Technology positively or negatively disrupts. New innovations have been constantly springing up, upending the old order. New companies sprout from where others have been rendered outdated. However, when existing companies learn to be agile and adapt to changing business environment, they leverage technology to grow even stronger.

Over the recent past companies have rushed to digitise their operations to either remain relevant, stay afloat, cut costs or expand. One of the innovations that enterprises are increasingly finding it indispensable is the Enterprise Resource Planning (ERP) software whose global market size is expected to hit Sh7 trillion by 2026.

Adoption of ERPs, a new report says, is already an integral part of companies keen to be more efficient, make their operations resilient and remain competitive. The adoption of digital operations, the survey says, has been speeded up by the Covid-19 disruptions.

The report by Market Research Future  says measures such as lockdown and physical distancing, put in place to curb the spread of the deadly Covid-19 compelled many firms to quickly move to digitise their business processes, including supply chain product management, sales, marketing, accounting and finance, and human resource. 

“Covid-19 pandemic has positively impacted the ERP software market, fostering digitisation and automation across the manufacturing sectors globally,” the research says.

Firms will certainly reap the benefits of deploying cutting-edge technologies such as ERPs. The Market Research Future survey indicates that companies, big and small, are deploying ERPs to manage their business more efficiently while stepping up  productivity and simplifying compliance and risk management.

Experts warn that businesses that ignore these innovations are bound to encounter a rough ride going forward.

Doug Hunter, customer and ecosystem enablement manager at ERP software company Syspro, says firms that fail to digitise are setting themselves up for costly operations which could render them uncompetitive or entirely obsolete.

“ERP has been reinforced as a must for manufacturers” he notes, adding that “It is the basis on which they streamline processes through automation, using and providing accurate real-time information, and reducing costs.”

The new report points to the many gains from adoption of technology: “ERPs are being adopted to effectively plan and streamline data under one platform, regulating operating costs, improving decision-making and increasing sales.”

ERPs are also central in management of logistics as it helps in curbing pilferage of raw material, auto-replenishment of critical stocks, planning, production and procurement . This means the needs of customers are satisfactorily met, while ensuring that the firm does not get stuck with stocks that may not be needed at the moment.

Given their potential to revolutionise enterprises, The ERP market is expected to grow taking into account the amount of investments it is attracting, geared towards research and development activities and helping developers make digital-based recording solutions. 

The reasons for the rising demand for ERPs are clear to see. The software  are designed for the most essential business processes within any enterprise, from  procurement, production planning, sales, human resources, accounting, and supply chain management. This explains why firms find ERPs the go to software in the face of the disruptive Covid-19 pandemic.

Many SMEs that relied on basic software to run processes realised that operations involve critical data points that come in large volumes, prompting an urgent need to automate their operations for accuracy, production speed and consumer satisfaction in business operations.

Mr Hunter says companies have to clearly see their progress to enable faster agility while riding on operational and labour efficiencies.

He says with the advent of 5G in Kenya, ERPs will even bring more gains for businesses.  

“IoT gathers real-time data from a range of smart devices across supply chains covering production counts, quality, safety, product and process innovation and more. With monitoring technology IoT can track machines, equipment and device performance before failure,” says Mr Hunter.

The next-generation ERP systems have powerful Business Intelligence (BI) and Analytics tools built-in which enable the management of an enterprise to quickly analyse the current market and operational situation and take well informed decisions to offset any adverse eventualities or to plan business growth and diversification in a structured manner.

Mala Bhatt, Bluekey Seidor managing director, says the current market dynamics requires businesses not only to install systems that automate and integrate operations, but also incorporate machine learning and advanced analytics. Such a software, technically known as intelligent ERP (iERP), enables firms to forecast, track, learn, predict, report and manage company operations.

Bluekey Seidor, which has been operating in Kenya for 17 years, has installed systems which have largely seen SMEs transform from manual operations to integrating different aspects of business such as procurement, market and sales into a single database.

“There’s tremendous innovation in the industry and so we are looking at things like artificial intelligence, machine learning and internet of things being integrated into ERPs. We want to be the pioneers in this field,” Ms Bhatt stated.

“10 years ago, it was just an accounting software and people were just starting to move to ERP. Now, we are seeing that ERP is well-established and we need to move to the next phase which is intelligent ERP that encompasses many dynamics.”

Cloud computing, cloud-based applications, and software as a service (SaaS) or on-demand are key market trends that are positively impacting the ERP market size, says the report.

“These advantages are estimated to fuel demand for cloud and mobile apps in the years to come. Cloud computing enables enterprises to store and access data via the Internet with scalability, agility, reliability, and flexibility. Simultaneously, service models of cloud computing, such as SaaS or software on-demand, reduce the company’s IT infrastructure costs,” notes the research.

The proliferation of mobile devices in the working culture, the research found out, is encouraging businesses to invest in cloud-based connected infrastructure, allowing access to information anytime and anywhere.

Chief Technology Officer at Unit4 Claus Jaspen says thethe balance between selling software and services will change for vendors, at least those selling vertical solutions and templated implementation models.

“Overall, ERP is set to evolve and change to fit the needs of users and their business goals. Tech leaders should keep an eye out for these trends as we continue to experience seismic shifts in the market,” he states.

For manufacturers, Mr Hunter notes that they need the latest release of ERP software to monitor costs across the business so issues can be identified as they occur, such as variations between expected and actual raw material and production costs, obsolete, slow-moving, excessive inventories, product defects and scrap.

“The digitisation of design, production, delivery, sales and services, as well as integrating partners and other systems that are part of the supply chain, will improve collaboration, planning and execution across an extended value chain,” he says.

He adds that an e-commerce portal should integrate to ERP systems with inventory levels updated in real-time, and show inventory information by warehouse location for more delivery precision.

Calling on African enterprises to embrace the use of ERPs and vendors to create additional layers of cyber security, Mr Hunter predicts that most technology jobs and opportunities will be in Africa in coming decades.

“Africa will generate the highest GDP in future. There will be more tech jobs in manufacturing, that’s why African youth should be skilled in machine learning and all forms of AI.”


editor