In many small and medium-sized enterprises, there is a dangerous misconception: “Our ERP system defines our processes.” Instead of defining, documenting and standardizing their own processes, companies often allow their software system vendor or the system’s limitations to dictate how work is done.

But the fundamental truth is this:

1. The software system must follow the company’s processes – not the other way around.
2. A process is the intellectual property of the company, while the software is merely a tool that executes it.

When processes are not clearly defined in-house, someone else ends up defining them on the company’s behalf.

This undermines strategic autonomy and prevents leadership from exercising control over how the company actually operates.

Many companies rely on locally-developed systems created primarily to meet domestic regulatory requirements or reflect local business habits. These systems often lack:

1. globally aligned process logic,
2. standardized modules based on international best practices,
3. scalable, integration-friendly architecture,
4. the accumulated process knowledge of thousands of companies across industries.

The consequence: A company using such software system effectively isolates itself from global process knowledge and innovation.

For comparison:

Eg. leading global ERPs (SAP, Microsoft Dynamics, Oracle NetSuite) embed the process experience of companies worldwide. Local ERPs typically reflect the habits of a few hundred domestic users.

Choosing a purely local system is, in practice, declining access to global know-how.

Management science is clear: organizations without standardized processes cannot grow without proportionally increasing headcount, meaning they lose scalability.

Without clear ownership of processes, companies face:

1. operational inconsistency (“everyone works their own way”),
2. an inability to automate due to unstable process logic,
3. overlapping responsibilities,
4. dependency on key employees (“if this person leaves, everything stops”),
5. difficulty implementing new technologies.

Digital transformation is first and foremost a process project, not a technology project.

If the process is unclear, no technology can fix it.

Vendor lock-in is one of the most dangerous risks for business owners. This occurs when a company becomes technologically and operationally dependent on a single vendor.

This is especially common when:

1. the ERP includes PIM, CRM, webshop, manufacturing, document management and other modules,
2. and all these modules are developed by the same vendor with limited specialization or global methodology.

Monolithic architectures create:

1. inability to replace individual components (e.g., implementing a modern PIM or webshop becomes impossible),
2. sky-high upgrade costs, since only one vendor can make changes,
3. painful and risky customization efforts,
4. loss of strategic independence, as the company no longer controls its own roadmap.

In effect, the owner becomes a guest in their own IT ecosystem.

In mature organizations, the software system functions as a repository of accumulated business knowledge - process standards, controls, workflows and reference procedures. This enables:

1. consistency,
2. measurability,
3. repeatability,
4. reduced reliance on individuals.

However, this only works if the software system reflects global best practices. Otherwise, it does not capture knowledge - only local habits.

Many leaders believe their company is “too specific” to adopt global standards, but reality is the opposite:

Implementing global standards enables companies to scale, export, innovate and grow.

Investors, private equity funds and strategic buyers increasingly evaluate companies based on digital maturity and process standardization. Companies that fully own their processes achieve significantly higher valuations.

Why?

1. Lower acquisition risk – standardized processes mean the business is not dependent on key individuals.
2. Predictability and scalability – a clear foundation for future growth.
3. Lower integration costs – digitally mature companies fit more easily into group software systems and governance models.
4. Technological independence – reduced exposure to vendor lock-in.
5. Processes become intellectual property – considered part of the company’s intangible assets.

It is not uncommon for global buyers to offer 15–30% higher valuations for companies with:

1. standardized process governance,
2. modern modular IT landscape,
3. documented workflows,
4. clear accountability frameworks.

Simply put:

Process and digital maturity directly translate into higher enterprise value.

When leadership becomes the owner of business processes, several transformative changes occur:

1. The organization becomes proactive instead of reactive.
2. IT supports the process—IT does not define it.
3. Automation and scaling become achievable.
4. Roles and KPIs become clear and enforceable.
5. The company stops “firefighting” and starts managing strategically.

Process ownership forms the foundation for:

1. lean management,
2. quality systems (ISO and beyond),
3. digital transformation,
4. international expansion,
5. investor readiness and M&A preparation.

A company that does not own its processes does not own its future.

A company that lets its software system define how it operates effectively relinquishes control to a vendor.

A company without standardized processes cannot automate, measure or scale.

Boards and owners must take ownership of processes for three core reasons:

1. Control and independence – processes are intellectual property, not software features.
2. Growth and competitiveness – standardization enables quality, automation and scalability.
3. Increased enterprise value – digital maturity drives higher valuations.

When leadership defines and owns the processes - and software systems merely execute them - the company stops depending on vendors and becomes the true architect of its own growth.