Businesses should be in a constant state of updating and improving of their processes. There’s almost no process within a business that can’t be more efficient, optimised with better data use, resources and advanced technologies. When businesses are striving for success, analysing their processes is the key.

What are the differences between BPM and ERP? Many organisations implement either enterprise resource planning (ERP) or business process management (BPM) systems to analyse and gain knowledge from their data. These two systems are often conflated and do provide similar opportunities. However, they often differ in key ways. Understanding the differences between ERP and BPM will allow your business to leverage both tools to find optimisation opportunities and operational success. Let’s take a look at how.

What is ERP (Enterprise Resource Planning)?

Enterprise resource planning is a multifunctional software that enables businesses to perform a number of tasks. ERP grands users access to a whole suite of functions, from accounting and inventory management to human resources. At its heart, ERP works thanks to the collection and analysis of data – by centralising organisation’s data. ERP enables business functions to be streamlined across departments, ensuring everyone in the organisation works together.

ERP systems have an interface that enables employees working across diverse departments, to work together in real-time and accurately use shared data. In essence, ERP creates a digital network for the business by interlinking departments in a digital workspace.

What Is BPM (Business Process Management)?

Whilst we defined ERP as a platform of integrated applications allowing for centralised control of a business, BPM (business process management) software has a narrower scope. A BPM system maps out the business’ current operations, documenting the steps that the business takes in its various processes.

By capturing business processes in this way, advances towards optimised models can be taken within the organisation. Visualisation allows for bottlenecks and inefficiencies to be laid bare, enabling businesses to improve their processes.

The Benefits Of ERP (Enterprise Resource Planning)

ERP consists of integrated applications enabling organisations to take centralised control of their departments. From the outset, this act of centralising data systems and giving employees access across departments streamlines a number of business processes. Rather than data entry being performed multiple times, ERP gives users access to all data once it’s in the system, enabling workers to perform more complex and value-added tasks.

ERP also allows businesses to take a birds’ eye view of its core processes and to witness their real-time functioning. Rather than relying on obsolete data or analysing past performance, business function is revealed to the naked eye allowing for deeper analysis of an organisation’s processes.

ERP tends to focus on providing a picture of businesses’ cash flow, raw materials and inventory but it can also be integrated in process analysis and improvement tools to provide up-to-date innovations on business functions. ERP systems are very valuable for organisation when it comes to improving overall performance and revenue.

The Benefits Of BPM (Business Process Management)

In contrast to ERP, BPM offers a more granular exploration of business functioning.

BPM shows organisations how long each process takes to complete, providing an accurate picture of individual business processes. You can create workflows within BPM software, exploring opportunities for greater efficiency. The traditional presentation that BPM provides, flow charts with highlighted inefficiencies, makes it a highly readable model. BPM thus enables accurate decision making and comprehensive analysis of business processes.

What’s more, the new breed of BPM, like Comidor,  provides organisations with the opportunity to address their challenges with any intelligent automation technology needed.

These platforms include built-in RPA elements to automate time-consuming repetitive tasks as well as Cognitive automation capabilities with AI/ML to automate demanding processes with intelligence and drive decision-making.

Integrating ERP and BPM For A Complete Solution

Because of the overlaps in the purpose and functions of ERP and BPM software, combining the two systems doesn’t seem like an obvious solution. Sometimes BPM solutions are overlaid onto larger ERP systems, attempting to fill the gaps in the enterprise resource planning system.

When ERP systems are effectively integrated with BPM systems, organisations can achieve a higher level of understanding of their data – and how they can optimise it. BPM platforms can provide specified details on the organisation performance by monitoring processes and analysing KPIs, whilst ERP facilitates broader business operations and works as the central IT system.

A BPM platform is also a necessary tool in case of process re-engineering. As organisations grow, new processes need to be mapped and automated. Moreover, new additional steps need to be added to the existing ones.

In such a case, the BPM platform works as an additional layer and can be fully integrated with ERP systems in order to exchange data and automate the new processes.

Combining ERP and BPM could be the right thing for your organisation if you’re looking to achieve automation and optimisation of critical business processes. This holistic approach can become highly efficient and lead to flexibility and better adaptability to the market demands and challenges.

Conclusion

Improving and optimising business processes is essential. Both BPM and ERP systems are ideal tools that give businesses greater insight regarding their inefficiencies and progress opportunities . Despite overlaps in the functions of these systems, integrating BPM into a wider ERP system can provide micro- and macro-insight into how your business performs.

Author Bio:
Katherine Rundell is a business writer at Academic Writing Services. She gained her undergrad in computer science before getting her MBA at Edinburgh Napier University. Katherine is a freelance business consultant, supporting organisations to meet their revenue targets.

Legacy systems are the backbone of most of the world’s businesses. These systems were built decades ago and have evolved over time, but they are now facing new challenges, as shown in the example below.

A logistics company that uses an ERP application mainframe across the business with complementary task management cloud-based software and a third communication platform, faces a multiple data silo problem along with none of the applications supporting all components of the business model.

In this case, the company depends on its ERP-legacy system for most of its core business functions, but its scalability comes at a high cost and lengthy developing periods, holding back the business and its strategy to grow.

According to a survey (Figure.1) conducted by Deloitte on digital transformational challenges, legacy systems are high on the business challenges list.

From the above, we can safely assume that companies beyond the logistic industry face legacy systems challenges and start considering following legacy system modernization strategies.

Legacy system modernization approaches are a way to modernize legacy systems and make them more efficient. There are many different approaches to legacy system modernization. The management of the above logistics company has the option of rehosting their ERP, rebuilding or refactoring it, and rearchitecting it, before finally replacing it.

But which legacy modernization approach is the best? It depends on the business challenge each company is trying to solve.

Let’s discuss the different approaches on how to modernize legacy systems in detail.

1. API your ERP

Allow the legacy system’s functions and data stored or created, through an application programming interface (API), to be accessible as services, in solutions like Comidor Low-Code Automation Platform, that can leverage the application features and value.

• Pros: Intellectual data and organizational structure of information flow stay in the good old ERP legacy system.
• Cons: The quality of the knowledge created by the Low-Code solution depends on the data range and the form input in the legacy system.

2. Rehost

Keep the same functionalities and features and substitute the infrastructure which supports the legacy system, specifically going from an on-premises expensive and resource-limited installation to a cloud Infrastructure-as-a-Service (IaaS) solution.

• Pros: Easier than the first choice, non-recurring maintenance cost, and instant scalability.
• Cons:
  • In reality, no digital transformation takes place as the company must still navigate its business ambitions and strategy inside the legacy system’s hard-code limited functionalities.
  • No Low-Code Automation empowerment

3. Re-platform

Make minimal changes to the legacy system code or design by re-platforming a component of the legacy system to a new BPM platform.

• Pros: Leverage the core business function that is most important for the business model with low cost and timely implementation.
• Cons: The business can not react to changes in its market or new challenges beyond the re-platformed component function area.

4. Rearchitect

The first actual step into digital transformation and a legacy systems modernization strategy. Make changes to the legacy system code according to the microservices model that can be built, deployed, and managed independently. Technologies in this area include PaaS (Platform as a Service) such as JPlaton.

• Pros:
  • Exploit new and better capabilities of the legacy platform.
  • Business agility and faster time to market
• Cons: Expensive consulting and slow reacting developing process from the legacy system megacorp solution provider.

5. Rebuild

This legacy systems modernization approach involves a full digital transformation approach. Start from scratch by rewriting the legacy system components and rebuilding its new functionalities. In other words, the business is going for a custom solution that will address its unique business challenges.

• Pros:
  • It can be built as a cloud-native application from the start.
  • Leverages new coding techniques with faster developing times, better security, and custom network protocols.
  • Delivers the most value since it is core business functions oriented.
• Cons: Expensive consulting and slow reacting developing process from the legacy system megacorp solution provider.

6. Replace

(According to the 2018 Gartner survey- 2, with the participation of 71 Chief Strategy Officers: Old ways can’t help you grow)

Replacing the legacy system components with an out-of-the-box business app solution that allows constant rearchitecting options. This is achieved by a Low-Code BPM interface in a Software-as-a-Service (SaaS) solution, like Comidor Low-Code Automation Platform.

• Pros: All the pros mentioned in the fourth and fifth legacy systems modernization approaches, plus the following:
  • Always running the latest version without the need for updates,
  • Cost savings and better security
  • Shifting the support burden outside of the organization.

To sum up

Legacy systems modernization is a process that needs to be done to ensure that the company can comply with the changing business environment. However, Legacy system modernization should not be considered as an endpoint, but rather as a long-term process. It should be done in steps and with a legacy systems modernization plan in order to ensure success.