SMEs Employ Diverse Strategies for ERP Modernization

Small and medium-sized enterprises (SMEs) in Germany, Austria, and Switzerland are modernizing their enterprise resource planning (ERP) systems through a diverse range of strategies to remain competitive both domestically and internationally. Findings from a survey conducted on behalf of proALPHA reveal significant variations in modernization approaches among these companies.

A substantial portion of businesses, 42 percent, plan to enhance their current ERP systems by incorporating additional functionalities. Warehouse management and logistics are particularly popular areas for expansion, where the use of mobile devices can lead to more consistent processes. For instance, the Bavarian State Mint reported immediate tracking of goods via scanning, improving process reliability and saving time.

Furthermore, 37 percent of companies intend to perform major software upgrades, while 31 percent plan to optimize existing installations with minor adjustments and configuration changes. A notable 24 percent are developing custom components, often with external assistance, believing their specific business processes necessitate tailored solutions. A similar percentage, 34 percent, are considering a complete replacement of their existing ERP system.

Improving the integration of ERP software with other business applications is also a critical focus. One-third of companies aim to enhance these connections. Additionally, 30 percent are opting to integrate specialized software for specific industry processes or emerging technologies like machine learning. Most companies appear to be combining multiple strategies to create a tailored modernization plan.

The survey indicates that there is no single 'golden path' to ERP modernization. Companies are choosing varied routes, and many are compiling a custom mix of strategies. Approximately one-third of these businesses are also leveraging external expertise to support their modernization efforts.