Why traditional ERP solutions are NOT the best
solutions for emerging markets like India

 
 
Bharath Gopalakrishnan
 
 

The density of presence of entrepreneurs in a country like ours is amongst the highest (if not the highest), and this is without counting the agricultural entrepreneurship. As I write this, there are newspaper reports that ë India will become the worldís third largest economy equaling or surpassing Japan sometime this year ñ much earlier than previously projected..í India is the best example of an emerging market, and this preamble is necessary, not just to pay tribute to the entrepreneurs who are participating in this economic boom, but also to provoke some thoughts on the subject of this article.
The fast paced market or business space in India is pretty much like the traffic we all wade through at the beginning and end of each work day. Unpredictable, and yet one filled with opportunities. This analogy is apt for mid-sized businesses and businesses that are above this threshold, in India, which are constantly evolving in fine-tuning the following:

Go-to-market strategies which often result in change of business models
    and distribution models.
Internal and external processes as a result of experiences primarily aimed
    at shorter and more efficient process cycles.

Work flows to adapt to the above.
And all other components that make the business plan for the business.

When businesses look for an ERP solution, their primary objective is to bring in a sense of knowledge management resulting in quicker, efficient and informed decision making, which helps run the business better, while addressing the pain-points of the various links in the business chain. Business owners know one thing well - how to run their business, for their environment (read market-space of their geography) and when they want to implement an ERP solution, they want the ERP solution to facilitate this. It is not the other way around. Instead, from what one has been constantly seeing, ëtraditionalí ERP solutions possibly more suited for developed and steady-state markets, first aim at strait-jacketing the business model, the internal processes, the associated work-flows etc to suit the traditional ERP being offered. This is the very pain-point that the business is grappling with ñ the process of change that results from growth !! Where does this path of ëtraditionalí ERP lead to?

The business adapts to the ERP
Do not go this path. Ensure that the ERP solution is flexible and is designed intrinsically for
iterative change in processes and work-flows

Long Implementation times
When the first step in implementation is to change the way you do your business, you are
looking at indefinite and prolonged solution deployment cycles. Instead, look for a solution
that can go live on day 1 of delivery and can dynamically and iteratively adapt with your
business, and its constant changes.

Visible and Hidden costs of ownership

Many of the ëtraditionalí ERP solutions reveal a purchase cost and a host of other costs which are varying depending on number of users, of CPUs, of database licenses you need and changes required for iterations if required after solution deployment due to their fundamental design and not being adaptable to iterativeimplementation. This leads to cost of ownership several times the cost of the user license costs. Know all the costs involved before hand that you will incur till the solution reaches a stage where it adapts to your business needs. And please value the cost of time taken as well, to reach this stage.

Business discontinuity

This is very key and vital in our environment. We are all used to power cuts/trips in our offices and this is in spite of having enough ërobustí UPS devices. In the event of a power failure, which could at least sometimes, result in a database crash, what is its impact on the business which is dependent on the ERP system being used ? If the answer is several days, then I believe the business is heading for trouble. The ERP for the India environment ( and other markets like India) should offer the shortest down-time in its business. Look for all aspects in the ERP solution that are suited for the best Business Continuity. Doí traditionalí ERP solutions offer this ? Please ensure you verify this!

These are only some aspects that have been put forward. There are quite a few more that business owners should look out for when selecting an ERP solution for their business. One thing IT has been successful in doing to businesses all around is to throw a lot of jargon. The ERP world is no exception. How many of these are myths? Plenty. For those interested, I would love to explain and this would befit a half-day seminar by itself.

As a final thought, let me leave you with this: When we buy a car in India, many of us look out for its adaptability to Indian terrain, traffic maneuverability, parking challenges, serviceability, visible and hidden costs. And all this changes everyday. We do not just look at the brand. Do the same for an ERP solution. Look out for how it suits your business for the Indian environment where you are constantly changing and evolving due to Growth. Remember, Growth means Change, and your ERP should be adaptable to this realistic paradigm.
 
     

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