This is an issue because ERP touches nearly everything in the enterprise. Ideally it should be able to exchange data and interoperate with every other program in the company. That’s a wonderful idea, but the practice falls far short. There are a number of important barriers to ERP integration and achieving the maximum integration requires forethought and careful selection of the ERP system and the applications to be integrated.
In general, ERP vendors offer modules and related applications that can interoperate with their ERP products, but beyond the vendor’s own offerings, all bets are off.
The result is that most companies that need to integrate their ERP systems with other applications end up having to use custom interfaces – often written specifically for that installation.
Unlike a lot of problems with ERP, this one isn’t getting better. In fact it’s getting worse. As vendors rely more heavily on middleware to knit together their ERP offerings, more constraints are imposed on users’ integration choices.
One of the central problems in ERP integration is data exchange. The ERP system needs to be able to read and write data to other applications the company uses. A few products offer the ability to automatically reformat data so it is compatible with other systems. Most of the time it requires a separate application to do the conversion. If you’re lucky there is a product available which can do the reformatting out of the box. Most of the time it requires configuring or customizing the product, or writing a new application.
Diverse architectures is another problem for ERP integration. Except for products from the same vendor, the design of the ERP system and the other key applications are very different and even when the data is in a compatible format it is hard to get the products to talk to each other effectively. Again, the answer is typically customization or writing an application to handle the interface.
Given the amount of work involved in integration, it’s not uncommon for a company to integrate ERP into the company system at a few critical touch points, such as general ledger and CRM and leave the rest of the functions unintegrated.
Another problem with ERP integration is updating the system. It is not uncommon for the latest version of an application or ERP to break the integration so painfully established. This means more modifications and custom programming to keep things working.
The time to start thinking about integrating ERP into your IT process is when you start thinking about installing the ERP system. It’s important to include ease of integration as one of the selection criteria when choosing an ERP system. This requires knowing which applications you want your new ERP system to integrate with and what data formats will be necessary for interoperability. Often you will find that the ERP vendors have considered interoperability and made provisions to integrate their products with popular application packages. This can range from built-in conversion modules to providing APIs to make it easier for you to roll your own.
You may also find third-party applications that were written to integrate your ERP package with your other applications. Whether with software from your ERP vendor or a third party, it’s important to test in your environment and make sure the integration actually works as advertised.
It’s also important to integrate these packages into your test environment as you proceed to install the ERP system. They need to be thoroughly tested just like the modules native to the ERP system.
By Rick Cook