Avoid the Number One Mistake with IT Renewal Management – Your ERP System!

The elephant in your IT infrastructure has got to be the ERP (or Enterprise Resource Planning) system. Its functionality is immense and it often forms the backbone of most big companies.

From product planning, material purchasing, inventory control, distribution, accounting, marketing, finance, HR…there doesn’t seem to be any department that the ERP doesn’t touch.

But an ERP can’t do everything!

Technologies are getting more sophisticated and business processes more complex. This has resulted in an explosive growth in new enterprise product ranges such as the CRM, Collaboration, Support and Change Management Tools. As a result, the ERP system now sits in the middle of the IT environment with all these other systems either integrated into it or as standalone systems.

So I want to consider a problem that always crops up in our conversations with customers and prospects.

As you know, iasset.com’s core business is renewals and recurring transactions (aka Product Lifecycle). Renewals and recurring transactions are more complicated than a standard new product or service sale and we have not found any ERP that can properly manage them. Here’s some areas where ERP systems generally fall down when processing renewals.

ERPs lack required renewal fields

Serial numbers

There are many of these. Whilst many ERP systems will track “a” serial number they fail on tracking other critical information such as software license numbers, support contract numbers or the related channel parties involved in the transaction. In the context of a renewal, these are essential for tracing ownership of the software and the physical location of the product.

Maintenance End Dates

Another essential field is the maintenance end date. To accurately pre-plan renewals (indeed any kind of recurring transaction) you must know what the expiry date is.

Historical sales and contract information

The historical sales data or original contract information is also essential information for a renewal. These details are needed where a renewal has been lost, but the data should always be maintained on a database so you can win the renewal back next time. Although some of this information may be available in your ERP, it is not usually linked to the original product sale and requires a time consuming and inefficient process to extract it.

ERPs don’t generate quotes

Unless you buy an add-on (if available) and spend time and money integrating it, most ERPs are not designed as a quoting engine. It’s designed to be a repository of data – and a report generating engine. Quotes, however, are the vital parts of the renewal process and ERP systems are not designed with this functionality in mind.

ERPs are focused on financial reporting rather than transactional tracking

As mentioned, an ERP is just the repository of company information. It absorbs inputs, classifies data and then produces reports. As a result, the focus is more on reporting outputs, rather than tracking transactions through a process.

A renewal transaction is a process with specific stages, which must be tracked through to closure. In the same way a CRM has evolved to track opportunities and your ongoing relationship with your customer, a successful renewal sale needs to be tracked to an even greater degree.

There’s no doubt that the ERP is an essential component of most major companies today. However, like any system, it has its limitations and is not designed to address every business process. Remember that a jack-of-all-trades is seldom an expert at one.

Investing in a dedicated platform for what you’re trying to achieve, such as managing renewals, is essential to enabling maximisation of your opportunity, improved productivity and other workflow efficiencies. The key is to make all the systems work together by integrating them. This is where iasset.com can help you.

Stay tuned to read about the Number Two Mistake with IT Renewals - why your CRM can’t handle renewals either!