Does Two-Tier ERP Make Sense?
Many enterprise resource planning solutions are still firmly embedded in business as on-premise solutions, both physically and logically. But is the time right to consider a two-tier ERP solution which maximises the return on existing investments whilst also offering more business opportunities through its agile cloud-based approach?
INTERNET ACCESS IS A REAL PROBLEM FOR RURAL BUSINESS
For many, the idea of keeping such a business critical system as ERP as an on-premise solution makes a lot of business sense particularly given the transient nature of the internet and typical reliability of internet connections. According to a recent article in This is Money “More than 60 percent of rural firms are negatively affected by the slow speed of broadband in their area.” whilst InspiresMe recently reported research from the Forum of Private Business found 80 percent of members cited “broadband access – seen as a particular problem in rural locations.”. Internet access is improving but, in the UK at least, the pace of change is slow and, according to The Guardian “when it comes to high-speed broadband, the country is falling behind.”
TWO-TIER STRATEGIES HAVE HUGE POTENTIAL
However, internet connectivity can be improved though more effective infrastructure, such as backup/secondary and load-balanced internet connections, and whilst this may add to the operational costs of the enterprise the advantages may be worth it. A recent whitepaper from business technology company Cincom concluded “Two-tier ERP strategies have the potential to streamline new product development and increase time-to-market” whilst also identifying opportunities for further cost and time efficiencies. One of the key aspects of the whitepaper found many businesses find their current ERP system “does not support fast decision-making capabilities”.
The idea of tinkering with an existing ERP infrastructure may bring business stakeholders out in cold sweats and the idea of switching out an ERP entirely is not something any business should do lightly, the process can often take years, so one way a business could improve it’s decision-making capabilities is to move to a multi-tier platform.
Cloud-based Software-as-a-Service provider Netsuite recommend, in their two-tier ERP strategy kit, running subsidiaries on cloud ERP, for increased agility and reduced cost, whilst preserving the existing ERP for headquarters. There are many cloud based ERP solutions available including solutions from OpenERP, Microsoft, IFS, Epicor, and SAP and your existing ERP vendor may already have a two-tier ERP system available. If the idea of running multiple ERP systems is a worry then consider that in many mid-size or large enterprise multiple ERP may already be in operation, as a result of acquisition or diverse/multi-national markets, so the idea of multi-tier ERP solutions is already a proven reality.
ADDITIONAL TOOLS UNLOCK BUSINESS DATA
Two additional tools that can help two-tier solutions work effectively are dashboards (such as Klipfolio, iDashboards, and IBM Cognos Business Intelligence) for increased visibility of key performance indicators and business integration suites (such as iBOLT, IBM Websphere, and Microsoft BizTalk Server) which can synchronise information between data systems. With increased agility and tools available to handle the synchronisation of data, improve business intelligence, and speed up decision-making, two-tier ERP can make a lot of sense and could also act as a catalyst for reinvigorating an existing ERP platform.