Time eventually makes all software obsolete, and organizational growth only accelerates the process. Here we list the tell-tale signs that your enterprise software could be nearing the end of its useful life and may need replacing.

Manual processes

  • Too many spreadsheets. Possibly the most obvious indicator that software is not meeting the needs is when there are hundreds of spreadsheets (and Access databases) being used in the normal course of business. Functionality missing from the core software is being worked around with manual processes and spreadsheets that take time and introduce errors. While spreadsheets will always be used, when there are too many this suggests the core enterprise software is not properly meeting the organization’s functional needs.

  • Inadequate reporting. Closely related to the spreadsheet problem above are inadequate reports. Every month, quarter etc. multiple management reports are built and updated using spreadsheets. Data collection from disparate systems is largely manual, and if there is a need to drill down and examine certain numbers more closely, new spreadsheets must be created which is slow and error prone. While there are some excellent 3rd party tools available that can improve reporting, this is a temporary band-aid that only postpones the inevitable.

  • Constant fire fighting. Management is so busy fighting fires they have no time to call the fire department. They are forced to work in the business and don’t have time to work on the business. A large part of this is caused by management not getting the right information fast enough or even at all, and that is due to inadequate systems.

  • Slow financial close. Financial close processes are too manual, and it takes too long to close the books every month.

  • Limited functionality. Modern systems can do in minutes what takes hours or days in your current system. Because it is so difficult to do this work, it is not done properly or is even skipped entirely.

Information silos

  • Mergers & acquisitions. The company was built over the years by mergers and acquisitions and uses multiple ERP systems at different locations. Each is in their own silo. Consolidated reporting is very difficult and it usually takes a long time to close the books every month. This is very common with private equity portfolio companies in the mid market where the strategy is to create larger companies through M&A.

  • Multiple software purchases. A company has purchased many enterprise software products over the years as they have grown, and each of these operates independently and has it’s own silo of information. This is very similar to the merger and acquisition problem above.

  • Silo integration. Where information is moved automatically from one system to another, the maintenance of those interfaces is constant, ongoing and expensive. Every time something breaks in one system, that problem ripples through other systems causing disruptions.

Other signs

  • Security. Data breach risks are a concern for your organization. Cloud security is going to be far better than security your organization can provide, demonstrated by the fact that companies like Equifax, JP Morgan Chase, Home Depot, Target, Sony etc. could not prevent data breaches. Realistically, what is the risk of a breach occurring at your company? The enhanced security of the cloud can be a reason for migrating from a system in the data center to systems designed for the cloud.

  • Business strategy support. The business strategy calls for functionality that current software does not deliver, and that lack of functionality prevents part of the business strategy from being executed.

  • Old software. The currently used enterprise software or ERP systems are over 10 years old. While the existing system may be current in terms of versions, generally modern software is easier to use and does a lot more. Competitors that have appeared in the market since the original system was bought may provide substantially greater value in supporting the business strategy than the existing system.

  • Old operating systems. The system may be running on operating systems that are about to reach the end of maintenance support, after which the system may no longer be compliant. Replacing the operating system is a significant project that entails risk to the applications on those servers. Note that this problem also applies to virtualized servers.

  • Recruitment costs. It is difficult to recruit people with experience in your current system. When you do find a candidate with the necessary experience, they can demand higher pay. When you can’t locate candidates with the desired experience it means increased on-boarding and training costs.

  • Vendor milking software revenues. Apart from security and other patches, the vendor does very little development work on the software. This shows up as an anemic rate of releasing new features for the software. Under these circumstances the vendor maintains high licence & support costs but slashes software development. You can be sure the vendor is over charging in terms of value delivered, and they are counting on inertia preventing most customers from migrating to competing software. Even if the software is adequate today, if your business needs are expanding it is just a matter of time before you outgrow it.

  • Orphaned software. The software was originally purchased for a particular set of functionality, but the vendor has since taken development in a direction that is of little interest to you.

  • Quality problems. When functionality is missing from core systems, the work gets done manually. Error rates are too high, mistakes are made, and there are quality problems with corporate data.

If you see a number of these tell-tale signs in your organization this may suggest that new software or ERP might be worth considering. To discuss a potential software selection project, click the [Contact Wayferry] button below. We can help you determine the value of the project to your organization and explore how the new software can support your business strategy.