4 Common Challenges of ERP Integration and How to Overcome Them

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Companies typically employ ERP systems to automate specific business functions and also improve visibility into those functions, boosting operational efficiency for the organization as a whole. But in order to maximize efficiency gains and other benefits, any ERP system a business chooses to use must be well-integrated with other enterprise systems. Connecting these discrete software systems improves data quality and visibility, streamlines workflows, and facilitates better collaboration across the entire company.

It’s impossible to argue with the many advantages that ERP integration offers. However, the fact also remains that integrating ERP solutions with other software is a highly complex process, with attendant risks and challenges. Working with highly agile, configurable solutions such as SAP Business. One can help ease the process significantly, but it’s also important to support state-of-the-art software with a comprehensive, well-considered integration strategy. In many cases, proper planning can spell the difference between a smooth, painless ERP integration process and one fraught with costly errors and delays.

Here are four commonplace challenges to anticipate during ERP integration, and how businesses can overcome them:

Heightened Security Risks

Software integration is a highly complex endeavor, involving a wide array of programs, processes, and personnel. The very complexity of most integration projects makes companies highly vulnerable to various security risks. For example, system administrators may mistakenly provide the wrong users with unauthorized access to sensitive data. IT personnel may mishandle company information during the integration due to simple human error. The worst-case scenario is those external bad actors may gain unauthorized access to company systems, causing data leaks or even full-scale breaches.

Major security incidents such as companywide data breaches can cost businesses thousands of dollars and deal lasting reputational damage. Thus, companies need to have airtight security measures in place to protect their systems and data when performing complex projects such as software integration. At the minimum, this involves ensuring that all enterprise systems to be integrated have up-to-date cybersecurity capabilities. IT teams and other involved staff must also be periodically trained in current cybersecurity best practices.

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Data Compatibility Issues

Ensuring data compatibility across all enterprise systems is one of the biggest challenges companies face during software integration initiatives. In essence, data compatibility is the ability of discrete software systems to share information and subsequently interpret it correctly, without inconsistencies, losses, and other errors. Data compatibility depends on the alignment of multiple factors across a company’s systems, including data rules, definitions, standards, formats, and quality. Failure to align these factors properly can give rise to problems such as data loss, mismatch, corruption, or duplication.

Because data compatibility is such a must for successful software integration, it must be treated as a major priority during an organization’s pre-integration preparations. Companies must conduct comprehensive data mapping and analyses before integration begins. It’s also in their best interest to set up clear policies and procedures on data quality and governance if they don’t already have these in place.

Suboptimal Business Processes

Companies running unintegrated ERP solutions often employ manual business processes to support related workflows. Depending on manual labor, however, increases the risk of processing delays, human error, and chargebacks—all of which can drain company time and resources significantly. One of the major goals of ERP integration is often to eliminate this dependence on manual tasks and accelerate end-to-end workflows through companywide process automation.

Well-designed business processes can create immense value and positive outcomes for a company’s customers and stakeholders. In contrast, suboptimal processes lead to compromised productivity, increased waste, conflict, confusion, and customer dissatisfaction. Companies must thus analyze their business processes thoroughly before pursuing a major software integration process so that it can better understand what processes are functioning optimally and which ones may need to be redesigned. When implementing new processes, they must also be sure to conduct change management and training initiatives with all relevant stakeholders and personnel.

Antiquated Legacy Technology

Legacy systems can also throw a wrench into ERP integration efforts, particularly for older businesses that have been operating for many years. Many of these businesses employ the same antiquated software systems that they’ve used since the company’s inception, or at least for so many years that current personnel no longer know or remember any alternatives. More risk-averse companies will also be reluctant to change these systems, even if more modern alternatives seem to promise greater productivity gains.

If a company is disinclined to pursue a full system overhaul, augmenting legacy technology with newer applications can help improve its functionality. However, since these systems are not up-to-date and have probably long lost their developer support, connecting them with more modern programs can be challenging for developers. This necessitates hiring a well-rounded IT team with a diverse skillset, as businesses will need people who know how to work both with contemporary APIs and older source code. For companies that can’t hire people with the skills and knowledge necessary, third-party integration tools and platforms may make a worthwhile investment.

Although ERP integration undoubtedly comes with many complexities, the rewards it offers are well worth the challenge of navigating a concerted integration effort. When approached with due preparation, ERP integration can strengthen a company’s technological infrastructure by leaps and bounds.

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Roy M is a technical content writer for the last 8 years with vast knowledge in digital marketing, wireframe and graphics designing.

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