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Enterprise Distribution Software - Erp Solutions Versus Best-of-breed
By Peter J Wilson
The argument for a holistic ERP solution against best of breed, point systems to handle organizations’ supply chain management execution and logistics requirements has waged for many years and is almost a religious argument.


The ERP solutions case has always been about implementing a common technology platform that can deliver a fully integrated ERP distribution software system across an entire organization, generating cost savings and reduced implementation times.

Best of breed argues that companies need the additional functionality and expertise that can only be achieved by working with specialists in a particular field.

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The answer, as is so often the case in business - is somewhere in sport ween. Why should companies travel functionality for the significant benefits and cost-savings to be gained from an integrated system – and vice versa? There is no real right or wrong – it is all about identifying the business drivers and how best to meet them.

Not all ERP software solutions are the same. Some established ERP systems have a supply chain solutions heritage. This means the functionality and multi-location, multi-country and vertical specific capabilities of each element of the system holds up well, and often more favorably, against many of the best of breed suppliers. Even with functionally rich solutions the largest extremes of warehouses or the most complex transportation requirements can probably only be handled by a specialist advanced best of breed system. This is because the total ROI stacks up, but the reality is that these form a small percentage of the market.

Most companies need to look very closely at the bigger business benefits to implement ERP as an enterprise-wide integrated system, against the advantages to be gained from having the odd extra feature or capability.

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The functionality of ERP systems has risen dramatically over the years and the gaps sport ween them and best of breed applications are becoming less and less. The decision sport ween the two may come down to companies’ overall IT strategies. If it is already fragmented then it makes sense to add best of breed applications for specific operational areas. However, if the strategy is to move to a more rationalized common operating platform that can enable faster, more cost-effective deployment, complete integration and visibility that provide comprehensive means for measuring the business then integration ERP software is a clear winner.

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Having several best of breed applications

inevitably creates silos of information across a business. Whatever best of breed solutions claim about their applications’ ability to integrate with other business management supply chain systems, there is simply no comparison with an integrated ERP solution.

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The whole principle of an ERP system is that it is already integrated – best of breed simply can’t win this argument. Often each best of breed application has its own reporting tools, its own database management system and its own specific means of operation or integration. A good ERP system has a common solution for each of these across the whole organization.

ERP also has an advantage when it comes to adding further applications and functionality. For example, some solutions have created a Parcel Carrier Integration (PCI) application that allows companies seamless integration sport ween the supply chain inventory management systems and the parcel carriers’ own systems as well as customer services.

In doing so, PCI allows customers to save time within the warehouse, provide increased carrier flexibility, reduce errors, improve customer service and increase overall profitability. To add this functionality using a best of breed application would require considerably more in terms of time and cost to implement because it would have to be integrated with existing systems – if it were even available. Indeed most warehouse management software systems do not have their own transport systems and often partner with other best of breed solutions. As part of an ERP system it is already integrated and can be implemented and working very quickly.

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Where an ERP solution can bring specific industry capability, experience and high levels of supply chain execution functionality, the argument for going best of breed is a hard to one to win. For the sake of selective localized productivity improvements, companies are adding significant costs, increasing implementation time and risk and missing out on the massive benefits gained from complete integration and lower costs of ownership.

Companies should not just settle for either option, they need to know that they are getting a system without compromise. At the end of the day the secret is delivering business benefits and increased profitability and finding the right ERP solution for your business.
Peter Wilson is a consultant with IBS a developer of ERP Solutions, enterprise distribution software and supply chain management solution and EAI software.

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