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New ERP skills needed to staff today's cloud systems

Manufacturers need to cultivate a new class of generalists who have expertise across technology and functional domains, including change management and collaboration.

The IT talent shortage presents one of the biggest obstacles to digital transformation, and the ERP segment is no exception. While it remains difficult to find employees with the requisite technical ERP skills, the lack of soft skills prowess in areas like change management and collaboration is proving to be more of a challenge to modern-day ERP success.

On average, a greater number of employers are struggling to fill open positions. According to a 2018 Manpower report, 45% of global companies are unable to find the skills they need, its highest peak in over a decade, and up from 40% in 2017. IT talent is particularly elusive. The 2016-2017 Manpower report indicated there were 600,000 IT openings in the United States alone, and research by Code.org projects there will be an estimated 1 million more computing jobs than available applicants by 2020.

The shift in ERP implementations from on premises to the cloud is also changing the mix of required ERP skills that manufacturers need to maintain in-house. Rather than building up a staff of network and server experts or specialty programmers versed in specific ERP platforms, companies need to augment their teams to include IT experts fluent in business-oriented competencies, like operations optimization, change management, integration and business process change -- all the skills that fall outside the scope of traditional ERP hires.

The shift in ERP implementations from on premises to the cloud is also changing the mix of required ERP skills that manufacturers need to maintain in-house.

"You still need core competencies like ABAP [Advanced Business Application Programming], systems administration and business functional skills, but those skills alone will not suffice," said Darshan Shah, senior vice president of delivery at Itelligence North America, a full-service SAP solutions provider that targets midmarket customers. "The paradigm shift happening in the market is that staffers have to be both technical and functional. It's no longer just one or the other."

Data is king

On the technical front, one of the emerging competency areas for ERP talent is knowledge of data analytics. Rather than a separate project, embedded analytics is now a critical part of ERP, regardless of whether systems are deployed on premises, in the cloud or in the hybrid cloud. Having ERP staffers who are versed in user experience and who know how to create and deliver dynamic reports that allow users to make more informed decisions on the fly is crucial to successful deployments.

"The Centiq State of SAP HANA 2018" report identified changing skills as a key barrier to implementing the next-generation SAP ERP platform. Of the people surveyed, 94% said the lack of ERP skills is a problem, including in specific areas like business process change -- 70% of COO respondents -- and S/4HANA analytics -- 68% of CIO respondents.

"From a skills perspective, big data expertise is important for ERP, whether from the manufacturing side of the house, from the financial perspective, or from sales and marketing," said Nanette Lazina, director of partner business at SAP. "There's a need for people who can figure out where to keep data and how to analyze data ... because what we do with data to make educated decisions is how we're going to drive the organization from where we are today to five years from now."

Beyond data analytics, there's a growing demand for knowledge experts in emerging areas like AI, chatbot management and robotic process automation as modern-day ERP is enhanced with these new capabilities. Most manufacturers lack trained experts in these nascent areas and many are unable to bring on dedicated talent given that the need for these competencies is still fairly narrow, and the candidates command top-of-the-line compensation.

One way to mitigate the skills shortage is to retrain existing IT staffers on some of the newer ERP skills -- a shift that can be accelerated with cloud deployments. The Mint Jutras "2016 Enterprise Solution Study" on the impact of SaaS ERP on IT staffing levels found that 59% of those surveyed were not reducing the number of IT employees, but were rather deploying them more strategically.

Along with new technical competencies, the emphasis on building out a bench of talent versed in soft skills goes hand in hand with what's really important to modern-day ERP success -- breaking down traditional silos and empowering transformation via change management. In that vein, manufacturers need to cultivate IT staffers that have more generalist skills, including the ability to work collaboratively as a team and to see the big picture, and not merely focus on solving technical issues.

"It's really important to have people who can think across silos about what's needed to succeed," said Josh Greenbaum, principal at Enterprise Applications Consulting. "If you're trying to transform a company, you can't do just CRM -- you need to do CRM connected to ERP and SCM [supply chain management] and people. All of these processes have to interact and interconnect or you won't be successful."

This was last published in February 2019

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What specific skills for a cloud-based ERP system is your company looking for?
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You DO NOT need to be both Technical & Functional!  That is just asanine...I want my technical team focused on the technical aspects of the NEW SAP tools and technology...I want Technical experts not half a**ed in both.  FOCUS will be key in this area and in this critical time of migrations to S/4.
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