Organizations have several options for leveraging technology to improve performance on integrated business processes, like Procure-to-Pay (P2P) or Order-to-Cash (O2C), including:
- Best of Breed (BoB) Applications
- Standalone Intelligent Automation (IA)
Each technology group has pros and cons.
|Centralizes/standardizes many business and finance processes
|Depth of functionality in some process areas may be limited; technologies have long integration and upgrade cycles
|Depth of functionality within a process area; most have pre-built connectors to ERPs and embedded RPA/AI
|Only addresses one functional area; may cover more functions within a process area than are needed/desired. Some ERP capability duplication may result
|Not specific to a single function or process, so it can be used in multiple areas and is relatively easy to implement
|Solutions must be custom-built, maintained, and adapted over time
How does an organization choose which tool or suite of tools best meets its needs? Careful consideration of the following factors can help guide the evaluation and decision-making process.
1. Functional Performance “Need to Haves vs. Nice to Haves”
How much room for improvement is available? Where there is a significant performance gap, improvements may justify the spending required to create and implement a solution. Where performance is high, lower-cost alternatives are better suited.
2. Position in the Lifecycle of ERP Implementation, Extent of Use, and Plans for Replacement
How long and strong is your commitment to the current ERP? ERP implementations are expensive, long-term projects that impact many functions. If commitment is strong, there can be pressure against utilizing additional tools. Does your organization use multiple ERPs and plan to continue with that approach? Often organizations have multiple ERPs due to acquisitions or other unique operating requirements, so moving to a single ERP solution may not be possible.
3. Availability of IT Support
Are IT support resources readily available? ERP solutions require the highest IT support and are a high priority for IT. While BoB solutions need less support overall, IT must still be engaged in ERP interfaces and testing. IA solutions require the least direct support from IT, because they are often built and maintained by business personnel.
4. Process Standardization Maturity
How disparate or standard are processes? Process variation may be driven by system differences or business requirements unique to a part of the organization, e.g., wholesale vs. retail operations. An organization’s desire to pursue greater standardization in processes is an important consideration for an ERP implementation.
Our Assessment of the Situation
|Functional performance “need to have” vs. “nice to have”
|ERP is a known platform but lacks some capabilities needed for the client’s specific industry
|Lack of ERP functionality would require significantly more manual processing, higher costs, and more potential for errors
|Position in the lifecycle of ERP implementation, the extent of use, and plans for replacement
|Strong commitment to move to a global ERP for finance but willingness to address critical shortfalls with other solutions
|Limited ability to influence ERP vendor selection or timeline of implementation
|Availability of IT support
|Organization has existing support for IA solutions but not for ERP customization
|Development and support available for IA but capacity constrained; development and support limited to ERP capability only
|Process standardization maturity
|Strong desire for greater standardization across operating units
|Transition to a single system enables greater standardization and better customer experience
Based upon all the factors above, our recommendation was to implement a BoB solution and interface it with legacy systems while the ERP is implemented over several years. Then, repoint the BoB to the ERP as legacy systems are decommissioned. Takeaways included:
- A BoB would provide “need to haves” that the ERP would not, avoiding the need to cover a sole ERP solution’s shortfall with manual work
- The speed to implement a BoB would outpace the implementation of a global ERP by years
- The BoB interfacing capability would allow for a phased repointing to the ERP as old legacy systems are decommissioned and provide easier integration for future acquisitions
Evaluation of your organization’s specific situation versus a set of criteria can help you determine the best approach when considering the variety of software tools on the market. ScottMadden can assess your organization to understand desired outcomes and software requirements to help your business become faster, more agile, and more efficient.