Impact of Business complexity on ERP system

In today's fast changing environment and the impact of globalization, business became more complicated than before. The form of OEM, ODM, Joint venture has become more and more popular. Thus, the whole value chain has been extended to customers, suppliers and business partners. Under such circumstance, existing ERP solution could not satisfy organizations due to it only provide a simple interface with others. Furthermore, ERP system by nature only focuses on internal information flow and resource allocation. Such as the integrated IT platform make information go smoothly between different departments within organization. Everyone could easily understand and track the flow of their work. However the benefit so far only remain within the organizations. The collaborative business forms requires ERP system to provide more flexible solution and more focus on external relationship instead of just simple interface.

This is a big challenge for vendors to overcome due to more interest-related parties will be involved. To catch external business activity will be more difficult than internal ones. If the ERP system has to integrate IT system outside the organization, it will probably involve different type of systems, which may provide by different vendors and using different platforms and technologies. Moreover, if the organization has many suppliers and business partners, the size of ERP project will become too large to be managed. The impact of senior management involvement may not as useful as existing ones due to the fact that who could really in charge of the whole project should be agreed by different parties. Finally, when try to capture business activity between different business partners, how many business activities could be modeled? The confidentiality will also be an issue for ERP integration because these partners may be potential competitor as well. How many core business activities could be captured by uniform ERP system will really arise an issue.

To summarize, although the new business complexity globally has required more feature from existing ERP system, how to achieve them should go through carefully consideration.

Xin Jiang : 18 Jun 2012 00:54 |  Comments (0) |  Report a problem