Integrating Business Systems - Part One

Is your business hampered by double entry of data and/or inconsistent data, and are the KPIs that you need to use to run your business all available when you really would want them?
Perhaps more fundamentally, are you wondering when and how to start integrating your ERP or business system, and has that business system been maintained and upgraded?
So many questions - that lead on to another - Are you wondering whether you should be upgrading or replacing your business system?
Over the next few articles, I'll try to give you some pointers to help you develop a plan, which will be based around the following topics:

1. Developing a sound reason to integrate, a business case and an efficiency (or quality) issue to resolve.
2. Making the decision on whether to upgrade your ERP or Business System.
3. Mitigating the risks of an ageing ERP or Business System.

 
Let's take them one at a time.
 
PART ONE : Integration Business Case
 
We all like an elegant system - one where we enter data once, and we have a full and accurate view of data transitions throughout our systems (such as an ERP and maybe a design platform). However, we also live in the real world - with its commercial realities. So, are you clear on the payback for the effort and cost to integrate? 
The payback for an integration could be found in a number of ways:

1. Cost reduction - we may be able to remove a role. 
2. Efficiency - we may be able to free someone up for more value adding work and/or remove the need to add a role when expanding.
3. Quality - we may be suffering data quality issues with too much double entry of data, and humans nearly always introduce errors. How much do those errors really cost us?

 
Finally, don’t completely rule out the decision to integrate to improve your Data Quality as a baseline and qualifier for future expansion. Many companies ignore Data Quality and leave themselves sustaining a culture of approximation, and this combined with inconsistent data, means use of modern AI technologies is just impossible. How do you attract talent to work somewhere that inherently disables the implementation of new technology because its data is so poor?
We must develop a clear case so that all resources will understand the reason and benefits for the project - even if it is the acknowledgement that this is hygiene. Remember though, there is an ongoing cost to the business when introducing an integration technology. We should plan to monitor, manage and upgrade this integration platform, otherwise, we are creating more legacy and yet a bigger problem down the line.
If you can identify the benefits of integration formally, or strategically (for talent attraction and as an improved baseline as above), then there are further clear steps to be taken:

1. Document what data lives where now, and does Data Protection apply.
2. Document where the master data should live. 
3. Agree the Change Management of that documentation BEFORE any activity commences (i.e. what the process is for future change, how/where it is documented and who can approve).
4. Integration Platform selection.

 
The platform selection at this stage, is difficult. We must consider the Total Cost of Ownership (upgrades, resources required to manage it, subscription costs, installation costs), frequency of update (is real-time required or is overnight sufficient?), but also look forward to understanding the likely future scale. If you've defined a financial goal, how long might this platform have to pay for itself.
Even simpler, is a new single system encompassing all of your activities likely to be a cheaper choice.
Perhaps the most important result of working through this activity, is a greater understanding of where you are now in terms of a documented state of your data, the internal cost of that in-efficiency and the forming of your strategy to deal with it. You have also introduced the concept of Change to your team as a precursor to anything that follows. Let’s call this “Digital Readiness” – it’s about being in a position where you can be more Data Driven and re-use your data to drive more efficiencies and / or surface the data to your clients that they need to see (performance or product data).
 
Next time, I’ll be covering the second issue - Making the decision on whether to upgrade your ERP or Business System.