Four steps to a modern ERP landscape

Volatile markets, costs, supply chain risks, and other external factors are increasing the pressure to strengthen competitiveness, innovation, and resilience. To cope with all this, modernizing their often outdated ERP systems is a crucial step for many medium-sized companies. As the technical basis for digitalization, automation, and continuous innovation, ERP is more than just IT—it is the backbone of corporate strategy.

Advanced, cloud-based systems open up entirely new possibilities. The latest transformation study by NTT Data Business Solutions shows that the skepticism of the early years has given way to widespread acceptance: 55.9 percent of companies are already migrating all or part of their applications to the cloud. But how can an IT upgrade be turned into a strategic success?

Step 1: Target vision and governance

The starting point for digital transformation is a precise definition of objectives. To make their organization fit for the future in terms of IT, companies should answer key questions: What role should ERP play in the business model in the future? Should throughput times be reduced, levels of automation increased, or greater transparency created in finance and the supply chain? Once the priorities have been set, they are translated into concrete processes and data targets in close consultation with the specialist departments.

Specifically, it is important to determine which end-to-end processes should become measurably faster, more stable, or less error-prone. What data quality and availability do these processes require? Clear responsibilities are equally important: Who is responsible for processes, master data, security/compliance, and change? A lean steering committee ensures that priorities are set, conflicts are resolved, and decisions are made quickly.

Step 2: Suitable operating model

Public, private, or hybrid—the right operating model is determined by corporate goals and regulatory requirements, not by trends. Companies seeking high standardization and rapid access to innovations will make different decisions than companies with high requirements for control, data protection, or complex integrations.

Cloud-based ERP systems such as SAP ERP Cloud offer scalability, short innovation cycles, and the ability to flexibly integrate new functions such as AI or automation—ideal for growth-oriented companies. They enable processes to be dynamically adapted, large amounts of data to be processed, and real-time analyses to be translated into better decisions. Decision-makers should pay attention to updateability and connectivity: How well can partners, platforms, or business models be integrated?

Security also remains a key issue. Companies expecting state-of-the-art standards, encryption, and access controls are usually better off with cloud solutions than with local data centers—provided that the company takes a strategic approach to security and brings experienced partners on board at an early stage.

Step 3: Finding the right partner

No two ERP projects are alike. Structures, requirements, and existing systems differ—which makes choosing the right implementation partner all the more important. A suitable partner helps companies make informed decisions that align with their strategic goals and give them a competitive edge. At the same time, they must be able to combine the advantages of standardized models with meaningful customization options.

Experience, methodological expertise, best practices, and the necessary understanding of processes are prerequisites for ensuring the best possible support before, during, and after implementation. However, industry expertise can also be helpful in cases with particularly specific requirements. In addition, companies should consider whether they want to take advantage of additional services such as change management, support, or innovation consulting. This is where ERP providers and IT service providers differ greatly from one another.

Step 4: Change and Enablement

ERP transformation is organizational development. Technology alone does not generate benefits—these arise through acceptance, competence, and practical working methods. Decision-makers must be aware that these necessary developments are not self-perpetuating, but require professional change management. This helps the various user groups to reflect on habits, understand benefits, and embed new processes in their everyday work.

The Transformation Study 2025 shows that managers who fail to take appropriate measures later regret it: 24.4 percent of respondents would design the change process better if they were to undergo another transformation; 29.3 percent recognize in retrospect the need to secure early support from decision-makers. To ensure that technology is not only introduced but also becomes effective in day-to-day business, it is therefore essential to actively support organizational change from the outset.

Strategy first

Cloud-based ERPs can be a game changer for medium-sized companies on the threshold of exponential growth if effectiveness is the guiding principle from the outset. To achieve this, it makes sense to be guided by clear dramaturgical principles: first the strategy, then the architecture. A strong partner brings experience, orientation, and speed to the process. It is also crucial to get employees on board early on, build up skills, and anchor new ways of working in everyday life. In this way, ERP becomes a reliable enabler of predictable, sustainable, and manageable growth.

Source: NTT Data

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