ERP is still costly and time consuming. But the good news, according to recent research by Boston-based AMR Research, is that companies are finally accepting ERP as a strategic part of the business. Accordingly, AMR analysts say, further investments in the technology will require sound business reasoning beyond the cost-saving arguments that initially brought ERP to life.
“It all has to do with the attitude that companies take with their ,” says Alison Bacon, AMR analyst. “The business people have to be involved and realize that it’s not an IT-only issue any more.”
AMR Research surveyed 109 companies (70 percent of which have annual revenues exceeding $1 billion) and found that 85 percent of them listed improved ease of use, additional functionality and improved collaboration as the primary benefits to an ERP upgrade. Just 13 percent listed cost savings as the main motivator.
“Increasingly, people are not looking at as just a big piece of software, but it's being seen as a core strategic asset of the company,” says Judy Bijesse, AMR analyst. “It’s much more important that the system remains relevant and adds functionality.”
Half of the companies surveyed added an average of three new functional areas to their ERP systems. The most popular were portals, Internet-based procurement applications, self-service HR and business intelligence. AMR Analyst Allison Bacon says ERP is taking on an even broader set of applications today than before.
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