/3, that they exploded in market share and swiftly climbed to prominence as one of the industry\’s top providers, having over 17,000 customers by 1999.
JD Edwards & Company (JD Edwards & Company)
JD Edwards began in 1977 in Denver, Colorado, as a software provider for the IBM System I, an early minicomputer that many organisations utilised before the turn of the century. They created OneWorld, a flexible ERP system reaching many mid-market enterprises, as a flexible alternative to more comprehensive solutions. Oracle purchased it for $1.8 billion in 2003.
The BAAN Company
BAAN, a Dutch business founded in 1978, entered the ERP market with the notion that the internet is the \”ultimate enabler,\” Their approach to their software solution reflects that concept. They\’re known for their unrivalled cross-functionality across a wide range of business areas, and they have access to a unique technology called Orgware that helps with implementation costs and has propelled them to the forefront of the defence and aerospace industries.
Oracle
Oracle, the current industry leader, is a behemoth in the ERP world, and for a good reason. It has been in the ERP field since 1987 and is the world\’s second-largest software corporation behind Microsoft. Oracle Applications, their ERP system, has one of the most prominent application portfolios. Their database management software has served as the foundation for other ERP systems, making them both partners and rivals.
iERP: The future of ERP systems
With so many new advances in the digital field every year, it can be challenging to sort through the noise and determine what will stick to a given business. In the case of ERP, it appears that combining machine learning and artificial intelligence could open up exciting new possibilities for users.
These intelligent ERP systems (iERP) can theoretically leverage advanced data analytics to give tremendous predictive capacity to massive commercial operations at a global scale.
The proliferation of the Internet of Things (IoT) devices has impacted modern ERP firms. iERP could achieve unparalleled integration and agility by automatically sending commands to warehousing, procurement, and manufacturing units based on data received from other integrated software such as CRM by connecting production and distribution devices directly to the central database provided by ERP systems.
ERP in 2021
Cloud Adoption
In the year 2021, cloud ERP will be a huge draw. Cloud-based deployment strategies aren\’t new, and cloud-based ERP software isn\’t either. On the other hand, Cloud-based ERP use is predicted to soar by 2021.
ERP software was previously only accessible as an on-premise solution, prohibitively expensive for small and medium-sized firms due to hefty starting and hardware costs. ERP customers were also apprehensive about putting their company\’s data in the cloud. More companies are now entering the cloud-hosting market, enhancing cloud computing technologies and bringing ERP solutions to small and mid-sized businesses (SMBs). More companies are moving their data to the cloud to maintain and update their systems for less money. Because of their effectiveness, SaaS solutions will dominate the ERP market.
Two-Tier ERP
The present market trend is globalisation combined with localisation. Businesses continue to expand their wings in the worldwide market, but they still wish to focus on the domestic market. The two-tier ERP strategy focuses on tailoring the ERP solution to fit global and local needs. ERP meets the requirements of both large and small enterprises.
Many organisations have traditionally attempted to implement a single ERP system for their headquarters, regional offices, and affiliates. However, that method was frequently costly and difficult to adopt; subsidiaries often had unique requirements that did not necessitate the complete functionality of corporate systems, and they battled with a one-size-fits-all solution. As a result, one of the most popular ERP trends in 2021 is likely to be two-tier ERP.
Two-tier ERP is a technique that allows firms to use existing ERP solutions at the corporate level (tier 1) while using a different ERP solution (tier 2), which is often cloud-based for branches and divisions. This approach has a lot of benefits. It is frequently less expensive than changing the company\’s ERP system to serve the entire organisation. A tier 2 method may be more straightforward to deploy and provide subsidiaries with more flexibility in responding to changing market conditions. In addition, the two-tiered strategy may be best suited for high-growth businesses.
Artificial Intelligence (AI) integration
Integration of artificial intelligence (AI) is a popular trend in many industries, and it\’s been a hot topic in the ERP business for years. Companies must acquire a large amount of unstructured and complex data. Artificial intelligence aids in analysing data so that it may be used effectively.
Intelligent ERP, also known as iERP, is a business management software with AI that can analyze historical data and information from various departments to create more efficient workflows, make better decisions, minimize errors, and automate hours of repetitive processes. In terms of increasing business competitiveness and reliability, iERP is a game-changer.
ERP on the go
One of the most popular technologies that a modern ERP solution must contain is a mobile-ready ERP. Users can manage business processes on tablets and smartphones with internet connectivity at any time and from anywhere using this ERP software.
Mobile ERP software improves communication between departments and vendors/suppliers. As a result, the chances of service interruptions and commercial losses are reduced. Organizations that use this technology will see increased growth, agility, and cost control.
Integration of the Internet of Things (IoT)
Integrating IoT and ERP software has numerous advantages for businesses. This integration enables enterprises to collect, examine, and assess massive amounts of data using sensors. The manufacturing process is also continuously monitored, utilising real-time machine performance statistics.
What Is NetSuite ERP and How Does It Work?
NetSuite is a feature-rich, end-to-end enterprise solution. This ERP architecture improves business processes, roles, and actions in cloud-based platforms, allowing businesses to respond quickly and effectively to changing business requirements. Businesses may easily incorporate and expand their operations to different locations with the help of NetSuite, resulting in increased sales.
Organizational Activity Process Efficiency
NetSuite ERP connects disparate business processes. Among other company operations, order management, fulfilment, invoicing, cash collection, cost approvals, and financial consolidations. As a result, business activities are more efficient.
Data Access in Real-Time
Real-time data access has a number of advantages, including more integration capabilities, faster response to client requests, instant up-gradation, and higher connectivity. With a NetSuite cloud ERP platform for a company\’s operations, all of this is achievable.
What Will Happen Next? ERP in the Future
When companies realise that shifting ERP and its related modules to the cloud makes it significantly easier to attain the speed and agility they need to succeed in today\’s marketplace, they will likely accelerate their transition to cloud ERP. Those who have already invested in cloud ERP will look for new methods to use the cloud\’s capabilities.
Businesses will continue to focus on ensuring that ERP software is configured for remote work in the near future. Increasing process automation, mobile ERP functionality, secure remote access, and promoting remote training are all examples of this. Another trend to watch is the further expansion of ERP supply chain management capabilities, which will allow businesses to defend themselves from supply chain interruptions and quick changes in the global economy.
ERP in 2022
Interfaces instead of breaking points: ensure full integration
Individual divisions or departments are being digitalized at a rapid pace. On the other hand, a true transformation can only be achieved through seamless end-to-end procedures and the constant connection of all necessary systems. Solutions for digitization and integration, according to the digital association Bitkom and their whitepaper ERP trend check 2021 (German only), provide the required level of maturity and high efficiency. As a result, businesses should begin to identify and close process gaps.
Strengthen supply networks one by one
Along with rising pricing, most manufacturing organisations prioritise supply reliability for materials and semi-finished goods. Purchasing and supplier management must be efficient. Here\’s some good news from PWC, a consultancy business. It demonstrates that you can increase revenue by digitising your supply chain while lowering costs.
Smart before cloud: launch IoT initiatives
The Internet of Things will continue to gain momentum in 2022. A current survey by the British satellite operator Inmarsat predicts that the investments in the Internet of Things (IoT) will surpass the costs for cloud and other transformation technologies within the next three years. It\’s about time that all companies that have not yet addressed the topic of (I)IoT get underway. No more technological excuses. ERP systems have been ready to support new service and business models for years.
Data quality: rely on automation
The amount of data generated by the Internet of Things continues to grow. According to an IDC report (German only), nearly every third German organisation already experiences an annual data increase of 31 to 60 percent. According to 37%, the most significant problem is ensuring excellent data quality. However, many people still consider data cleansing a project rather than a process. With ever-increasing data volumes, there\’s no way to avoid automated, ongoing data updates.
Process mining: explore potentials
Processes that have already been digitalized have room for improvement. It\’s up to process mining to make use of it. Using order processing as an example, the authors of the Bitkom ERP trend check illustrate that if you want to use process mining to make your processes more transparent and optimise them, you need the data from the ERP system. It is, nonetheless, worthwhile to put forth the effort. Process mining has a lot of potential for Bitkom.
Solid future: become more sustainable
According to a Forsa survey (German only), 70% of SMEs regard sustainable measures as a key factor in their long-term performance. As a result, the ERP system takes on a new function. It provides the necessary data for resource and carbon management, such as reducing business travel, electricity consumption, manufacturing waste, and the use of paper, packaging, and production materials, as well as operating costs. Furthermore, when sales planning improves, surplus production is prevented. As a result, the ERP system serves as the one source of truth for all operations.
Data and information security: take security seriously
Companies in the manufacturing business are facing increased cyber threats as information technology (IT) and operation technology (OT) merge. According to a poll conducted by EY in October 2021 (German only), 44 percent of the organisations surveyed were victims of cyber-attacks last year, and the figure continues to rise. Hackers are for ransom, reputation, technological leaders\’ trade secrets, or customer data. As a result, businesses should talk to their ERP provider on what to do in the event of a cyber-attack.
Low/no-code software and self-service
\”Self-service,\” a term borrowed from the consumer sector and fuelled by months of quarantine, is back in the news. Simply put, no one else will take care of us if we don\’t. As a result, the concept of self-service ERP is gaining traction, as it provides independence that was previously unattainable. Self-service resource planning allows non-technical business users to construct customised dashboards and modify data sets and processes, from dynamically specifying field values to creating reports without the need for engineers.
The epidemic boosted the development of low-code and no-code software, pushed by enterprises\’ desperate need to modify their business models and introduce new client services, particularly remote working. Rather than beginning from scratch and relying on developers, low-code (or no-code) allows you to pick from a menu of alternatives or go through a plug-and-play configuration process to suit your requirements. Pre-configured building blocks that permit functionality components make it easier and faster to modify, construct, and publish apps without requiring IT help, compared to traditional legacy development/change management cycles.
The emphasis on employing self-service capabilities, powered by low-code technology, is here to stay as the business management software ecosystem continues to expand and remote working becomes the standard to assure business insights and accurate decision making.
From headless commerce to headless ERP
Retailers have always been on the cutting edge of technology. The retail industry frequently determines future trends in the physical and digital worlds due to ongoing connections with consumers and the need to stay relevant. Retail was the first industry to embrace the integration of a headless infrastructure to offer a consistent customer experience across all channels, which is no surprise.
Most customers nowadays only employ a portion of the system\’s capabilities, such as shop floor operations, inventory management, or e-commerce sales. The concept of a headless architecture advocates for the complete separation of business logic and data and the development of task-specific interfaces that are designed and implemented independently from the back-end. In other words, APIs are prioritised over user interfaces.
Complex procedures become simple when a headless architecture is implemented. User experiences are customised to serve each end-user, from warehouse staff and sales teams to human resources, store managers, and customers, with a personalised, cross-organization interface.
Cloud and ERP
Although cloud-based ERP is not a new trend, it is still one of the most revolutionary. Cloud computing opened up a whole new world of ERP, allowing firms to use cloud-hosted solutions to drive more efficient work practices, save time, the lower total cost of ownership, and help them redefine how they work. Despite the industry\’s concerns about data security, the cloud was successfully adopted, thanks to the increasing availability of mobile platforms and enhanced security.
SaaS ERP systems have dominated the market due to their open, adaptable, and scalable cloud applications. Many businesses that still rely on on-premise ERP are beginning to see how and why they fall behind. The epidemic highlighted operational limitations, ranging from inflexibility and costly scalability to a lack of innovation and incomplete collaboration, forcing many organisations to operate remotely, rendering on-premise solutions obsolete. Cloud
Machine learning and AI are at the forefront of the automation race.
Process automation tips the scales in favour of those who utilise it to \”accomplish more with less\” in a business world dominated by a culture of quick gratification. The integration of AI in every consumer-driven area, supported by AI\’s power to optimise data, is at the forefront of the race to automate practically every business management function. Face recognition mixed with personal preferences data allows the physical world to become a personalised experience, similar to an e-commerce business, acting as a data collection conduit rather than just an endpoint.
The rising AI trend will resound throughout all ERP features, including industry-specific solutions like manufacturing and distribution, in 2022 and beyond. AI technologies, such as machine learning, are assisting enterprises in extracting more value from the ever-increasing volumes of data generated. AI continues to enable businesses to get new, actionable insights, improve their operational procedures, and make the greatest use of their vast amounts of data.
Better business results with IoT integration
The Internet of Things (IoT), also known as direct machine integration combined with massive amounts of data, has shaken up the ERP landscape in recent years, providing new opportunities for operational excellence and process automation.
In terms of end-level computing, data centres, and customer experience, IoT integration plays a major role in the business automation revolution. Without establishing interfaces to external sources, IoT integration allows ERP systems to capture, store, and process enormous amounts of data collected from new, external endpoints in real-time. Industries use this data to gain accurate and relevant user information, as well as to answer their specific needs and wants. As a result, we\’ll undoubtedly see rapid advancement of IoT integration into the ERP ecosystem as organisations continue to demand advanced asset management capabilities, greater efficiency, improved forecasting, real-time insights, and enhanced interoperability, all of which are made possible by IoT.
The two-tier ERP imperative
The two-tier ERP strategy effectively uses \” two systems \” to handle the needs of large enterprises with many locations and/or subsidiaries; the two-tier ERP strategy effectively uses \”two systems.\” Master data management, or a single source of accurate data for the entire organisation, is possible with this technology. Large organisations that use a two-tier ERP strategy keep their corporate ERP system in place to manage day-to-day operations. In contrast, their smaller or remote business units use a second-tier ERP system to handle their unique requirements, such as location-specific regulations, compliance, and tax codes. With this method, organisations can gain business flexibility, agility, and strategy alignment at a lesser cost. Two-tier ERP systems are becoming more common as multinational corporations realise that more is not always better, contrary to popular belief.
What\’s the bottom line? Integrating corporate ERP solutions with second-tier, web-based ERP products that give unique regional and vertical industry features and functionality to global subsidiaries or branches will undoubtedly increase.
Cloud ERP Is Everywhere, But So Is On-Premise and Hybrid
Cloud ERP does not appear to be a natural fit for a list of 2022 ERP trends. After all, we\’ve been talking about it for almost a decade, and most companies are now cloud-only or offering a hybrid of cloud and on-premise deployments. However, it\’s possible that the \”on-premise to cloud ERP move\” isn\’t even 50% complete. It\’s not that CIOs worldwide haven\’t heard of or contemplated cloud computing; it\’s just that many haven\’t yet found the impetus or budget to make the switch.
On the other hand, older on-premise ERP systems are vulnerable to a range of threats. The obvious and present threats of ageing on-premise ERP systems include:
- End-of-life operating systems
- Difficulty locating ERP DevOps staff
- Large functionality and technology gaps
- Inadequate defenses against the increasing threat environment
Any CIO does not want to talk to the CEO about an ERP downtime. Furthermore, older on-premise ERPs are frequently a major roadblock in the path to digital transformation. To summarise, the case for moving to cloud ERP is stronger than ever, and the migration will continue. It\’s possible that we won\’t see an end to it until the second half of this decade.
Data management and cloud virtual image
In 2022 and beyond, hybrid ERP deployment approaches will continue to thrive. Many corporate software developers recognise and cater to this requirement, as some businesses still value both on-premise and cloud-based enterprise solutions. Furthermore, many large worldwide firms can afford to host their environments in their own data centres rather than rely on hyper-scalers like Google, Amazon Web Services (AWS), Microsoft, IBM, Nutanix, and others. While initially capital heavy, owning one\’s data centres has a reduced total cost of ownership (TCO) in the long term for those who can afford it.
Mobile ERP With Real-Time Awareness Will Continue to Proliferate
Mobile ERP, like cloud ERP, may not appear to be a showy addition to an ERP trends report for 2022, but the two go hand in hand, and mobile ERP is poised to continue increasing and evolving.
Before the pandemic, mobile ERP was well on its way to becoming the standard. Still, since then, there are probably very few enterprises that don\’t see the need for it and aren\’t going to integrate it into their ERP ecosystems fully. Companies who were able to feel the demand and other market changes and continue operations from their employees\’ homes after the pandemic hit their territory fared significantly better than those unable—many of the businesses that failed partly because they were not mobile-ready. Even if the pandemic subsides in the coming year, the work-from-anywhere model will persist.
One of the most significant advantages of mobile ERP is real-time data. Mobile technologies enable streamlined, and real-time data capture directly from the source—for example, during asset installation at a customer\’s plant, from a busy factory floor, and so on. To make smarter, better-informed business decisions, companies require this precise and fast data flow.
On the customer management front, real-time data enables businesses to enrich the customer experience (CX) by gathering relevant data and personalised recommendations from many departments and sources while conversing with customers.
Although mobile ERP is a foregone conclusion, its penetration into more and more company systems and processes, as well as its adoption by late-comers, will continue. The ability of mobile corporate solutions to sync data and procedures when the user returns to the Wi-Fi range will continue to be in high demand.
Intelligent ERP Will Make Big Gains
Artificial intelligence (AI) and associated technologies such as machine learning (ML) are worthy of consideration in a 2022 trends study. AI and machine learning have been integrated into ERP software to build \”intelligent systems\” that attempt to turn a plethora of company data into meaningful insights for process optimization.
ERP systems with zero-touch automation, interactive support, an intelligent advisor, and other innovations are becoming more common, allowing businesses to streamline procedures and achieve new levels of efficiency. Intelligent ERP can improve operations, minimise lead times, and eliminate data input and processing errors. AI-based solutions can also use data created by the system to aid in better-informed decision-making by detecting red flags before they cause a business disruption.
The extensive use of robotic process automation (RPA) to transform business operations has resulted from automation capabilities to software systems. Bots and automation technologies in ERP solutions help accomplish repetitive operations (such as onboarding, data collecting, and so on) and free up employees to focus on value-added activities while improving corporate productivity. AI-based ERPs may help with fundamental tasks like credit analysis, digital marketing, targeted customer support, and product configuration recommendations and more involved tasks like production or scenario planning, offering strategic insights.
In 2022, we expect all major ERP software providers to announce new features and product development roadmaps that incorporate increasing AI and automation augmentation for many basic business operations. Google, Microsoft, and Amazon\’s bundled AI toolkits, as well as open-source alternatives, will level the playing field. As a result of their younger, more agile technology stacks, many smaller vendors will stay up with, and in some cases outperform, tier-one competitors. Expect ERP to get smarter every year.
“AI and BI for the Masses”? Not There Just Yet!
The idea of \”AI for the masses\” or \”BI for the masses\” seems to be early. The notion is that AI and BI are becoming so widely available that the great majority of consumers will use them to improve their productivity.
However, most AI/BI/analytics capabilities are still out of reach for the typical corporate employee. While some integrated analytics can assist users in obtaining insight, even these low-hanging fruits often necessitate some vendor user training. Most firms will still need a full-time analyst or data scientist to get relevant and actionable insights from the present version of AI and BI tools.
The next generation of intelligent ERP systems must be user-friendly, and ERP suppliers recognise that there is still work to be done. In 2022, we expect tremendous progress on this front, with the average employee being equipped with greater competencies and knowledge, though development will continue beyond that year.
Hyperscaling Is Big, but It’s Not a Magic Bullet
An expert\’s ERP forecasts for 2022 and beyond include supporting corporate expansion by collaborating with hyperscalers. Hyperscalers are businesses that have dominated the public cloud and cloud services space while also extending their offerings. Google, Facebook, Microsoft Azure, and Amazon Web Services are examples of hyperscalers.
While hyperscalers and infrastructure as a service (IaaS) providers make cloud deployments more appealing, someone (whether it\’s the internal IT department, a system integrator (SI) or consultant, the ERP vendor\’s professional services, or all of the above) must still determine, implement, and maintain the following, among other things:
- correct infrastructure size
- scaling model
- proper enterprise system configuration
- performance monitoring
- penetration testing
- data recovery testing
- patching and fixes
Hyperscalers ostensibly simplify and automate parts of those duties and processes, but they are not a way to eliminate or replace considerable human effort or entire enterprise software systems. Hyperscaler cloud service providers will design, build, and maintain the software, data, and systems that hyperscalers give or produce, emphasising that hyperscalers do not provide a comprehensive solution.
Hyperscalers can be compared to the main electric power supply for a home. The fuse box/electrical panel and a usage design are still required (what is the consumption, what is the peak, how to cut power during downtimes). You must still choose your appliances, lights, and electrical design, among other things. And you still have to figure out how to best use the power.
On that note: some ERP vendors have boasted about their early adoption of AWS or another hyperscaler platform, yet they’ve only recently begun offering services to help their customers use the platform. There’s a lot of room for growth and improvement here, so while we expect hyperscaling to expand widely, we caution that it’s not a magic bullet.
Multi-Instance ERP Sticks Around and Gets Future-Proofed
Single-instance ERP software (i.e., every tenant is on the same current product release simultaneously) has long been a selling point for ERP suppliers, and the cloud should make it much more compelling. However, it may not meet the needs of major businesses (those with revenues of $500 million or more), particularly those involved in mergers and acquisitions, x-shoring product expansion, and/or a commitment to shared services efficiencies. And, when it comes to risk, a single occurrence shouts danger. Some businesses would prefer the option of migrating to the newest release just when they are ready and confident.
Smart CIOs have realised that multi-instance ERP is here to stay, therefore rather than battling it, they are embracing it. Multi-instance ERP, as a result, deserves to be included in any discussion of ERP trends for 2022. It can provide optimal business unit or subsidiary fit while also lowering risk through democratisation.
ERP Takes a Backseat to SCM
While we were already on the verge of supply chain chaos owing to geopolitics, which made the already complicated world of global commerce and tariffs practically incomprehensible on any given business day, the COVID-19 epidemic exacerbated the issue. Everything to do with supply chain management (SCM) is on everyone\’s mind these days. Who\’d have guessed that the terms \”supply chain\” and \”supply chain management\” would become commonplace? Even our octogenarian parents and grandparents are now aware of the concept of a supply chain.
The number of applications for AI in SCM appears to be endless. Organizations of all types and sizes must now use technology to obtain as much visibility into their supply chains as possible, as well as the freedom to pursue various sourcing strategies. They must foresee potential supply chain problems and devise strategies to avoid or mitigate them. They must also become more efficient, reduce inventory and shipping costs, and become more robust and capable of meeting tight delivery deadlines and exceeding increasingly high client expectations.
Vendors will spend a lot of money in 2022 to improve their transportation, global trade management (GTM), supply chain planning (SCP), and multi-echelon inventory optimization (MEIO) capacities by adopting AI and other modern technologies.
Expanded ERP Integration and Interconnectivity
While SCM software vendors like SAP Ariba, Coupa, and One Network may make significant investments in their supply chain products, one 2022 ERP trend to watch is deep integration between SCM and ERP systems. Due to the inextricable link between production and material availability, integrating these two enterprise systems will provide manufacturers and distributors with the highest business efficiency and agility levels. E-commerce, shipment automation, journey planner, warehouse management, digital payments, fleet tracking, and other associated capabilities will all be included in the integration.
Additionally, as companies find point solutions to address their specific company or industry needs, the demand to connect those solutions to the ERP mothership will grow. ERP suppliers will continue to develop their system integration capabilities to enable key actors and enterprises to efficording to one of our 2022 predictions. End users will benefit from higher efficiencies, fewer redundant processes, and better visibility into corporate data through a single pane of glass. RESTful application programming interfaces (APIs) and microservices are becoming the norm for easy integration. It is no longer possible to move forward without them.
3D Printing and ERP Evolve Together in Manufacturing Sector
While 3D printing and additive manufacturing are commonplace among many industries, they deserve to be included in 2022 ERP trends and forecasts research, especially in light of recent supply chain disruptions. The development of ERP systems to solve demanding supply chain scenarios and printing environments will be influenced by the evolution of 3D printing and additive manufacturing.
More and more enterprise systems, such as product lifecycle management (PLM), computer-aided design (CAD), and enterprise asset management (EAM), are incorporating 3D printing (EAM). This technology allows for seamless part change and testing via its digital thread and better accommodates the manufacture, distribution, and maintenance needs of large manufacturing goods.
As a result, 3D printing will be critical in creating smaller batches (typically just one), specialty part numbers, and other unique manufacturing requirements to finish larger contracts, giving manufacturers who can support future manufacturing scenarios a competitive advantage. To support material and capacity planning and lead time determination, and fulfill the overall needs of these additive manufacturing production settings, ERP software for manufacturers will need to be very adaptive.
ERP Gets Redefined
With the pandemic having accelerated disruptive forces that were already gaining momentum (modularization of enterprise systems, increasing demand for custom products, same-day delivery standards) and introduced new disruptions (career upheaval and The Big Quit) altogether, another 2022 prediction is that ERP will reach a tipping point of change significant enough to call it a redefining.
Final food for thought
ERP will continue to expand and produce new technologies and operational workflows to adapt and bend to the winds of change in the race to become more efficient and reinvent how organisations function and communicate. Because change never stops, it accelerates, we will undoubtedly see more developing trends in 2022 and beyond. It\’s maybe appropriate to recall Charles Darwin\’s remarks here: \”It is not the strongest of the species that survives, nor the most intelligent; it is the one most adaptable to change.
