Local Governments: What to Demand from Your ERP Solution

Remember Y2K? It was the buzzword of the late '90s, signaling a wave of technological advancements. Fast forward to today, and over 70% of U.S. local governments with more than 500 employees are still using ERP solutions from that era—before the iPhone, before high-speed internet was commonplace. The ERP landscape has evolved significantly since then, and it’s time for local governments to reassess their ERP needs.

Evolution of ERP Systems: A Quick Overview

Adapting Legacy Systems

Older ERP systems, often built on programming languages from the late 1950s, face significant challenges integrating new technologies. These systems require constant updates and patches, making it tough for software vendors to balance support for legacy systems while developing new solutions. This juggling act can compromise the quality of user experience and innovation.

Modernization Attempts

Legacy ERP providers have attempted modernization by integrating new tools and technologies, often acquiring niche technology providers to fill gaps. While this approach can enhance functionality, it also creates a complex web of solutions that can be costly and challenging to maintain.

New Generation Solutions

Post-Y2K ERP companies started from scratch, leveraging cloud-based, SaaS models in a multi-tenant environment. Despite the initial disadvantage of being newer to the market, these companies have rapidly advanced and, in many cases, surpassed their older counterparts in terms of functionality and efficiency.

What Local Governments Should Look for in a Modern ERP Solution

1. Commitment to Research & Development (R&D)

Your ERP vendor should be financially stable and dedicated to continuous innovation. A significant portion of their revenue should be invested in R&D. Choose a vendor that focuses on a single, unified version of their product rather than spreading resources across multiple versions and platforms.

2. Unified Version Across All Customers

A single version across all users enhances collaboration and problem-solving. It allows local governments to share best practices and solutions without worrying about version discrepancies. This unified approach helps address industry-specific challenges, such as changes in union regulations or organizational restructuring.

3. True Multi-Tenant SaaS Built on Modern Cloud Technology

Modern ERP solutions should be adaptable to the evolving needs of government organizations. Unlike legacy systems, which are rigid and based on outdated relational databases, modern solutions use advanced cloud technologies and in-memory object data models. This flexibility allows users to interact with data using intuitive business terminology rather than complex technical jargon, providing real-time insights and adaptability.

4. Seamless Mobile Experience

In today’s world, a seamless mobile experience is essential. Employees expect an ERP system that is easy to use and access across devices. Look for solutions with a mobile-first design, offering a consistent user experience across all modules. Beware of vendors that only provide a web interface on mobile devices or multiple apps for different functionalities, as these are signs of a less integrated solution.

5. Proven Results and Evidence

Ensure that the ERP solution has a track record of delivering tangible benefits to other government clients. Look for documented improvements in finance, HR, and IT, including cost reductions, increased efficiencies, and enhanced insights. A typical local government ERP project should have a payback period of 3-5 years, with savings from eliminating hardware, hosting costs, and outdated systems.

6. Dedicated Support and Value Realization

Your ERP partner should work closely with you throughout the implementation process and beyond. They should help you establish baseline capabilities, measure ongoing value, and validate the success of your system. These are long-term investments, so choose a partner that supports your transformation journey effectively.

By demanding these features and qualities, local governments can ensure they choose an ERP solution that meets their current and future needs, delivering maximum value and efficiency.