Risk Involved Using a Legacy System
The ever-changing technological environment calls for organizations to be always ready to embrace change in ERP systems whenever a better technology is introduced to reap its benefits. The absence of this flexibility in your ERP software leads to failure to adopt these technologies, risking your business to become less productive and eventually uncompetitive.
Here are the major risks involved with the continued use of a legacy system:
Failing to adapt to new industry trends
Legacy ERP system does not include appropriate technologies or tools to handle modern business requirements. It could even create lots of confusion and workarounds.
The features of the latest ERP software and the simplicity of using the system make it possible for you to enter, access, and share all business information in just a few clicks from any web browser with the right permissions. It is faster and flexible in adopting newer technologies, scalable to support business growth, and offers better data security. All these crucial features are lacking in the legacy ERP system, and so it needs to be immediately replaced with a newer business solution.
Higher system maintenance costs
If you are looking to cut down business costs, keeping a legacy system up would not help. It would actually make you bear more expenses to maintain and keep the system running. The primary reason behind this is that legacy systems use a stack of different subsystems and outdated tools with higher maintenance costs.
When you shift to the latest ERP system, it supports new IT initiatives and innovation. You get a centralized database for your entire business that reduces overall IT costs while enabling you to gain better control over operations.
Poor focus on customer experiences
In today’s fast-changing market demands, focusing on establishing customer relationships by improving their experience has become more critical than ever for businesses to sustain and grow. Identifying and keeping track of their needs to provide the best customer service would automatically give your business a competitive edge.
A legacy ERP system does not have the capabilities or infrastructure to collect, share, and act on real-time customer data. Therefore, it would not be able to help your company to offer customer-centred services. The data in the system is fragmented, with each department having its own set of information. This creates a disconnection and difficulty in information sharing. As a result, your customer service teams would not always have up-to-date information to deliver their duties competently, leading to poor customer experiences.
Missing out on opportunities
Every organization has workflows that correspond with how technology is used. A legacy system derails them and causes operational inefficiencies.
Your current ERP system may apparently do its intended job, but since it lacks appropriate technologies, there is always a chance that you miss growth opportunities. This mainly occurs with an on-premise ERP system. Because it is not on the cloud, all its operations are not adequately streamlined. Finding and accessing information is challenging, which threatens the overall business productivity.
On the contrary, a modern cloud-based ERP solution lets you automate, scale, and respond quickly to ever-changing market demands. It offers you reasonable chances to boost business growth.
When to Replace Your Legacy ERP Software?
ERP implementation is a complicated process and takes time to understand and accept. Nobody likes dealing with this crisis, but if your ERP cannot match your business requirements with changing times, it is not doing what it is meant for. So instead of fighting the inevitable, take a hard look at your software and look for signs telling it is the time to make the switch.
Your ERP is not scalable
When your business expands, your operations grow. You need a scalable ERP that could be upgraded to accommodate increased data and users due to the business expansion and establish efficient workflows across all departments.
You unable to meet compliances
Staying compliant with the latest government regulations is necessary. Right ERP makes the process easier. It allows you to accurately track and document the regulatory instructions as soon as they occur, enabling you always to stay compliant with them.
Absence of analytical capabilities
ERP system stores all your business data and uses them to improve performance. This is possible when it is embedded with data analytics tools. The system could analyse historical data and present it in systematic and understandable graphical formats for easy forecasting.
You do not have a tax-ready system
Regional sales tax laws are applicable in almost everything related to finance and accounting, such as billing, invoices, payments, refunds, registrations, etc. A tax-ready ERP automates tax calculation and eliminates audit risks while providing end-to-end tax management.
Finding the Right ERP Solution?
Your legacy ERP system might serve your business needs fairly well for now. But continuing with it could lead to potential business problems in the near future.
If you’re unsure about what migrating from legacy software to a modern ERP system would look like and the consequences involved, we are here to help you choose the right business solution and make the transition as seamless as possible.
Focus Softnet is a trusted ERP software provider. We have helped companies like yours navigate advanced business solutions with ease.
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