ERP interfaces: Which connection should you choose?

The days when a single software monolith could completely cover a company’s IT requirements are long gone. Today, almost every department uses its own software system with a wide range of functions for specialist requirements.

To avoid isolated solutions and manual data exchange, the connection to the ERP system is out of the question. But how can effective networking be achieved without increasing time and costs excessively? The solution lies in a software adapter that links third-party applications with the ERP system without any programming effort.

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Why is ERP integration important at all?

Companies use an ERP system to manage as many tasks and data as possible in a central system. However, ERP solutions sometimes do not achieve the functional depth of dedicated business software, meaning that stand-alone software systems are still indispensable for specialist departments.

ERP systems must be able to communicate with specialized third-party applications to prevent data silos from forming through the use of such systems. This is possible with the help of suitable interfaces that ensure a stable link between the two instances. In a network of dedicated software solutions, the ERP system acts as a central data hub that enables organization-wide data exchange.

Advantages of ERP integration:

• Better data quality
  All departments have real-time access to up-to-date, error-free and consistent data that leads to better decisions.
  
• Increased efficiency
  Processes run faster and can be partially automated, which increases productivity.

• Less manual work
  Manual activities are reduced so that employees can concentrate on strategic tasks.

Typical examples of integrated systems

Product Data Management (PDM)

A PDM system is used to centrally manage and organize product data throughout the entire product life cycle. It stores technical drawings, parts lists and change logs, for example. When optimally networked, ERP and PDM control the entire product development process from design to market launch.

Learn more: Networking PDM and ERP

Computer-Aided Design (CAD)

Technical developers use CAD programs to create precise digital models and technical drawings of components and machines. Linking CAD software and ERP systems is essential for manufacturing companies. This is the only way to automatically transfer design data, parts lists and material availability data bidirectionally.

Learn more: Linking CAD software and ERP system

Customer Relationship Management (CRM)

Among other things, a CRM system enables the central recording and analysis of customer data and interactions. It is therefore an important tool for marketing, sales and customer service. However, to enable smooth processes across departmental boundaries, CRM and ERP must work closely together. Integration ensures a seamless exchange of customer and business data and avoids data redundancies.

Learn more: Linking CRM and ERP systems

Connection options: Which is the best?

Connecting external systems to the ERP solution is therefore a must. However, it is often not so easy to implement. Different data formats, protocols and standards as well as a lack of programming interfaces sometimes prevent direct communication between ERP and external systems. There are basically three options for setting up interfaces:

1. standard interfaces – the simple but inflexible solution

ERP systems usually come with a number of interfaces out of the box. In contrast to individually developed interfaces, these promise fast, inexpensive and simple integration. However, the crux of standard interfaces is compatibility: they are often only set up for selected partner products or widely used applications such as MES, PDM or CAD software.

It is also possible that a mutual dependency may arise between individual product versions of the ERP system and the partner product. This can have a massive impact on the update capability of both applications.

2. new development – the individual but complex solution

If the interfaces of the ERP and third-party system are not compatible with each other, there is no way around programming a customized solution. One of the two applications must therefore be technically modified so that it can address the interface of the other. The advantage of individual interfaces is that they are optimally adapted to the needs of the company and thus achieve a high degree of automation.

However, a new development also brings with it a whole series of disadvantages:

• High development costs
  An interface always connects two different software systems. It is therefore essential to involve both the provider of the ERP solution and the provider of the third-party system when programming. Otherwise, there is a risk that the two systems will work at cross purposes. The development process is usually very time-consuming and costly.
• Update risks
  Interfaces evolve over time – just like any other software component. The problem is that the interface specification can change with every update and the susceptibility to errors increases. Disrupted data exchange and system failures can impair critical functions and paralyze operational processes.
• Maintenance effort
  To minimize these risks, the company itself must take action: After each release, a test phase must be carried out to check whether the data exchange is still working properly. If not, it is necessary to make short-term improvements under time pressure. For IT, the operation of a data link is therefore also associated with effort. The more applications are connected, the greater this effort.

An integration framework is an extremely effective solution for connecting ERP and third-party systems.

3. declarative integration frameworks – the smart solution

Neither standard interfaces nor new developments are therefore the optimal solution. How good that there is a third option for setting up links: so-called declarative integration frameworks. These can transform the communication formats into the respective target format in a semantically correct way. This is possible by declaratively mapping the individual interface data points of both communication partners. The prerequisite is usually that the data within the interface is available in a specific format – for example XML or JSON.

Companies usually pay an additional license fee for declarative integration frameworks. However, they benefit from several advantages:

• Less effort
  Customization programming is not necessary. This saves companies the time and expense of planning and developing individual interfaces.
• Simple maintenance
  Maintenance and servicing of the integration are also possible without programming and without a new release of the software. ERP users can make changes to the data structure of an interface independently. In addition, the framework is part of the ERP solution and therefore covered by patches from the ERP manufacturer.
• More flexibility
  Business users can easily change the configuration of an interface without involving IT. This means that the technical factors of ERP integration take a back seat, allowing processes to be designed more efficiently.

Tips for successful integration

To summarize: an integration framework is an extremely effective solution for connecting ERP and third-party systems. However, it is not always possible to use an adapter. For example, if the software system does not have its own programming interface, companies have to develop a solution themselves or commission one. This may be the case for in-house developments or industry-specific niche applications.

In addition, interface frameworks reach their limits when exchanging particularly extensive data records. In this case too, a certain amount of programming is required. So to avoid any surprises during integration, good preparation is the be-all and end-all for flawless networking.

If you take the following tips into account in advance, you will be on the safe side:

1. proceed step by step: Plan carefully

• First define your requirements and goals.
• Carry out an analysis of your data structures.
• Determine which systems you want to network with each other and prioritize them.
• Find out which interfaces you need and which connection options are possible.
• Carry out a step-by-step implementation, including a test phase, to minimize risks and reduce interruptions to operations.

2. think future-proof: focus on flexibility

• If possible, use standard interfaces or interface frameworks in order to be able to react quickly to new technologies and process changes.
• Take future growth into account and rely on scalable infrastructures.
• Ensure regular updates and maintenance to ensure compatibility with new technologies.

3. choose the right partner: expertise counts

• Choose an experienced, seasoned integration partner with the necessary technical expertise. This will ultimately save you time, money and stress.
• Make sure that the partner is familiar with the relevant technologies, standards and your systems.
• Choose a partner who responds to your individual requirements and offers innovative, future-proof solutions.
• Check the provider’s support services to ensure a sustainable partnership.

Conclusion: Integration frameworks preferred

You should only consider complex individual programming if the software to be connected does not have a programming interface. The ideal solution is an integration framework that acts as an adapter between the ERP system and the external system. This allows specialist users to set up interfaces themselves quickly and cost-effectively – without any programming effort.

You should discuss with a competent ERP provider whether an integration framework is also suitable for your system landscape. Especially if you want to network several external systems with your system, it is best to discuss this option when selecting an ERP system . This ultimately determines which solution is best suited for your purposes.