How to Check the Health of Your ERP System
What is ERP health and why is it important to assess the health of your ERP system? Because the results reveal the capabilities and strength of the technology you lean on to manage your core processes and drive the performance of your business.
Performing a health check, and taking measure of your process maturity, provides your company with an evaluation of the value of and risks within your system, and an assessment of your ERP solution’s overall capabilities.
ERP Maturity and Health: Is Your Business at Risk With Your Legacy System?
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Manufacturers and distributors that rely on out-of-date, legacy ERP solutions may be exposing their companies to avoidable risks. It’s critical to have an accurate evaluation of ERP health to determine if it’s time to invest in a new solution. By taking the time to assess health, a company decision-maker will have a more informed perspective on the viability of their current ERP solution.
But where do you begin? And what factors must be measured?
A thorough examination that works through these five areas can determine if your company is being held back by an out-of-date legacy ERP system:
Five Areas of Focus
Your initial questions about your system must relate to value, specifically:
- What is the value that our current ERP system is providing?
- What is the value of a new ERP system?
- Can our existing ERP system match the value of the new ERP?
- Is our business being held back by the lack of an ERP system or one that is up to date?
Questions on risk tend to revolve around the potential for the system to go down or be unable to recover after a disaster. And, to be sure, questions of business continuity and catastrophic failure are important to address. But there are other risks that are far more damaging to a company, and that occur with far greater frequency:
- System and hardware deterioration
- Vendor support changes
- IT staff’s ability to support the system
- Security maintenance and gaps
- Changing government regulations
- Vendor stability and strength
The health assessment must take into account the direct and indirect costs of an implementation. A new ERP system represents a major investment in capital expenses and staff resources, as well as other components like change management and training. Make the effort to get an apples-to-apples comparison of the cost of maintaining your existing system versus implementing a new solution.
Ready to know more?
The Ultra Consultants team are experts on how to check the health of your ERP system, using a structured, comprehensive approach. Contact us to discuss a health check.