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Mastering multiple ERP madness: 3 tech-enabled tactics for success

Enterprise Resource Planning systems, or ERPs for short, are the lifeblood of an organization. These software platforms help to manage, automate, and centralize core business operations.

When looking for a best-in-class approach, having all businesses run on a single instance ERP is, objectively, the optimal solution – helping to minimize cost, streamline workflows, and standardize processes. But when you’re dealing with budget limitations, complexity of a new implementation, resource constraints, or a big change to the business, best-in-class isn’t always possible in the short-term. Moreover, multi-ERP environments are also standard operating fare as a result of a few common business archetypes:

  • The Acquirer: Companies that grow through acquisition often inherit the diverse technologies of the entities they acquire. Each acquired company may already have its own established ERP system, chosen to fit its specific needs pre-acquisition (size, industry, budget, etc.). Consequently, as these companies integrate with the acquirer, they’re likely to end up with multiple ERP systems across different divisions or subsidiaries.
  • The Conglomerate: The Conglomerate is similar to the Acquirer, but differs in that different ERPs are serving the needs of their different business lines. Truly unique industries or business segments under one roof may require enhancing specific geographic processes, addressing regulations, or aligning to customer requirements that necessitate specialized ERP solutions. As a result, these companies may deploy multiple ERP systems to effectively manage and optimize operations across their various business lines.
  • The Legacy: For a multitude of reasons, some companies have a long history of legacy ERP systems that have been around for years and are either too resource intensive to replace or work fine as is. In some instances, even post ERP transition, businesses find themselves leveraging historical data in their legacy ERP systems for reporting or operational business processes. In these cases, operating out of a single ERP may not be an imminent priority.

Is a multi-ERP environment ideal? No. The long-term solution for enterprises should be consolidating to a single ERP. Nevertheless, it’s often the reality of the situation. So, the question begs: How can businesses mitigate the pain points and make the most of multiple systems? The answer is technology. More specifically, companies can use pointed technology solutions as a best practice for dealing with multiple ERP environments in one of three ways:

  1. Consider CPM – ERP’s MVP: There are (some) instances in which multiple ERPs can bring (some) operational efficiency to a company – but with that operational efficiency comes an inability to measure the business as a whole. Seemingly simple activities like consolidating full company financials, standardizing a budget process, or viewing key KPIs becomes increasingly difficult with disparate systems that don’t speak to each other. Enter: a CPM solution. These platforms help to act as a single source of truth for financial and business performance, adding capabilities like the ability to map multiple ERPs to standard reporting structures, establishing automated connectivity to drive more streamlined budgeting and reforecasting, and workflow to guide the close or budgeting process across key stakeholders. While an ERP is designed for operational efficiency, CPM platforms are designed for business performance management efficiency and can serve as an effective interim solution in a multi-ERP environment.
  1. Govern multi-system madness with data governance: One of the most talked about, but surprisingly least leveraged, ways to improve a multi-ERP environment is through better centralized data governance. The concept here is simple: because there are multiple cohorts managing multiple ERP systems, aligning the business through company-wide data standards is critical. This can be achieved through orchestrating better or more specific data governance rules. (Think: ‘new accounts added to the P&L in any ERP should all have a management reporting alignment’ or ‘product naming conventions across all systems should follow the same structure’.) Good data governance requires both an investment in process (approvals and workflow) and technology. Technology via “Master Data Management” solutions, can serve as the funnel point for new requests and data model adjustments that then flow down to multiple ERPs.
  1. Automate, automate, automate. More often than not, in a multi-ERP environment, data flows across many systems, business units and practices. Perhaps you’re uploading a trial balance from a small ERP into your primary ERP. Or you’re loading GL data from multiple ERPs to a budgeting or reporting platform. Or maybe your architecture consists of many technical workflows that connect systems like CRMs and HRIS platforms to your ERP. In any case, the manual work necessary to transition data between systems can, and often will, drag down the organization and prevent team members from focusing on the key strategic needs of the business. Automation, and ETL (Extract, Transform and Load) platforms that drive data flows, can mitigate the button pushing and provide a much quicker path to results.

Multi-ERP systems, while rarely ideal, are far from rare. For all the reasons companies must learn to live with them, at least in the short-term, there are an equal number of ways to optimize a multi-system environment. Technology plays a crucial role in doing so. The right technology add-ons can enable businesses to effectively manage and derive more value from disparate ERP solutions.

Meet the authors

Justin D'Onofrio
Justin D'Onofrio
Managing Director, Performance Management Team Lead

Justin is a Managing Director and Planning Solutions Team Lead within Accordion’s CFO Tech Practice. He has more than 15 years of experience leading the deployment of forecasting and analytic solutions for companies ranging from PE-backed to Fortune 1000.  Read more

Ana Lambe
Ana Lambe
Senior Director

Ana is a Senior Director in NetSuite Services with 8 years of digital transformation and system implementation experience for companies ranging from Fortune 100 to small LLC’s. She has industry expertise working with companies in software & technology, professional & financial services, and media & publishing.  Read more

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