The future of work and the workforce are shifting. More and more employees are becoming frustrated with outdated technology, feeling that it holds them back from focusing on higher-value tasks and progressing in their careers. Accordingly, business leaders – and specifically c-suite executives – need to reimagine their workforce strategy.
The concept of ‘technical debt’ is a result of shortcuts and quick fixes at the expense of investing in a long-term viable technology solution. This means that working with outdated technology prevents key visibility into the health of a business. What happened in December 2022 to Southwest Airlines offers a compelling example. The combination of peak holiday travel and fierce winter weather exposed just how vulnerable its system really was, leading to more than $1bn in lost revenue from refunds and canceled flights.
C-suites must reflect on a critical question in today’s business environment: How are you planning and budgeting to update technology in order to avoid negatively impacting customers or employees while retaining both?
As digital investments and budgets meet at the crossroads of economic realities and employee productivity, I believe there are three key trends in enterprise resource planning that merit the attention of senior executives. These include investing in ERP projects linked to workforce strategy, embracing templated models rather than mass customizations and utilizing AI to support business growth.
ERP projects linked to C-suite workforce strategy
Keeping employees busy during an economic downturn is a key concern for clients of my company – a national accounting, technology and consulting firm. Many of these clients are focused on building their businesses for the future while preparing for the next busy season and eventual upturn.
Rather than laying off employees, they are reshuffling work or filling the capacity of team members with open bandwidth by redirecting them to digital transformation initiatives. Undertaking an ERP project during a slowdown can be a good way to keep your team engaged, while offering many additional benefits, especially for the long-term success of your business.
An opportunity for automation exists if a company currently has employees performing repeatable tasks like collections, reconciling bank accounts or invoice entry and payments. This can not only save time and money, but also enable those employees to focus more on long-term strategy, potentially building relationships with vendors and customers.
In the current low-unemployment environment, characterized by high turnover as employees feel emboldened to explore other opportunities, companies could find that automation also means they don’t need to replace staffers who decide to leave. In other cases, automation might lead to evaluating what else a current employee can do to benefit the company and advance their career, perhaps involving data analysis or upskilling.
Embracing templated models rather than mass customizations
As ERP solutions mature, many clients recognize that the benefits of customizing a solution to their current business processes don’t necessarily outweigh the costs of maintaining that solution in the long run. With more cloud-based alternatives offering evergreen updates, the less customized an ERP system is, the easier it is to upgrade and equip it with new functionality.
Digital transformation offers an opportunity to reconsider business processes. How do you handle procure to pay, order to cash or manufacturing? Some cloud ERP solutions allow companies to enjoy quicker speed to deployment while reducing the total cost of ownership for the technology.
Conversely, when clients essentially recreate their bad habits from the old system into a new one or customize for the sake of customization (or to appease users who refuse to change), it can often lead to higher maintenance costs, partly because of the need to hire people who understand that specific technology.
For clients that embrace more standardized solutions and limit customizations, the savings can be realized not just on the technology side but in how business processes are conducted. For example, this could entail centralizing certain functions versus having multiple sites or facilities perform them.
Utilization of AI to support business growth
Finally, ERP solutions can support businesses as they move from descriptive analytics (looking at past events and operating in a reactive mode) to predictive analytics (proactively forecasting future outcomes) – with AI playing a key role in strategy and objectives as companies undergo changes related to data, processes and workflow.
Data-driven competitive advantages stem from effectively utilizing applications, robotic process automation, ML, predictive modeling and using AI in ways that directly and positively impact the customer and employee journey.
Utilizing integrated ERP solutions provides a great way to evaluate data and enable a better understanding of customer habits. For example, based on credit limits, who might be at a higher risk for not paying invoices on time? With this knowledge, you could reach out to clients in advance and try to build greater rapport with them, or even start to collect faster or negotiate terms in order to ensure they don’t become delinquent.
AI data can also provide an opportunity to assess inventory levels and determine how and from where you need to ship goods in order to get them to customers faster. Such predictive analytics help businesses prepare much quicker for complex and changing times.
Understanding the investment
For C-suite executives who haven’t yet invested in a new ERP solution, relevant questions to consider include, ‘Are you able to predict what is likely to happen with your business?’ and ‘Do you have sufficient data at your fingertips and real-time visibility into company operations?’
If not, it would make sense to assess your tech stack and consider potential improvements – not just what could be done in the next few weeks or months, but what a multiple-year investment might accomplish and how that road map might look.
At the end of the day, the C-suite works as a team to provide pivotal direction for company growth. Accordingly, I think it’s important for these decision makers to think of themselves as visionary, forward-looking and strategic leaders. You should be highly focused on addressing tangible ways to advance the long-term goals of a company.
I would also emphasize the importance of being unafraid to invest in technology, which doesn’t have to be scary or as costly as it has been in the past. In fact, I believe it’s very achievable for the average person to become more tech-savvy. From personal experience, I’ve seen many inspiring examples of clients transforming from a sense of uncertainty and fear about new technology to feeling empowered by it.
