Enterprise resource planning (ERP) systems have evolved significantly over the years.

The inventory control packages of the 1960s gave way to the materials requirement planning of the 1970s and then to the first versions of ERP as we now know it in the 1980s. Since then, ERP systems have gradually become more flexible, scalable and generally practical to use for companies of all sizes. Modern ERPs may offer multiple deployment options (e.g., in the cloud, on-premises or in a hybrid setup) and be tailored to the specific requirements of an industry like manufacturing.

As we look ahead to 2020, ERP change is ongoing. Let's look at a few of the major trends to pay attention to in the next year and beyond.

AI and machine learning will become more prominent in ERPs

Artificial intelligence (AI) and machine learning have already reshaped how people interact with their phones, tablets and PCs via voice-powered assistants. Now these technologies, which approximate human-like reasoning, are making inroads into ERPs.

Within an ERP system, AI and machine learning can help automate key workflows, improve information search and extract insights from large datasets. For example, AI algorithms might be able to pinpoint correlations between fluctuations in inventory and specific business function, in much less time than a human could.

Cloud ERP implementations will keep gathering momentum

Cloud computing has become a more popular deployment model for almost all types of business software, ERP included. Although a cloud-based setup might not be the ideal fit for every organization, for many it can deliver distinct benefits, including easier management, fewer upfront costs and continuous updates for functionality and security from the vendor. Overall, cloud ERPs can be highly flexible, scalable and cost-effective.

While most core company applications still run on-prem as of 2019, many IT decision-makers are at least considering a move toward cloud. There's risk involved, to be sure, since many existing ERPs are huge investments that can be tricky to migrate, but look for interest in cloud alternatives to keep rising. Note that "cloud ERP" may refer to software hosted in a service provider's public cloud, in a dedicated private cloud, or in a hybrid cloud that mixes different IT environments.

ERP adoption among SMBs will continue to grow

ERP systems were once associated primarily with larger enterprises, which were the only organizations that could reliably afford the costs of implementing an ERP solution, as well as the required ongoing maintenance. That's not the case anymore, as SMBs have implemented ERPs en masse and should continue to do so in 2020.

SaaS-based ERPs, which are managed entirely by the cloud service provider, are particularly popular among SMB organizations. IT research firm Forrester once estimated that most SaaS ERP adoption came from SMBs looking for an all-in-one solution, which SaaS can usually provide.

We've only scraped the surface of what the future of ERP will look like. To learn more about how to find the right ERP setup for your organization, reach out to the Accent Software team today.