What ERP Applications Do and Don’t Do

The functionality of Master Data Management (MDM) and Product Information Management (PIM) solutions are in many organizations (yet) being taken care of by ERP applications.

However, there are some serious shortcomings in this approach.

If we look at party master data (customer roles and supplier roles) a classic system landscape can besides the ERP application also have a CRM application and a separate SRM (Supplier Relationship Management / Supplier Onboarding) application. The master data entities covered by these applications are not the same.

ERP do dont party

Party master data

On the sell side the CRM application will typically also hold a crowd of prospective customers that are not (yet) onboarded into the ERP application. In many cases the CRM application will also have records describing indirect customers that will never be in the ERP application. Only the existing direct customers are shared between the CRM and ERP application. Besides that, the ERP application may have accounts receivable records that have never been onboarded through the CRM application.

On the buy side a functionality of an SRM application is to track the onboarding process and thereby be the system of record for prospective suppliers. Only existing suppliers will be shared between the ERP application and the SRM application. Besides that, the ERP application will have accounts payable records that have never been onboarded through the SRM application.

A main reason of being for a Master Data Management (MDM) solution is to provide a shared registry of every real-world party entity now matter in what application they are described and thereby ensuring consistency, uniqueness and other data quality dimensions.

When looking at product data, ERP applications must often be supplemented by other applications in order to handle detailed and specific topics.

ERP do dont product

Product data

Product Lifecycle Management (PLM) applications are becoming popular when enterprise units as R&D, product management and others have to be supported in handling the series of detailed events that takes place from when a new product is thought of for the first time all through that it is retired and even after that in the period where complaints and other events may occur. ERP applications can only properly handle the main status events as when the product is ready for sale for the first time, when sale is blocked and when the last piece is taken away from the inventory.

Product Information Management (PIM) applications are becoming popular when enterprise units as sales and marketing need to provide specific product data that varies between different product groups. Not at least the rise of ecommerce has driven a demand for providing very detailed and specific product information to support self-service selling. ERP applications are not built to cater for this complexity and the surrounding functionality.

The information demand in this scenario does also encompass handling a variety of digital assets going from product images in many angles, line drawings, videos and more. Depending on the range of requirements this may be handled in a PIM application or separately in a DAM (Digital Asset Management) application.

Where there is no PIM and/or PLM solution in place, the fallback solution to cover the requirements not fulfilled by ERP is a bunch of spreadsheets.

The reason of being for multidomain MDM solutions is to cover the full spectrum of party entities, product entities together with other master data domains as locations and assets.

Check out the range of solutions to cover this space on this list.

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