Editing Enterprise resource planning (section)

== Postmodern ERP ==
The term "postmodern ERP" was coined by [[Gartner]] in 2013, when it first appeared in the paper series "Predicts 2014".<ref name=":2">{{cite web|url=https://www.gartner.com/doc/2633315/predicts--rise-postmodern-erp|title=Predicts 2014: The Rise of the Postmodern ERP and Enterprise Applications World|publisher=Gartner Group|access-date=October 31, 2016}}</ref> According to Gartner's definition of the postmodern ERP strategy, [[Legacy system|legacy]], [[Monolithic system|monolithic]] and highly customized ERP suites, in which all parts are heavily reliant on each other, should sooner or later be replaced by a mixture of both cloud-based and on-premises applications, which are more loosely coupled and can be easily exchanged if needed.<ref name=":2" />

The basic idea is that there should still be a core ERP solution that would cover most important business functions, while other functions will be covered by specialist software solutions that merely extend the core ERP. This concept is similar to the "best-of-breed" approach<ref>{{cite web|url=https://www.gartner.com/doc/3171517/postmodern-erp-strategy-bestofbreed-approach|title=Postmodern ERP Strategy Is Not a Best-of-Breed Approach|publisher=Gartner Group|access-date=October 31, 2016}}</ref> to software execution, but it shouldn't be confused with it. While in both cases, applications that make up the whole are relatively loosely connected and quite easily interchangeable, in the case of the latter there is no ERP solution whatsoever. Instead, every business function is covered by a separate software solution.<ref>{{Cite web |date=2020-01-27 |title="ERP, the Future of Applications, and the Composable Enterprise" by Mike Guay |url=https://blogs.gartner.com/debbie_wilson/2020/01/27/erp-future-applications-composable-enterprise-mike-guay/ |access-date=2022-12-12 |website=Debbie Wilson |language=en}}</ref>

There is, however, no golden rule as to what business functions should be part of the core ERP, and what should be covered by supplementary solutions. According to Gartner, every company must define their own postmodern ERP strategy, based on company's internal and external needs, operations and processes.<ref name=":2" /> For example, a company may define that the core ERP solution should cover those business processes that must stay behind the firewall, and therefore, choose to leave their core ERP [[On-premises software|on-premises]]. At the same time, another company may decide to host the core ERP solution in the cloud and move only a few ERP modules as supplementary solutions to on-premises.{{citation needed|date=May 2021}}

The main benefits that companies will gain from implementing postmodern ERP strategy are speed and flexibility when reacting to unexpected changes in business processes or on the organizational level.{{citation needed|date=March 2024}} With the majority of applications having a relatively loose connection, it is fairly easy to replace or upgrade them whenever necessary. In addition to that, following the examples above, companies can select and combine cloud-based and on-premises solutions that are most suited for their ERP needs. The downside of postmodern ERP is that it will most likely lead to an increased number of software vendors that companies will have to manage, as well as pose additional [[Application Integration Architecture|integration]] challenges for the central IT.<ref>{{cite web|title=The end of enterprise resource planning|url=https://cen.acs.org/business/informatics/end-enterprise-resource-planning/98/i10|access-date=2020-06-02|website=Chemical & Engineering News|language=en}}</ref>