Enterprise resource planning (ERP) software systems have long been instrumental in helping businesses and enterprises streamline their operations, improve efficiency, and make data-driven decisions.
These all-encompassing solutions traditionally integrated various functions like accounting, human resources, supply chain management, and more into a single platform, facilitating a holistic view of business operations.
ERP Systems Evolving in a Digital-First World
In today’s digital-first world, ERP systems are being called up to do even more.
“ERP solutions have matured and expanded their reach to support most business functions, from back-end processes like accounting, HR, procurement, and manufacturing to front-office functions such as sales force automation (SFA), marketing automation, and e-commerce,” explains Oracle. “Businesses rely on ERP to not only cut costs by eliminating redundant processes and automating mundane tasks but also to provide employees access to critical information to make better decisions, faster.”
Far from being static, the world of ERP is constantly evolving, adapting, and embracing emerging technologies and trends to stay at the forefront of digital transformation.
“As companies increasingly rely on ERP to run their businesses, these systems continue to evolve to incorporate new technologies and support a broader range of functions,” says Oracle.
Adapting in Unpredictable Times: Modern ERP Software
SAP points out that we are living in truly unpredictable times – which just might be the “new normal” for businesses.
“We’ve seen a level of disruption no one could have forecast: an ongoing pandemic, the war in Europe, climate disasters, inflation, and in many countries, political chaos. We’ve been living in a “permacrisis” – an “extended period of instability and insecurity” so inescapable that in 2022, Collins Dictionary named “permacrisis” its word of the year,” says SAP. “There is no going back to normal. This is normal now – and tomorrow’s normal will look different again.”
The key, according to SAP, is that businesses that have not only survived the turmoil but have thrived, have been those able to adapt to change very quickly. And when it comes to adapting to change, ERP is essential.
“Usually, the way they’ve been able to do this is with a modern ERP system that can help them innovate, decide, and adapt at a rapid clip – with confidence. These systems are incredibly agile – and incorporate the latest trends to keep the companies that use them on the leading edge,” says SAP.
Crystal Ball: ERP Trends and Innovations to Watch
While we agree that these are unpredictable times, it won’t stop us from dusting off our crystal ball and looking toward 2024 for emerging ERP trends and innovations.
After all, keeping an eye on what’s coming next is crucial for selecting the right ERP solution that can lead to success and staying ahead of the competition.
Here are 25 ERP trends and innovations to watch for 2024: While many of these trends are not entirely new concepts, the rate of development and use of these technological innovations is advancing rapidly and opening new opportunities for businesses to shift and create competitive differentiation:
- 1. Continued Adoption of Cloud ERP: Cloud ERP systems offer scalability and accessibility, reducing the need for costly on-premises infrastructure. They enable real-time data access, making it easier for teams to collaborate and make data-driven decisions from anywhere, promoting remote work and flexibility.
Oracle says: “Businesses are adopting cloud ERP to take advantage of a simpler deployment, lower costs, elasticity (i.e., the ability to only use the necessary resources at any given time), new functionality, less need for internal IT resources, and the ability to easily add users and functions to accommodate business growth.”
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- 2. Artificial Intelligence (AI): AI-infused ERP systems use machine learning algorithms to analyze data, recognize patterns, and provide intelligent insights. They can automate routine tasks, like data entry, and help businesses identify opportunities for cost reduction and process optimization, ultimately improving decision-making.
Oracle says: “Artificial intelligence and machine learning capabilities embedded into ERP systems work behind the scenes to help meet increased demand for personalization and improve a broad range of business processes. While companies could add AI functionality to some ERP systems in the past, more vendors now offer ERP software with these capabilities built in.”
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- 3. Internet of Things (IoT): ERP systems integrated with IoT devices enable the collection of real-time data from interconnected sensors and equipment. This data helps in monitoring and optimizing production processes, reducing maintenance downtime, and improving resource allocation.
Says SAP: “When combined, ERP and the Internet of Things (IoT) also offer a wide range of business benefits. For example, data from mobile scanners and smart conveyor belts can be used to track goods within a warehouse. Cars can provide real-time information back to manufacturers, who can then identify and fix problems before they happen. Smart shelves in retail stores can automatically place orders when inventory gets low.”
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- 4. Blockchain Integration: Integrating blockchain technology with ERP systems enhances data security by providing a transparent and immutable ledger. This is particularly valuable for tracking supply chain transactions, ensuring product authenticity, and reducing the risk of fraud and data breaches.
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- 5. Mobile ERP: Mobile ERP applications provide on-the-go access to crucial data, enabling users to access real-time information, approve workflows, and make decisions from their smartphones or tablets. This flexibility enhances productivity and reduces response times.
Says SAP: “Mobile ERP is nothing new – it’s been around for decades. However, it’s evolving from basic apps into smart, multi-device experiences. With this more advanced form of mobile ERP, a user’s tasks and to-do’s follow them across all the devices they use as they go about their day: a laptop, desktop, mobile phone, smart home speaker, smartwatch, smart TV, or almost anything else that can connect to the Internet. And the system knows where they left off, so the experience is seamless.”
- 6. Predictive Analytics/More Powerful Analytics: Predictive analytics tools within ERP systems leverage historical and real-time data to forecast market trends and demand patterns. This enables businesses to make proactive decisions, such as optimizing inventory management and adjusting pricing strategies. When combined with additional technologies such as Artificial Intelligence and Machine Learning, the accuracy and benefit of Predictive Analytics become significant.
- 7. Voice Commands and Virtual Assistants: ERP systems equipped with voice recognition technology simplify data access and input. Users can interact with the system using natural language, enhancing the user experience, and allowing for hands-free operation, particularly useful in manufacturing and logistics environments.
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- 8. Composable ERP: What makes ERP composable? Various elements of the software suites are assembled as needed to meet new opportunities, challenges, and obstacles.
Says SAP: “A better term for this is probably “re-composable business” – for the ability to re-compose a business as conditions change. For example, if demand is spiking in a certain country, and customers are wanting more of product A than product B, composable ERP makes it possible to rapidly source and buy more of the necessary materials, redirect workloads, move workforces, build more of the in-demand product, and ship it where it needs to go.”
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- 9. Industry-Specific Solutions: ERP vendors are developing industry-specific modules and features that cater to the unique requirements of various sectors. For example, healthcare ERP solutions offer patient data integration and compliance with health regulations, while retail-focused ERPs include inventory management and point-of-sale features.
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- 10. Hybrid ERP/Two-Tier ERP: Hybrid ERP solutions combine the benefits of both on-premises and cloud-based ERP systems. This flexibility allows businesses to leverage cloud advantages for scalability and remote access while maintaining on-site control for sensitive data and applications.
Says Oracle: “Two-tier ERP is a strategy that enables organizations to leverage their investment in existing ERP systems at the corporate level (tier 1), while subsidiaries and divisions operate using a different ERP solution (tier 2), which is often cloud-based.”
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- 11. Robotic Process Automation (RPA)/Hyper Automation: RPA technology, when integrated with ERP systems, automates repetitive and rule-based tasks such as invoice processing, order entry, and data extraction. This not only reduces human errors but also frees up employees to focus on more strategic and creative tasks.
Says SAP: “In addition to new automations, companies can improve previously automated processes in their ERP systems – gaining speed and new efficiencies from one end of the business to the other. With increased and more advanced automations, companies are also better able to handle talent scarcity – freeing up available staff and resources to focus on more value-added activities.”
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- 12. Cybersecurity Enhancements: ERP systems are increasingly focusing on cybersecurity to protect sensitive data. This includes features like multi-factor authentication, encryption, and real-time threat monitoring, which are crucial for safeguarding against data breaches and unauthorized access.
- 13. Data Analytics Platforms: Modern ERP systems are evolving into comprehensive analytics platforms that provide advanced data visualization, self-service reporting, and powerful business intelligence capabilities. Users can create custom dashboards and conduct deep data analysis to make informed decisions.
- 14. Sustainability Integration: ERP solutions include modules that help businesses track and reduce their environmental footprint. These modules offer tools for measuring and improving energy efficiency, reducing waste, and ensuring compliance with environmental regulations.
Says SAP: “Governments are starting to mandate more sustainable operations; customers are demanding them too – and it’s just the right thing to do.”
- 15. Supply Chain Resilience: ERP systems are enhancing supply chain visibility and resilience. With real-time tracking and predictive analytics, businesses can adapt to disruptions, optimize logistics, and ensure continuity in their supply chain operations.
- 16. Smart Manufacturing: ERP solutions lie at the core of smart manufacturing initiatives. They enable real-time monitoring of equipment performance, predictive maintenance, and process automation. By connecting ERP to Industrial Internet of Things (IIoT) devices, businesses can achieve greater efficiency and reduced downtime.
- 17. Augmented Reality (AR): AR features within ERP systems enable maintenance and training in manufacturing and field service. Technicians can access digital overlays of technical documents and schematics, making troubleshooting and maintenance more efficient.
- 18. Customer-Centric ERP/Personalization: Businesses are using ERP systems to gather and analyze customer data, including preferences, purchasing history, and feedback. This data facilitates more personalized service, product recommendations, and targeted marketing strategies.
Says Oracle: “As companies focus on delivering more personalized, relevant experiences to customers, they need ERP systems that can accommodate those needs with features like highly customizable dashboards.”
- 19. Low-Code and No-Code Development: Low-code and no-code development platforms simplify the customization and integration of ERP systems. This allows businesses to adapt their ERP solutions to evolving needs and industry-specific requirements without extensive coding or development resources.
- 20. Data Security Regulations Compliance: ERP vendors are ensuring that their systems comply with evolving data security regulations, such as the EU's General Data Protection Regulation (GDPR) or the California Consumer Privacy Act (CCPA), to protect sensitive data and maintain legal compliance.
- 21. Employee Experience Enhancement: ERP systems are investing in user-friendly interfaces and improved navigation to enhance the overall user experience. This includes features like personalized dashboards, simplified workflows, and intuitive designs.
- 22. Scalability and Flexibility: Modern ERP systems are highly scalable, allowing businesses to adjust to changes in size, organizational structure, and business needs. This scalability is critical for accommodating growth and diversification.
- 23. Cognitive ERP: Cognitive computing features enhance decision-making by providing insights and suggestions based on historical data and real-time information. Cognitive ERP systems assist users in identifying patterns, predicting future trends, and optimizing business processes.
- 24. Human Resources Transformation: HR modules within ERP systems, as well as stand-alone HRIS solutions, are expanding to include features such as employee engagement, wellness programs, and talent management. These enhancements support HR teams in attracting, retaining, and developing top talent.
- 25. Remote Work Support: ERP systems are incorporating tools and features to support remote work environments. This includes HR functionalities for remote employee onboarding, collaboration tools for virtual teams, and secure remote access to critical business data.
We would welcome your comments and input on these 2024 ERP trends and innovations and would welcome a discussion to share how adopting some of these trends may help your business.