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The Future of ERP systems

The most asked question in the ERP world today is, what does the future hold for ERP Systems?

Gartner already mentioned it in a blog: ERP is out EBC is in. 

EBC enhances the capabilities of ERP’s third era into a more efficient format that meets the needs of both clients, and modern business operations. 

To better understand this current trend, we need to go back in history to the initial stages of ERP systems, even before they were named ERP: SAP developed a system that could track and support much of the financial processes and inventory management. Later they enhanced it with MRP. This became such a success in the manufacturing industry that, presto, SAP/R1 was soon to be named an ERP (Enterprise Resource Planning) system by Gartner.  

Other companies wanted to be part of this booming business as well. So soon giants like Oracle and Microsoft stepped in as well. And so, the fight began.  

ERP systems became bigger and bigger, supporting even more business processes while attempting to align to specific industry needs. Over time, these systems lost their “user-friendliness” as they tried to support as many different business scenarios as possible.  

And thus, a new trend was born: 

No more attempts were made to make an ERP system comply to the customer’s needs, instead the customer had to apply drastic “change management” to comply to the “needs” of the ERP system. Sometimes for the good, sometimes for the bad, but costly always. 

So, most ERP giants started to cut their system into smaller bits and built specific APIs to allow external systems to connect more easily. Some, like Microsoft, even established a “low code/no code” platform to allow users to build their own apps that would connect to Dynamics. 

Sounds good (and especially how Satya says it…).

And the Power Platform is certainly an effective way forward, though there is a “but” here. Which lies in the core engine of Dynamics or its complexity.  

The other “but” has nothing to do with Dynamics, but with how our global economy is evolving. Many companies only focusing on B2B, found that the covid pandemic had accelerated consumers tendencies to buy online, and so expanded their activities to B2C and often with remarkable success.  

Consumers are demanding though….

When they finally decide to purchase something, as a vendor you’d better give them accurate information about the product and delivery times. This requires ERP systems that are fast and always, even up to the second, have up to date actual inventory and product data. And anyone knowing Dynamics knows that it has neither………… 

Summary

So, to summarize, the EBC movement has started, and although it will not affect everyone and/or every company, the main advantage of an EBC system lies in its core. They are (or supposed to be): lightning fast, enable easy integrations with 3rd party apps, and therefore are modular by design.