Consolidate or integrate? What to do with ERPs after mergers and acquisitions

It's a common scenario: a customer is either consolidating onto a single ERP, or integrating disparate ERP systems. How extensive that integration is - perhaps it's high-level financial data, or deep transactional data - depends upon the customer requirements. But with integration platform-as-a-service (iPaaS) solutions having matured greatly in recent years, the risk of integration projects has fallen and the urgency to consolidate has been greatly reduced in many cases.

In this article we will explore some common situations in which an organization might consider either consolidation or integration options.

Three common scenarios

The first situation is an acquisition, and I've never seen an instance in which it wasn't the acquirer's ERP that gets to stay. It's not really related to the complexity or the number of staff; it's the head office that makes the call, and I've never seen any other rationale.

A second common situation is that an acquirer may elect not to consolidate, but rather to integrate disparate systems. We have a situation in which an acquirer is running SYSPRO ERP and the child company is running Microsoft Dynamics NAV. They don't intend to switch out NAV, but want live integration across the two. Another instance is a very large beer manufacturer that's acquired a whole lot of companies using different ERP systems. They made the decision that at some stage, they will consolidate on a single ERP. However, between the issues of cost, skills and complexity, consolidation is not a priority for them; they choose to use that money elsewhere.

A third situation is that a company and its satellites are on the same stack but poorly integrated. Having the same stack is no guarantee of ease of integration. A system ...