ERP integration is not a new concept, so why has it recently become such a hot topic? It is related to evolution. Cloud ERPs have evolved beyond their traditional role of finance and core process management systems. Driven by AI and powerful databases, modern ERP systems are becoming the central hub of all operational processes across a business. And just as ERPs evolved, so have other business software applications—growing daily in sophistication and number. At the same time, employees and team leaders continue to download and use business-specific software applications without informing their IT team. These apps are not integrated with the ERP, nor are they properly secured and monitored.

Traditional application integration methods are slow and require the writing of a great deal of error-prone bespoke code. This poses a challenge for modern businesses who seek the security and visibility that come with app and ERP integration, yet do not wish to lose their competitive edge by becoming bogged down in time-consuming, manual processes. The good news is that the best cloud ERP systems come ready-made with pre-built integrations that ensure a quick and easy connection between some of the most common business applications—and are maintained by the software provider. And as your company’s software and application landscape becomes more complex, integration platform as a service (iPaaS) solutions are ready to go—custom-built to fit with the best cloud ERPs.

What is ERP integration?

ERP integration is the method by which a company connects its ERP software with other, specialised applications and processes—across your entire business.

In a recent Deloitte survey of senior procurement executives, “poor integration across applications” was cited by almost half the respondents as one of the “top three issues” they were facing today. ERP and cloud-based app integration solutions help to address this issue with a powerful, unified approach—combining the operational capabilities of an intelligent ERP with integration software, specifically designed to automate, streamline, and scale these essential activities.

Cloud ERP integration and API management

A few years ago, when there were only a handful of essential business apps, it was feasible to manually implement an application programming interface or API—software that allows systems to communicate with one another—to connect applications with a legacy ERP system. But as the number of essential apps increased, manual API management methods resulted in exponentially more complicated systems and “spaghetti code” that became difficult to manage and untangle.

In response to the growing need for simplified integration, today’s best ERPs now come equipped with a number of pre-built connectors, APIs, and integration tools. Typically, the prebuilt APIs in a modern cloud ERP are sufficient to manage several applications, but without dedicated integration software, you are still in a position of relying heavily on IT teams to manage custom APIs, mapping and coding.

Typical priority areas for ERP system integration

As ERPs and SaaS solutions evolve, new opportunities for enterprise integration will arise. But for most businesses, the examples below represent some of the commonly integrated operational areas.

CRM

CRM is one of the go-to tools for sales and marketing teams because it provides them with access to information and history about individual leads. This enables them to personalise their interactions with customers to provide a better experience and increase the opportunity for conversion. A CRM/ERP integration enhances this process by providing real-time market intelligence, demand metrics, and data analysis. With more accurate and relevant information, marketing messaging is more targeted and on point, and sales teams can better nurture prospects.

Business Intelligence

Business intelligence (BI) software is all about understanding data. It begins by curating and collecting it from the finest sources. BI tools then use AI-powered technologies to carry out specific analyses on that data with the ultimate aim of providing highly actionable insights. Often, BI solutions lead to the implementation of new processes or workflows—and sometimes entirely new business opportunities. With cloud BI/ERP integrations, these insights can be centralised and more quickly shared with the people best positioned to act on them.

Human Resources

The complexities of HR and human capital management (HCM) have been increasing at a rapid pace. Aside from the almost overnight disruption that the pandemic brought to HR operations, these teams are under further pressure to be data-driven profit centres. With HCM/ERP integrations businesses can continue to benefit from a range of purpose-built HR applications and systems, and they can enhance those systems with the functionality of cloud ERP. From recruitment to retention to retirement, ERP system integration helps to inform and automate activities in this demanding and fast-changing department.

Project Management

Clichés endure because they are usually true—and none more so than the old saying: “You don’t plan to fail, you fail to plan.” Yet despite planning tools being so important, project management solutions are often among the most operationally siloed. They can be complex to learn and once they’re embedded, teams are reluctant to relinquish them. But the good news is that a project management/ERP integration means that the best project management systems can be integrated separately with a centralised ERP. So teams can continue using tools they are familiar with, yet there can still be a unified view of every project and team—including consistent reporting templates and information exchanges within a single database.

E-commerce

E-commerce applications are typically among the first to be integrated in any company. But today’s e-commerce is about much more than just paying for things. At present, the most competitive opportunities come with the ability to leverage point-of-sale data. Smart shelves and trolleys can instantly connect with warehouses—and ultimately supply chains—to streamline supply and demand. Marketing and sales teams can also benefit from real-time omnichannel purchasing data and reports. E-commerce/ERP integrations can help connect your e-commerce applications and processes to the wider and more powerful data ecosystem.

Enterprise asset management (EAM)

Businesses that use any kind of machinery, heavy equipment, or fleets in their operations were among the first to realise the full potential of EAM and IoT technologies. But with ERP system integration, IoT data can work even harder. It’s great when your assets can tell you when they need servicing, but what if they could tell you how to build workflows that would help them run cooler and more efficiently? What if your IoT data could help you change your product design so that manufacturing processes were leaner and more ergonomic? What if your delivery fleet could automatically optimise loads and routes to minimise fuel consumption and wear and tear? EAM/ERP integrations help to bring together the most intelligent supply chain and manufacturing solutions, with the analytical power of cloud ERP.

Customer service

We hear about omnichannel shopping and how today’s consumers expect a seamless experience across whichever online or offline channels they choose to shop or purchase from. Well, along with that comes a heightened expectation for omnichannel service. At present, in both the B2C and B2B sectors, customer demands are high, loyalty is unpredictable, and competition is intense. AI-powered technologies such as natural language chatbots and recommendation engines are helping businesses to maintain a personalised touch in their automated activities. But truly outstanding customer service requires the ability for different departments to work together in real time. Whether it is a service and repairs request, a quality complaint, or a billing enquiry, customer service/ERP integrations can help to unify a variety of applications and centralise a source of customer data across operational areas.

Benefits of seamless cloud ERP integration

The benefits of cloud ERP are already well-established in several business areas—including enhanced productivity, improved visibility, and a centralised source of truth across the organisation. Essentially, ERP integration means that companies can deliver all those benefits across a greater breadth and depth of operations throughout their entire organisation.

• Real-time data. The ability to capture and manage complex information and Big Data is an essential feature of all modern business systems. But the real value in data cannot be realised unless you can understand and act upon it—quickly. Real-time data analytics and reporting give businesses a competitive edge by enabling them to make confident, informed decisions in the moment.
• Single source of information. Silos are at the heart of some of the worst operational inefficiencies. A single, cloud-accessible source of truth and information not only helps optimise operations, it also helps to reduce security risks and human error.
• Regulatory compliance. The past few years have seen record-breaking legal settlements in HR compliance alone. Integrating the power of cloud ERP into all your regulatory processes helps to ensure organisation-wide compliance across your operations.
• Agility and quicker decision-making. Rapidly changing business and customer demands mean that companies must be able to adapt quickly and responsively. When people and processes are integrated across your entire organisation—you gain the speed and agility you need to make informed decisions and rapid operational optimisations.
• Supply chain optimisation. From raw materials and manufacturing processes to your customers’ front door—every element of supply chain management can be optimised with the greater end-to-end visibility and analytical capability that cloud ERP solutions are designed to drive and support.
• Quicker return on investment. Understanding ROI, value, and profit margins is highly dependent on capturing and analysing the right data and delivering fast and flexible reports. This goes to the heart of cloud ERP—so much so that you can even use your cloud ERP’s functionality to assess the ROI of your own ERP system integration initiatives.
• Visual workflows. To optimise and automate workflows, you must first be able to see them and map them from a centralised viewpoint. ERP integration helps to deliver these views quickly, in flexible and actionable ways.
• Mobile access. Since the pandemic, the statistics around hybrid and remote work show an unsurprising upward trend. The best cloud ERP systems support mobility with device-agnostic usability that supports staff equally well in the office, at home, or on the go.

ERP integration and four methods of managing APIs

The integration landscape is a complex one. There are over 800 different integration tools and systems available, ranging from free open-source API management tools to sophisticated iPaaS solutions. The point-to-point (P2P) and enterprise service bus (ESB) models are older methods and while some companies still rely on API integrations, cloud-based, scalable iPaaS integration solutions have become the current gold standard.

Here are some of the more common methods of ERP integration and their pros and cons.

What is iPaaS—and how does it work?

Integration Platform as a Service (iPaaS) solutions use pre-built connectors and business rules to define interactions in multi-tenant environments. In other words, they are purpose-built to streamline and accelerate the development of integration flows across a diverse range of business operations.

Today, this is particularly relevant for businesses whose essential applications reside in the cloud. A modern cloud ERP will come with a variety of standard APIs and basic integration functionality. These out-of-the-box API management tools may be sufficient for businesses that only require a handful of core apps and APIs. However, most modern businesses have a much more complex application landscape and will require the power of an integrated iPaaS platform to help them streamline and smoothly manage their more complex application integration needs. This means that users can specify the types of application they need to use, and a cloud integration solution will manage the underlying API configuration, protocols, and prebuilt code that are needed to rapidly integrate the app with the ERP, and ensure it is running smoothly and safely.

Your ERP integration journey: A checklist

Your business processes are not going to become less complex. Your customers’ expectations are not going to suddenly stop changing. To obtain the best value from your enterprise software, choose solutions that are designed to grow and scale with your needs. A cloud ERP is at the heart of your company’s operations. So when enterprise integration becomes a priority, you will want to invest in a cloud-native iPaaS solution that is backed by the support and service you expect, and is specifically built to integrate with your cloud ERP.

Every business has unique goals and challenges, but as you begin your ERP integration journey, here is a checklist of initial items you will want to review with your software supplier.

To begin your ERP integration journey, seek solutions that:

• Integrate diverse systems and applications with the latest security protocols, with security patches that can be automatically updated in the cloud
• Streamline critical business processes and cross-business ERP functions
• Connect multiple applications and data silos
• Simplify integration across third-party apps and data sources
• Offer a robust range of prebuilt integrations
• Enable the ability to design, publish, and manage APIs
• Facilitate the development, availability, and lifecycle management of APIs
• Use pre-built integrations to reduce integration implementation and maintenance effort
• Benefit from an AI-assisted interface and low-code/no-code capabilities to support API development
• Have an AI-enabled cloud and hybrid integration development environment to reduce complexity and receive smarter recommendations
• Support multiple business partners and B2B integration with multiple trading partners