ERP Value

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THE BUSINESS VALUE OF

NEXT-GENERATION ERP

Perspectives for Financial Management

March 2010

Introduction written by Martin Butler, Founder and Chairman, Martin Butler Research

Industry Perspective written by Matt Muldoon, Senior Director – Product Marketing, Epicor Software

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© Martin Butler Research 2010

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The Business Value of Next-Generation ERP: Perspectives for Financial Management 3

Management Summary

Enterprise Resource Planning (ERP) has become a key tool for managers as they struggle to deal

with increasing complexity and change. While ‘resource planning’ is certainly part of the

capability most ERP suites offer, it is no longer the most important part. The first generation of

ERP solutions focused on resource management - the next generation adds a set of capabilities so

that managers can deal with accelerating change and greater complexity. An advanced ERP

system provides an integrated view of the operations within an organisation, and for finance

management it provides the only means of dealing with the complexities of modern company life.

Multi national, multi company operations, increasing regulation, multi currency transactions,

fraud and financial audit, variations in tax laws and many other issues only serve to make the job

of financial risk management and reporting ever more complex. A capable ERP application allows

managers to deal with these issues in an efficient manner.

Next-generation ERP solutions bear very little resemblance to the products

that were hurriedly implemented to meet the Y2K deadline. Ten years ago

ERP applications tended to be cumbersome and rigid, imposing constraints

that many managers found counter-productive. Today the leading ERP

suites are flexible, open, cost-effective and provide the only mechanism for

handling the complexities of modern company structures.

ERP has become much more than a suite of applications to handle core

transactional processing. Process management, performance management,

activity monitoring and business intelligence are offered in varying degrees by most ERP

suppliers. The emphasis is changing from operational efficiency, to management effectiveness.

While no one would argue that operational efficiency is not a prerequisite for organisational

success, it is a necessary, but hardly sufficient condition. Management effectiveness means

having accurate, timely information so that decision making is speedy and effective. A modern,

effective ERP system is the single most important component in the never-ending challenge to

become more responsive and flexible.

Organisations vary in their degree of sophistication. Some might still use stove piped applications

in finance, customer management, production and other areas of activity. Others will be familiar

with the integrated view an ERP system can deliver, but be locked into a constrained, inflexible

set of processes. The next generation of ERP applications provide financial management with the

tools to realise levels of complexity management, flexibility, efficiency and control that simply

would not have been possible even five years ago.

Hard-earned experience shows us that technology is only a small part of the picture. Many other

issues such as change management, information structures, training, ROI management and

measurement, and organisation-wide commitment, affect the outcome of an ERP investment.

The benefits can be transformational, both in terms of productivity and management

effectiveness.

A modern, effective ERP

system is the single most

important component in the

never ending challenge to

become more responsive

and flexible.

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Fraud and Financial Audit

The burden on most organisations to meet increasing financial and fraud audit requirements can

be debilitating. The cost of meeting these requirements can, and often does, have a noticeable

effect on the bottom line. Perhaps more importantly however is the fact that financial

management is often consumed for long periods of time in efforts to find, compile and report on

the information needed by various regulators and auditors. Sarbanes-Oxley, BASEL II and carbon

accounting are just a few of the better known compliance requirements placed on many

organisations – and we can expect more.

An ERP suite can streamline the audit process considerably provided it offers the tools to do the

job. Since audit is primarily concerned with information search, the ERP systems should be easy

to use, and offer ‘search from anywhere’ functionality. Difficult procedures and arcane interfaces

extend both the time and cost of the audit process.

Most auditors will be keen to understand who has access to what information in an ERP system

and how such access is granted (and revoked). Security is a major issue when selecting an ERP

suite, and a supplier should demonstrate knowledge and experience of

addressing audit related security issues. There are many well-documented

cases of financial managers being over confident of ERP security and falling

foul of the audit process.

The International Accounting Standards Board (IASC) has developed the

IFRS taxonomy to ease the exchange of financial data using XBRL

(eXtensible Business Reporting Language). With the two pillars of expertise,

technology and financial reporting, the IFRS Taxonomy aims to standardise

and simplify due process. Clearly it is desirable if the financial functions

within an ERP application can be configured to support these

requirements, and some of the more contemporary products do indeed

help with these issues.

In many ways, the facilities provided by an ERP system to financial managers is just half the story.

How those facilities are used and structured is perhaps even more important and input from a

ERP supplier on account code structures and how multi national, multi company structures are

best handled is crucial. Flexibility is the keyword here since major events such as acquisitions,

migration into new territories and the development of new products and services cannot always

be predicted. If the ERP suite provides the necessary functionality and information is structured in

a flexible manner the audit overhead can be reduced significantly.

Complex Financial Structures

The financial structures in even modest sized organisations tend to become more and more

complex. This is a direct result of multi company, multi national operations where tax rules, audit

processes and accounting standards vary. Without the necessary functionality an ERP system will

actually inhibit effective treatment of these complexities, causing financial management to use

There are many well-

documented cases of

financial managers being

over confident of ERP

security and falling foul of

the audit process.

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other tools (e.g. spreadsheets) that are not integrated with core systems, leading to duplication

and errors. Auditors tend to rub their hands in glee when financial management starts talking

about off-system transactions and the use of peripheral tools such as spreadsheets. Having an

ERP suite that delivers flexibility is very important, and contrasts with the fact that many ERP

solutions have imposed rigid, inflexible structures on financial management leaving them with no

choice but to use off-system tools.

The most advanced ERP solutions offer configurable rules bases that allow financial managers to

specify how data and processes should be handled in multi currency, multi company situations.

Some of these issues can be very complex – just addressing currency rounding issues involves

very advanced processing if it is to be handled effectively.

Financial Integration

A fully integrated ERP system will reach into all areas of an organisation’s operations, providing

financial management with an integrated, detailed view of performance. Individuals within the

enterprise, at many levels, need to know how they are impacting on the financial metrics that

have been put in place to measure performance. They also need to understand the dependencies

that exist between various operational areas and this is only possible with a fully integrated ERP

application suite. The information needs to be current, accurate and easily available, and this has

certainly not been the case with many ERP solutions. Next generation ERP is effectively real-time

with easy access to crucial information.

Performance Management

The integration that has been enabled through ERP provides a solid foundation for performance

management. This has not always been the case. The need to measure financial performance and

other key performance indicators (KPI) has always been with us and various attempts have failed

because of the lack of process and data integration behind the attractive, but largely useless

graphical indicators that management have attempted to use to quickly identify problem areas.

New generation ERP applications not only provide the necessary process and data integration but

they also provide the tools to aggregate and summarize data so that it can be presented using

dashboards and other tools associated with enterprise performance management (EPM). This is

quite different to the top heavy, inaccessible business intelligence systems that have been used

with varying degrees of success to identify performance problems and identify opportunities.New generation ERP provides management with the tools to get at much of this information

themselves without recourse to technical specialists or expensive infrastructure.

The main advantage of this new level of capability is management by exception, instead of the

need to monitor possibly dozens of variables. Key metrics such as days sales outstanding are

easily monitored using EPM capabilities when the ERP system provides the necessary tools.

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Managing and monitoring change

While we often talk glibly about globalisation, the realities are often extremely complex and

require very sophisticated systems to manage a large number of variables. Tax laws, multi

currency and multi company requirements and the ever growing need to comply with various

regulations can only be handled by very sophisticated ERP applications. Ultimately of course this

complexity must be broken down and presented in a simple, manageable format. Very few ERP

suites handle this level of complexity with ease, although a new generation of ERP suppliers have

risen to the challenge and provide the necessary tools to manage almost any level of complexity.

Mergers and acquisitions and moves into new territories create situations that can consume the

attention and skills of financial managers leaving little time to monitor the overall performance of

the organisation. It is absolutely essential that ERP suites be considered that handle multi

currency, multi company structures with ease, and also provide a structured framework for

dealing with variations in tax law.

The realities of moving into new territories and new markets often involve language issues and

process integration issues. Once again an ERP suite should be able to provide multi-lingual

capability and enable process integration regardless of currency, company structure and tax law.

Managing Risk

Information reduces risk. This relationship between risk and information is immutable, and where

there is information duplication, fragmented systems, incompatible systems and other symptoms

of a poorly integrated information infrastructure so there will be increased risk. What this means

in practice is that increased demands for information from regulators, governance bodies and

other senior management have come about because risks have increased. It just is not viable to

have point solutions and different ERP systems running in different parts of the enterprise. Even

worse is the need to use off-system tools to manipulate and store information that quickly

becomes ambiguous and inaccurate. If an ERP solution does not have sufficient functionality and

performance to satisfy the whole enterprise then it should not be considered.

ERP suite suppliers that excel in helping management reduce risk provide technologies that are

aligned with major compliance and governance requirements. The technology should support

GAAP and IFRS along with various trade standards that are in place in many industries - the WEEE

(Waste Electrical and Electronic Equipment) directive in the electronics industry is a perfect

example.

Most organisations will be cognisant of the requirement to adopt IFRS and move from the

currently accepted GAAP accounting and reporting standards. An ERP suite should allow this to

happen in a smooth and unambiguous manner, since there will be a need to keep multiple books

in both standards for a period of time.

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Ease of Use

Ease of Use and ERP wouldn’t normally be put together in the same sentence. It is a well

documented fact that users tend to avoid ERP applications because of their over-formalised,

arcane user interfaces. This has changed over the last four or five years and a new generation of

ERP solutions have appeared with context sensitive help, easy navigation, ‘search from anywhere’

and other functionality that was lacking in earlier products. The traditional unfriendliness of ERP

solutions is well demonstrated by the fact that ‘Ease of Use’ is often the number one

consideration of managers as they select an ERP suite of applications.

Total Cost of Ownership

Many organisations have learned the hard way that total cost of ownership is a major

consideration when selecting an ERP suite. The actual licence costs represent a small fraction of

the total costs associated with the deployment and use of ERP applications, and many other

factors need to be taken into account. Hard costs include IT infrastructure, software licence and

maintenance, training and consulting. These are the costs that can be neatly placed in a

spreadsheet. Some of the potentially larger costs are harder to pin down.

There will be some level of disruption and the ERP supplier should be able to assist with change

management while having their own neck on the line if unforeseen difficulties arise. Integration

with other key applications is also an important issue. Once again the supplier should be able to

demonstrate skill in addressing integration issues, and have the technology to enable speedy and

efficient data and process integration.

Productivity

The productivity benefits associated with an effective ERP implementation will be found at all

levels within the organisation. High volume repetitive tasks require an efficient user interface that

is both easy to use and powerful. Users should be able to search for the information they need

from any location within an application. Navigating around menus is a fairly inefficient way to

move around an application. Some of the more contemporary ERP suites support a ‘move to

anywhere from anywhere’ paradigm.

Productivity gains are usually to be found in the details of how an ERP suite works. Simply the

ability to auto-fill fields and terminate a form at any time may transform the productivity

associated with some data input processes.

At higher levels within the organisation productivity will depend upon the ease with which data

can be accessed and reported on. Once again ease of use is very important. Clumsy interfaces and

arcane procedures will inhibit use and result in the low usage that is common in many

organisations. It is a fact that in many companies ERP licences are usually not fully used.

As far as the initial investment case is concerned productivity improvements tend to focus around

issues such as reduced stock levels, reduced head count and other cost reduction mechanisms.

While many investment cases focus on these ‘hard’ returns, the most meaningful productivity

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improvements tend to be harder to define. Availability of an integrated view of company

operations is key to management efficacy through better decision making. An effective ERP

implementation will also mean less management time is tied up dealing with routine operational

processing, providing more time to deal with important strategic issues .

Return on Investment

Most investments in ERP applications are predicated on a credible return-on-investment (ROI)

argument. It has historically been the case that ROI was quickly forgotten as management

wrestled with the complexities and problems that are associated with many ERP

implementations. When the systems are finally in place most managers were just thankful that

they made the finishing line. Things are different today. A harsher economic climate and greater

accountability mean that substantial investments must be seen to be effective. Managers should

insist that ROI is a central part of the relationship between their organisation and the supplier.

This means that a formal ROI environment needs to be created, with software

assistance if possible.

Most managers will be looking for specific returns such as reduced inventory

and headcount. However various studies have shown that effective use of an

ERP solution can result in overall operational and administrative cost savings

that are in the order of ten per cent. Customer satisfaction is also often

improved through more timely access to information – although benefits such

as this are notoriously difficult to measure.

Of course measuring ROI is only part of the story. There should be actions

available to management if ROI is inadequate, and it is up to the ERP supplier

to share some of the risk. An experienced supplier will advise on the services necessary to make

sure the ROI predictions become a reality. Change management support is essential, as disruption

during implementation can have serious adverse effects on the eventual ROI. Managers should

measure how serious a supplier is about ROI by evaluating the tools offered to track the real

returns.

Islands of Automation and Information

The information environment in most organisations is much broader than the ERP suite.

Customer relationship management, content management, social networking, specialised

bespoke applications, business process management and many other applications need to

interface with the core transactional systems. An ERP suite cannot be closed to outside data

sources – both structured and unstructured. Service Oriented Architectures offer one popular

means of getting applications to talk with each other, and an ERP suite should provide full support

for this de facto standard.

Everyday integration with office application such as spreadsheets, word processors, desktop

databases and other productivity aids is essential. Spreadsheet usage is both a curse and a

blessing. It allows managers to compile very specific reports, but presents opportunities for data

It has historically been the

case that ROI was quickly

forgotten as management

wrestled with the

complexities and problems

that are associated with

many ERP implementations.

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duplication and inconsistencies. The ability to link a spreadsheet directly to data in an ERP system

should be a very high priority. Spreadsheet hell is common in many organisations and introduces

significant risks – no least in the audit process.

The ability to link ERP applications with office applications should not result in the need for a

large number of user licences. Suppliers provide differing methods to accommodate information

workers who need access to ERP data, and since the need to upload/download data is a transitory

process the ERP application should allow such access without the need for strict user based

licensing.

Services

The use of services is closely tied in to use of ERP applications. Most suppliers will provide

consulting services based on best practice, although this is where the similarity ends. The words

mean different things to different suppliers. For some it is simply an excuse to generate excessive

fees, while for others ‘best practice’ is a support service aimed at maximising the effectiveness of

an ERP implementation. Managers should certainly be aware of how a supplier generates its

revenue – a heavy consulting bias may be a warning sign, since consulting fees often outstrip

licence fees.

As we have mentioned elsewhere in this paper, perhaps the most important service a supplier

can offer is help with change management – based on experience. ERP deployments have often

been the cause of significant, and expensive disruption. Other services might include hosted

services, where the supplier hosts the applications, and other functions such as help desk

outsourcing.

Conclusion

Next-generation ERP is easily distinguished from the first generation of technology that most

managers are familiar with.

Support for complexity – multi currency, multi company organisations subject to

variations in tax law and regulation need an ERP suite that will support the complexities

inherent in such operations.

Complete financial integration – with sufficient functionality and capability that the whole

organisation can be integrated and operations optimised.

Risk management – providing the tools to satisfy auditors, regulators and governance

bodies.

Performance management – with tools that can be used by managers to monitor KPIs and

other metrics via dashboards and other graphical interfaces.

Ease of use – through a flexible, configurable user interface and ‘from anywhere to

anywhere’ navigation.

There are large established ERP suppliers already providing this level of capability, and managers

should seek out those who supply systems that satisfy these requirements.

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Industry Perspective

Written byMatt Muldoon, Senior Director – Product Marketing, Epicor Software

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The New Era of Financial Management – Delivering Compliance, Insight

and Efficiency

A modern, integrated Enterprise Resource Planning (ERP) system is your financial and operational

backbone and reaches into all areas of your business and value chain. Any ERP system must

support, not constrain your ability to execute business strategies that will make your company

more successful and establish it as an industry leader.

Traditional, standalone financial systems automate only a single business function and not an

entire, cross-functional business process; they demand manual, labour-intensive processes, such

as re-keying data into separate systems. Legacy systems are also inflexible as they don’t permit

organizations to change their business processes to adapt to changing business requirements nor

do they provide visibility across the organization—let alone across the extended supply chain.

If your organization faces any of the following issues, then you need to be investigating the added

value of a next-generation ERP system:

Are you planning on adding new businesses by growth or acquisition?

• Are you subject to generally accepted accounting principles (GAAP), International

Financial reporting standards (IFRS), Sarbanes-Oxley, or any other national or

international financial oversight?

• Do you need financial transparency across all of your business units or is your

organization still using spreadsheets to manage its financial health?

•

Are you using a highly customized system that does not allow the ability to upgrade to

new, more efficient technology platforms?

• Are your processes manual or require large amounts of manual intervention for complex

or repetitive transactions?

Transparency and Visibility through Enterprise Performance Management

First and foremost, an enterprise needs to have a finger on the financial pulse of the company,

and as the pace of business continues to accelerate, you must move rapidly with precision and

agility, reducing reaction time and optimizing financial performance. You can’t afford to miss an

opportunity or delay a necessary course adjustment. That means that everyone in your enterprise

who impacts the financial results must know how the business is performing on a daily basis. In a

global business environment, forward-thinking and planning is vital. Critical financial metrics can’t

be permitted to get lost in the information morass.

Many businesses are finding that it’s no longer enough to respond to financial trends uncovered

by complex business intelligence tools, all too often removed from the point of decision and

managed and used by a limited few. Today, decisions that affect the overall performance of the

business are being made top down and bottom up on a daily basis.

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In response, a new breed of enterprise business application, such as Epicor ERP, has emerged that

includes operational tools that measure performance as business happens; managing workflows,

and alerting people as they work. Today’s information workers want decision support in real-

time, and they want it deployed in the tools they already use, day in and day out. Enterprise

Performance Management (EPM) solutions offer end-to-end capabilities that remove the barriers

to better business insight through a combination of intuitive user experiences, user driven key

performance indicators (KPI), and pre-packaged analytics that have real meaning to the business.

Today’s enterprise-level financial systems should also come standard with embedded executive

dashboards and graphical KPIs designed to give executives and line of business managers alike the

strategic financial data required to make critical short- and long-term decisions. Strategic use of

these resources allows you to manage your company by exception, as opposed to micromanaging

the increasing number of financial variables and demands being placed on your company. Some

examples of standard financial dashboards and KPIs that you should include in your evaluation of

vendors include calculation of days sales outstanding (DSO) and days payable outstanding (DPO)

to determine your organization’s cash flow position, supplier performance metrics, sales order

backlog and scheduled shipments, and so on.

Individual KPIs and combinations thereof (typically known as scorecards or dashboards) bring

together high level visualization of business processes and business events, so that you can

monitor your organization and carry out benchmarking or performance based management. EPM

delivers this level of business insight via a solid and highly productive foundation to make it easier

than ever to raise business performance to the highest level.

Support for the Global Enterprise

Successful companies grow. Whether through acquisition or organic growth, more and more

companies are wrestling with the complexities of managing multiple business entities and a

complex global supply chain. The growth and globalization of a company means that their

enterprise financial systems are often challenged to provide full visibility across the entire

enterprise.

There are unique challenges of running an organization that operates internationally and

opportunities with respect to consolidation for tighter control and reduced operational costs,

enterprise wide visibility, inter-company supply chain management, and financial consolidation.

Integrated, modern ERP systems come with global support embedded, providing the centre-point

for the organisation’s global transactional infrastructure.

Sound enterprise financial management practices should be designed to automate and

streamline your financial business processes by providing the tools needed to create value

through monitoring financial conditions for timely decision making. The enterprise application

system acts as an integrated, single repository of data which provides an accurate view of all of

your financial data including a 360-degree view of your customer – from customer specific credit

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information to consolidated order, invoice and payment history. These capabilities should almost

be considered a ‘given’ – good enterprise financial systems should always do these basic

functions.

Corporate growth and expansion inevitably leads to new markets and new geographies. Ensure

the vendor you are evaluating has multi country and language management capabilities that can

manage your business wherever you need to be in the world with support for country-specific

requirements.

For example, an organization that is headquartered in one country can deploy applications in the

native language for that country. When a satellite office in another country needs to add users

that require another language, the only difference for the user is the language. All corporate

processes that the headquarters have deployed are unchanged and no local language

customizations are required at either location.

This multi-country functionality surrounds not just having the applications screens appear in the

localized language. A modern ERP system, like Epicor, will include a financial management

application that is both global in its deployment AND local in its configurability to meet local

financial and tax regulatory requirements. You need to be able to deploy and manage master

data to ensure that your company and disparate business site information meets local regulatory

requirements and also provides the consistency needed for real-time distributed operations,

leading to greater customer satisfaction, operational efficiency, and ultimately business

performance.

Integrated Governance, Risk, and Compliance (GRC)

Achieving financial visibility and effective controls within the enterprise can be a formidable

challenge when many of the processes and procedures in place remain manual and fragmented.

Is your organization getting the complete picture of its financial and security health or does it lack

the transparency needed to identify and understand risk?

With the increasing nature of worldwide compliance regulations, the need for corporate financial

visibility has become necessary for any size organization—public, private and non-profit.

Regulatory bodies and audit firms are all advocating the need for improved financial management

and visibility. Many companies today have to deal with numerous information sources, from

legacy software programs created to help run specific departments to other packaged

applications that may have been purchased and implemented across the company over time.

Combining the disparate data sources internally and reconciling between the individual

departments is a huge undertaking. While departmental spreadsheets and legacy data systems

may be providing an adequate financial management solution today, as the need for centralized

financial data and financial visibility increases, spreadsheets and home-grown systems will no

longer be a viable solution to run a business.

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Achieving financial visibility and effective controls within the enterprise can be a formidable

challenge when many of the processes and procedures in place remain manual and fragmented.

Effective governance, risk and compliance (GRC) initiatives help companies and their employees

stay compliant, and ensure that employees at all levels of the organization are aware of the

associated risks of non-compliance. Expectations are rising among auditors, regulatory bodies,

customers, and other stakeholders regarding the protection of corporate information against

piracy, fraud, and sabotage concerns. ERP systems control the majority of the information that

could potentially be at risk.

It is not uncommon for companies to use multiple enterprise software solutions in different

divisions or business entities. Additionally, they may be running multiple instances or copies of

the same software, and have a variety of stand-alone or point solution applications—such as

order entry or general ledger—that are not integrated, or at best minimally integrated. There

may also be a variety of separate databases, tools, and spreadsheets used for reporting, all which

may be generating different versions of the truth.

Next-generation ERP delivers GRC functionality through a combination of embedded capabilities,

modules and related services. Compliance is at the heart of the applications and is consistent with

published international standards and best practices. These include published standards in

corporate and financial governance such as IFRS and GAAP while also incorporating support for

international trade standards such as restriction of the use of certain hazardous substances in

electrical and electronic equipment (RoHS), Waste Electrical and Electronic Equipment (WEEE)

directive, and the North American Free Trade Agreement (NAFTA).

Closely related to the topic of leveraging an integrated solution for GRC, is turning to technology

to support GAAP and IFRS. In August 2008, the US Securities and Exchange Commission (SEC)

published a proposal for a schedule for IFRS to replace GAAP as the international standard for

measurement of accounting practices and financial reporting. The proposed deadline for full

conversion and compliance by U.S. publicly traded corporations is 2016. Canada is expected to be

completely IFRS-compliant by 2011. GAAP have long defined the standards for accounting and

related practices in the U.S. and Japan while IFRS is the financial governance and reporting

standard that has been implemented in over 120 European and Asian countries. A modern ERP

system can help you manage the transition to IFRS – keeping multiple books in both standards.

Technology Matters – Scalability and Extensibility through Service- Oriented Architecture

Technology is the foundation upon which most businesses use to execute their objectives. At the

same time, it is important that the technology doesn’t overwhelm a business but instead

operates seamlessly and effectively in the background. Today’s business architecture of

enterprise applications can provide a rich user experience, affording opportunities for greater

user collaboration and productivity. The right ERP system offers new levels of extensibility and

scalability in a technology that meets a company’s requirements today yet remains flexible

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enough to accommodate opportunities in the future. It is this combination of capabilities that

constitutes the enterprise application business architecture of the future.

It is the unique nature of applications built using a service-oriented architecture (SOA) for flexiblemanagement, development and deployment through a granular, solution-assembly approach that

create user and cost efficiencies. Quite simply, by using enterprise applications based on a SOA,

organizations can easily add new functionality in a highly granular fashion, as they need it, and

can easily reconfigure workflows with minimal integration costs or impact on their business

operations.

Organizations can purchase just what they need today with minimum risk. As the organization

grows and expands; the ERP solution can grow and expand along with them. For example, a

manufacturer can make its internal systems available directly to its customers’ purchasing

systems, allowing the two systems to function as a single system via SOA. As a result, modernbusiness architecture can transform relationships between business partners into closer, real-

time relationships.

When assessing your current or future ERP system, one of the main items that you will need to

consider is the state of the business architecture. Is the enterprise ERP application architecture

leveraging the latest technology advances or is the vendor selling something that was architected

years ago and not updated to meet the current technological demands that today’s business

environment demands? Your organization will need to ensure that your software investments can

leverage next-generation business architecture, which exploits the latest technology platform.

Ensure that the software is developed for the evolving enterprise, offering maximum extensibility

and accommodating changes in performance or functionality while maintaining system

compatibility. With this development strategy in place, adding functionality is generally easy,

inexpensive and non-invasive. Existing systems can be enhanced and extended without local code

modification and capabilities from other systems can be invoked to extend the application. Focus

on the extensibility and interoperability of the software platform as this will yield affordability in

system adoption and maintenance. Additionally, this focus enables the technology to adapt to

new and emerging requirements, effectively protecting the technology investment.

True Cost of an ERP Solution - Delivering Return on Investment

Like any other technology investment, purchasing the software and licensing is just one element

of the overall cost. An extended financial ERP solution manages processes across your value

chain. Some of the results of this coordinated effort that help you achieve the maximum return

on investment with the shortest payback period include:

Improving cash flow performance

Increasing the accuracy of your costing

Protecting your profit margins

Reducing your inventories

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Shortening your product lifecycles

Increasing loyalty of your customers by responding faster and more effectively

On the investment side of the equation, the ability to provide a lower cost of ownership solutionis a result of three factors. First, is the system capable of delivering the same rich functionally as

tier-one systems that are targeted for Fortune 500 companies, but with an initial investment that

is a small fraction of the cost? An intense focus on programming development for the needs of

mid-sized businesses and also efficiency of implementation results in providing the same level of

functionality at a lower cost. Second, as a corollary to the low initial cost of ownership, the

reduced maintenance cost alone, based on the lower software cost, can substantially minimize, if

not entirely pay for, the cost of replacing an existing system. Third, that the underlying

technologies require minimal support, people and resources to maintain - far lower than most

other tier one and even comparable tier two system that do not feature a modern business

architecture.

Introducing Epicor Next-Generation Enterprise Resource Planning

In response to this climate of heightened financial governance, risk and compliance (GRC) with an

emphasis on supporting your financial management initiatives, Epicor has created next-

generation enterprise applications to help you achieve maximum optimization and performance

across your entire enterprise, whether it operates on a local, regional or global scale.

Epicor has long been a consistent leader and innovator for global enterprise resource planning

(ERP) solutions built entirely using a service-oriented architecture (SOA). In this approach,“services” are self -contained pieces of business logic that can be mixed and matched, are

platform independent, and can be dynamically located, invoked and used to configure and

reconfigure processes, and improve integration of applications.

The result of this leadership and innovation is Epicor’s next-generation enterprise software. It is

the foundation upon which businesses execute strategies and achieve objectives, one that

operates seamlessly and effectively in the background, enabling highly productive enterprise

optimization. Epicor offers comprehensive capabilities in support of strategic sourcing and

procurement initiatives, product lifecycle management, continuous improvement, lean

manufacturing, supply chain management and logistics optimization, and enterprise performancemanagement.

Epicor uses Epicor True-SOA™ built on the Microsoft® .NET Framework™ and offers a modern

business architecture that melds SOA and collaborative Web 2.0 concepts to give a business

maximum flexibility with minimal overhead. Epicor can take your business to the next level by

leveraging consumer Web concepts to deliver an agile, adaptable resource that can not only grow

and change with your business but is designed to help you optimize your most important

resources.

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About Epicor

Epicor Software is a global leader delivering business software solutions to the manufacturing,

distribution, retail, hospitality and services industries. With 20,000 customers in more than 140countries, Epicor provides integrated enterprise resource planning (ERP), customer relationship

management (CRM), supply chain management (SCM) and enterprise retail software solutions

that enable companies to drive increased efficiency and improve profitability, and also empower

global enterprises to achieve even greater success.

For more information, contact Epicor Software Corporation: [email protected]

Epicor Worldwide Headquarters

18200 Von Karman Avenue, Suite 1000

Irvine, California 92612

USAToll Free: +1 800.449.6772 (US/Canada)

Phone: +1 952.417.5207 (International)

www.epicor.com

Epicor Europe, Middle East and Africa Headquarters

No. 1 The Arena

Downshire Way

Bracknell

Berkshire RG12 1PU

UK

Phone: +44 (0)1344 468468Email: [email protected]

This article is for informational purposes only and is subject to change without notice. This article and its contents, including the

viewpoints, dates and functional content expressed herein are believed to be accurate as of its date of publication, March 2010.

However, Epicor Software Corporation makes no guarantee, representations or warranties with regard to the enclosed information

and specifically disclaims any applicable implied warranties, such as fitness for a particular purpose, merchantability, satisfactory

quality or reasonable skill and care. As each user of Epicor software is likely to be unique in their requirements in the use of such

software and their business processes, users of this document are always advised to discuss the content of this document with their

Epicor account manager.

All information contained herein is subject to change without notice and changes to this document since printing and other important

information about the software product are made or published in release notes, and you are urged to obtain the current release notes

for the software product. We welcome user comments and reserve the right to revise this publication and/or make improvements or

changes to the products or programs described in this publication at any time, without notice.

The usage of any Epicor software shall be pursuant to an Epicor end user license agreement and the performance of any consulting

services by Epicor personnel shall be pursuant to Epicor’s standard services terms and conditions. Usage of the solution(s) described in

this document with other Epicor software or third party products may require the purchase of licenses for such other products.

Epicor is a registered trademark of Epicor Software Corporation. All other trademarks acknowledged. This document and its contents

are the property of Epicor Software Corporation. Recipients of this document should not distribute to any third parties without

Epicor’s prior written consent. Copyright © 2010 Epicor Software Corporation.

mailto:[email protected]



http://www.epicor.com/




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