ERP Comes of Age - Anthony W. Perrone 8212015

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ERP Comes of AgeFrom Differentiator to Essential Building BlockWhat you need to know about what’s coming

August 2016

Anthony W. PerroneVice President, Enterprise Technology Solutions


ERP to Date

Strengths• Common, integrated data• Single version of “truth”• Facilitates Internal Controls• Official Transaction

Repository – Detailed History

• Can Be Transformative Catalyst for change

Challenges• Has become “table stakes”• Focused internally• Implementation may be

lengthy and costly• Technical installation vs

effective implementation• ERP by itself rarely offers

competitive differentiation


Data, Information and Its Relative Value

• Enterprise Sustainability Management

• Business Intelligence

• Enterprise Resource Planning

• Manual Accounting

Wisdom

Knowledge

Transactional Data

“Chaos” – Nothing But Financial Information

Rel

ativ

e Va

lue

Sust

aina

bilit

y Po

tent

ial


ERP: No Longer an “End All”

Changes We Already See• Market demanding “cheaper, better, faster.”• Customer experience• Race for “disruption”• Business, socio-economic, and

environmental interdependencies• Increased availability / adoption of SaaS• Consumerization of IT• Internet of Things (IoT)

Rate of Change

Rate of organization’s ability to adapt

“Innovation Gap”


Global Mega-Trends Re-Shaping Business

Changes To Come• Acceptance of climate change prompts business risk mitigation• Increased regulatory pressure• Sustainability reporting transparency• Development of 3rd world countries• Aging population and displacement of Baby Boomer Generation• Innovation Engineering

- Relentless pursuit of “cheaper, better, faster”


Business System Maturity Model

Chaos

LedgersNotebooks

Paper

Limited Data,

Islands of Information

Silos – No Integration

Accounting Systems

Mainframes and Dumb

Workstations, “Time

Sharing”

More Data, Islands of

Information

Inter-Departmental

IntegrationMRP & MRP II

Mini Computers, PCs, Local

Area Networks

Closed-Loop

Information and

Internal Transactio

n Flow

Supply Chain Integration

ERP & ERP II

Client-Server, LAN/WAN,

Internet

Integrated Information

Flow – Internally and with Trading Partners

Transaction Recording and Reporting


Chaos

LedgersNotebooks

Paper

Limited Data,

Islands of Information

Silos – No Integration

Accounting Systems

Mainframes and Dumb

Workstations, “Time

Sharing”

More Data, Islands of

Information

Inter-Departmental

IntegrationMRP & MRP II

Mini Computers, PCs, Local

Area Networks

Closed-Loop

Information and

Internal Transactio

n Flow

Supply Chain

IntegrationERP & ERP II

Client-Server, LAN/WAN,

Internet

Integrated Information

Flow – Internally and with Trading Partners

Transaction Recording and Reporting Wisdom & Insight

Mor

e H

isto

rical

Mor

e Pr

edic

tive

Business Sustainability MoreLess

Business System Maturity Model


Information: Life-blood of Innovation!


What Drives Innovation?

61% of CEOs say that innovation is a priority or a primary focus within their business. PwC Survey

• 57% - right culture

• 44% - strong visionary Leadership

• 37% - willingness to challenge norms & take risks

• 31% - ability to capture ideas throughout organization

• 31% - capacity & capability for creativity

KEY: Must generate LOTS of ideas and discern the best

Products Market Expansion

Channel Partner

Relationships

Services Production Processes

Facilities Improvement

DAT

A fro

m In

tegr

ated

G

loba

l Sys

tem

s


New & Maturing Application Suites

• 1st Time Gartner Quadrant – 2014

• Traditional Players

• Maturing Specialized Players

• New Entrants

• Scope- Environmental Management

- Health Management

- Safety Management

- Product Safety

- Risk Assessment & Analysis

Gartner Magic Quadrant – EHS Suites


Enterprise Sustainability Management Application Architecture

EHS

Energy Mgmt

Carbon Mgmt ERP

PLM

Enterprise Risk Mgmt

Social Media

Data Warehouse

Faci

litie

s M

gmt D

ata Product Usage Data

Public Domain Data

Customer Experience

Inference Engine


Implementation Implications

• Start with desired end state• Engage customers and other external stakeholders• Optimize business processes more broadly• Sufficient focus on Change Management• Technical architecture becomes more strategic decision• Project management PLUS program management• Enables creative design and implementation of

market-making business models


Summary

• Stable ERP an essential, foundational building block • ERP is technology best applied as tool for business

transformation• Business transformation requires being mindful of people,

process and technology• Organizational change management is critical

implementation element• Integration of external data has become increasingly

important (e.g. Customer Experience)


Summary

• Management by information – never more critical• Resulting wisdom & insights fuel engineered innovation• Project management still essential • Program management skills becoming more relevant• Enterprise Sustainability Management – a collection of

integrated processes, application systems and management principles to support innovation of emerging business operating models


Thank You!Anthony W. PerroneVice President, Enterprise Technology SolutionsProNexus LLC171 Sully’s TrailPittsford, NY 14534

[email protected]

mailto:[email protected]

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