10 Most Common Gaps Of Legacy ERPs
And how to solve them without open-heart surgery
Enterprise Resource Planning (ERP) systems are crucial to government infrastructure.
They are the center of critical financial data, enabling everything from double-entry accounting to vendor payments.
But when it comes to the modern needs of government, legacy ERP systems fall flat.
Today, many governments are looking to replace their legacy ERPs — but don’t know how.
ERP transition is often a cumbersome and daunting process that requires focused patience, time, and staff resources.
Governments looking to modernize financial operations without undergoing the “heart surgery” of ERP replacement are adopting a “best-of-breed” cloud software approach as an alternative technology strategy. This allows them to focus on more strategic financial processes – while keeping their “still functioning” accounting and record-keeping workflows in place.
Need more convincing?
Here are the top 10 areas your ERP comes up short and why you should consider OpenGov’s Cloud ERP to solve them. Our industry-leading platform offers modern budgeting, procurement, reporting, and citizen services solutions.
Legacy ERPs can handle the basics but not a proper budget process. There’s no notion of budget workflow, no way to track capital projects or their fiscal impact, no support for COA restructuring, and no way to plan for your workforce or create what-if scenarios. Most budgets using an ERP end up less thought-out, more siloed, and in multiple systems (including Excel).
See how the cloud software approach can bring immediate clarity to your budget process.
2. Reporting and Analysis
ERPs generally have rudimentary reporting capabilities but lack the tools that make reporting intuitive, fast, and dynamic. Interactive dashboards are missing, with no ability to drill into reports. Excel or other reporting tools, and people with expertise to use them, become a crutch. In the end, strategic insights are missed because those with access control the analysis.
3. Workforce Planning
Planning for the biggest expense in most agencies becomes a one-time static exercise, rather than a strategic process. Legacy ERPs don’t have the functionality to plan for personnel expenses fully. The ability to do complete personnel-level planning or handle complicated employee-benefit calculations is missing and often done in error-prone Excel spreadsheets.
4. Performance vs. Strategic Priorities
Governments are unified and focused on strategic initiatives, yet local government ERPs provide no easy way to budget and track planned to spend against them. They can’t integrate the data from other critical systems like 311, Parks and Recreation, or permitting. They cannot present data in a geospatial format or automatically track progress vs. goals.
Efficiently working together across or within departments is critical to any team’s success. Legacy ERPs don’t enable collaboration in real-time with notes, automatic notifications, and attachments.
There isn’t any way to collaborate with other governments to understand their benchmarks, results, and best practices.
6. Usability for Non-financial Users
ERPs are complex systems where access is highly restricted for cost, data integrity, and governance purposes. This is not ideal when your ERP system also serves non-financial users (such as budgeting collaborators or receipt submitters). When these users can’t understand what to do in a system, it creates bottlenecks that burden IT and Finance.
7. Public Communication
Engaging with the public is critical to the government’s success. ERPs hold much of the data, but unfortunately, they don’t have a way to put it in a digestible format for the public with context and interactive reports. Traditional ERPs also can’t gather public feedback critical to all decisions and plans.
Cloud technology helped Savannah, GA communicate more clearly with its constituents than ever.
8. Citizen-friendly Permitting and Licensing
Many legacy ERPs don’t take into account the wide variety of permitting, licensing, or other various forms of revenue-generating processes that require a modern citizen experience. Many citizen-facing application processes or online portals that directly impact financial operations require custom configurations or IT assistance and fall well short of a modern online experience.
9. Procurement Process
Most ERPs notoriously don’t meet buyers’ needs with poor collaboration features that often rely on antiquated solutions, such as word processors, emails, and spreadsheets which fail to meet the needs of modern procurement in the public sector. Government buyers are constantly being asked to do more with less, which can lead to being bogged down with mundane tasks such as developing solicitations, coordinating and evaluating proposal responses, managing contracts, etc. Plus, most of these tasks require public transparency that private market ERPs solutions fail to provide.
10. Modern Experience with Cloud Benefits
Your staff should have at least one piece of software they enjoy working in. By supplementing your ERP with a modern solution, you will experience the benefits of a cloud solution such as security, reliability, managed risk, continuous innovation, and an enjoyable user experience. Additionally, Cloud solutions don’t require hardware or complex upgrades and are accessible from anywhere there’s an Internet connection.
The Solution: OpenGov Cloud
Improve your processes and close the gap with your ERP by choosing the OpenGov Cloud, a modern solution designed to unify and automate the mission-critical processes of local government, while keeping accounting and record-keeping workflows in place during the transition.
OpenGov is transforming public administration through collaborative budgeting, automated procurement management, and intuitive citizen services solutions.
History of Government ERPs
First, what is an ERP system? How does the government use ERP software? When did ERP systems start being used? Put simply, an ERP (enterprise resource planning) system is a commercial-off-the-shelf software product that integrates and automates various functions.
By the mid-1990s, governments and non-profits began adopting legacy ERP systems to handle budgeting and accounting needs. These legacy ERPs also offered a stop-gap solution for the year 2000 problem. However, while they were an improvement from paper-based methods, legacy ERPs had very clear limitations and disadvantages.
In the years following the 2008 recession, OpenGov’s founders discovered that the City of Palo Alto had paid more than $10 million to SAP for an ERP system — Enterprise Resource Planning software for accounting, HR, utility billing, and other transactional processing functions — that came with green screens and was delivered on 20 disks.
The city was not alone. In fact, the State of California, among many other local governments, had long relied on accounting systems written in COBOL, the programming language most popular in the 1960s, and other legacy code languages. These types of on-premise systems were also disconnected from the Internet, meaning that data and information about government operations were siloed across multiple systems.
Users often had to spend long hours running queries or conducting analysis in tools like Microsoft Excel, and they were forced to pay consultants to build integrations and custom workflows. While legacy ERPs had their purpose at a point in time, it has become pointedly clear that it is time for local government officials to begin the process of moving to the cloud.
Advantages of ERPs
What are ERP advantages? At the time, legacy ERP systems offered a productivity improvement and streamlined day-to-day functions. Over time, though, the disadvantages of legacy ERPs have become more apparent.
The major difference between legacy and cloud ERPs is in how you deploy and access the software. Cloud ERPs live on servers the vendor owns or leases. Users access cloud ERPs through a web browser. Conversely, legacy ERP systems live on computers and servers the user owns and maintains, limiting access to those machines.
Now, organizations are making the move to cloud ERPs, which offer many advantages — chief among them the ability to work from anywhere.
Migrating off of them can be difficult, almost akin to open-heart surgery. However, with OpenGov cloud technology, you can maintain functioning legacy ERP workflows while embracing the benefits of the cloud.