When you start looking to upgrade your accounting software or ERP solution, you realize that you have a lot of decisions to make. Will we keep an on premise product or move to the cloud? Who will be our implementation partner? What modules do we want and need? However, one of the biggest—and first decisions you have to make is this: should we look for an all-in-one product or should we look to choose the solution that meets the needs of each department?

Last month, we talked about how best-in-class applications allow you to build an ecosystem of applications that work together. Today, we would like to share some of the biggest reasons why traditional, monolithic ERP isn’t built for modern business models, why best-in-class applications have “disrupted” suites, and why a multivendor strategy works for your business.

Multivendor ERP: A Simple Definition, A World of Opportunity

The idea of choosing multiple vendors is simple. You choose a company for your accounting and finance, you choose another for your travel and expense, another for inventory management, tax management, time management and so on.

It may sound complex if you are moving from a traditional, suite-style enterprise resource planning application or are just beginning to outgrow your basic accounting software, but the multivendor approach is something that your staff will thank you for. Why? It’s simple: Everyone gets what they want.

The World Has Changed…Suites Haven’t

You may have heard a lot about the term digital disruption. While there are hundreds of thousands of articles on the topic—the premise of the term is that companies (or industries) get complacent, stop innovating, and fall apart when an agile and innovative competitor comes along.

From the classified-and-print-reliant media to the taxi industry to the brick-and-mortar retailer, complacency kills. In the technology world, this is twofold:

Disruptive businesses and disruptive business models have different needs

This will become more prevalent in the coming years. One such example would be a company that provides internet of things technologies. The business model for this type of company does not have a repeatable process, and needs more flexibility. Traditional ERP wasn’t built to meet different pricing models or rebate/discount/promotion strategies. It was built to provide a repeatable, all-in-one solution for traditional business models.

Suite providers (especially on premise focused ones) have been disrupted

What were some of the most commonly noted risks you’d see on a software vendor in 2010-2013? The subscription model, the rise of competitors in the cloud, and the inability to move quickly enough to compete. For many of these companies, a major change in business model would be akin to making a U-turn with a cruise ship.

For example, here’s a quote from one company’s financial statement in 2012:

“[…] there is a risk that [the company] does not appropriately respond to external business factors, such as changing business needs, changing technologies, competitor activities […].”

By 2014, the same company was quoted:

“The availability of live online solutions does not meet customer expectations or requirements […] We suffer a major issue with a significant, traditional, on-premise product (bugs, meeting customer expectations or upgrade experiences)”

In fact, Sage Intacct hired the analyst firm TechValidate to compare Sage Intacct to the aforementioned firm, presenting direct research from verified customers who made the switch. Read the survey results and quotes here.

The Real Advantages of Multivendor ERP

Taking a multivendor approach to ERP has two major benefits, most notably, its ability to mitigate the premise of shadow IT and “shelfware” that come when end users don’t like the suite life, and its ability to provide easier updates with fewer hassles thanks to the cloud.

Mitigate the Risk of Shadow IT

As humans, we like to find and use things that make our lives easier. This is a nightmare for chief information security officers (CISOs) at organizations using suites.

As we’ve said (and reiterated), you can’t please everyone with a suite. End users will gravitate to the products they know and love, turning your two-year suite implementation into “shelfware” (expensive IT systems that nobody uses).

As discussed in a CloudTech blog,

“When employees are forced to use tools they don’t like, IT departments lose control of security. It is our experience users will start looking for other mobile, fast and user friendly tools, causing IT departments to lose control of security and, more importantly, corporate content and intellectual property.”

While you can’t prevent all shadow IT by using best-of-breed applications, you can give your end users options—increasing the likelihood they find an IT-approved product that satisfies the needs of everyone.

More Frequent, More Robust Updates—Made Easy in the Cloud

Suites are built on the business model of trying to do everything for everyone. This means that updates have to not only support the financial side of the ERP application, but any other application they provide for users. Comparatively, best-of-breed applications are designed to handle a specific function.

In this, vendors of best-of-breed applications can put more time and money into improving specific tools and processes, rather than spreading resources over many different ones. This means better and more frequent improvements—often done in response to user requests.

You may be thinking, “updates are a hassle, why would we want to deal with a dozen different applications updating four times a year?” This is where the cloud shows its true value.

In the cloud, updates occur automatically with little or no involvement from your staff and little to no disruption to your business. Better yet, with products designed to work together, the updates rarely if ever compromise the integrity of the connections between applications.

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Wipfli LLP/Brittenford Systems was one of the first VARs to join the Sage Intacct Partner Program as we saw the immense value of the product for businesses looking to make their journey to the cloud easy. Following our initial success with Sage Intacct, we began to develop products designed to connect the best-in-class application to other best-in-class applications like Concur with our ExpenseConnect and InvoiceConnect solutions. Learn more about our Sage Intacct connectors on our website or on the Sage Intacct Marketplace.