By Michael Burns
Back in 1998, when we ran the first CAmagazine enterprise resource management survey, most readers had no clue what ERP was all about. Now it would be hard to find one who doesn’t know hard to find one who doesn’t know something about it. In fact, CAs are often the decision-makers for ERP. Vendors have also come to recognize the survey as a major source of information about their products. That is probably why our survey chart has grown from just a handful of systems in the beginning to an eye-popping 88 today. This number includes everything from small, relatively unknown companies to large, well-known vendors. Small companies typically specialize in a vertical industry and have a way of distinguishing themselves from the major vendors.
The survey results are available in the form of a PDF as well as an interactive chart that allows you to compare up to four systems at a time. You can also ask 180 Systems to select the top 10 ERP systems that meet your requirements based on percentage-fit calculations. For all these options, visit www.camagazine.com/ERPsurvey12.
This year we have added more functionality to the survey, including questions about ease of use, multiple companies, workflow, mobile applications, cloud readiness, browser support, dashboards, online analytical processing, back-order fulfillment, available to promise, multisite production, customer relationship management and ecommerce.
As always, we have segregated the ERP products into tiers based on customer revenue and employees and product cost. This is a convenient, albeit not perfect, means of differentiation. Be cautious if you’re trying to calculate the costs for a system, since these numbers are just averages.
For the past 12 years it has been a buyer’s market for ERP systems. But today business has picked up and vendors feel less compelled to sweeten their deals. I consider ERP vendors to be a bellwether for the economy because organizations usually don’t invest in their systems unless things are going well and they are confident about the future. So what’s good for the ERP vendors is good for all of us.
As in 2011, cloud computing is a high-flyer on the list of ERP trends. In fact, one vendor recently told me that companies are now more interested in acquiring software via the cloud than in buying licences and having the solution installed on site.
For ERP systems, there are two types of cloud formations. With the first, often referred to as software as a service (SaaS), multiple customers share the same servers using multitenant architecture. This makes it easier for vendors to manage customers because they just need to update the software once for all the customers sharing the same servers. The second formation is more like a private cloud, where the vendor has your ERP application on a server that it manages/hosts for you. You can also add other applications, such as Microsoft Office, to the server. The difference can be quite confusing, and so can the terminology. My solution is to refer to these two options as shared cloud networks (SCN) and private cloud networks (PCN).
Most ERP vendors are now offering either SCN or PCN solutions. PCN has some advantages in that the ERP software does not need to be rewritten for SaaS and multitenant architecture. Also, the software can be customized for specific needs. However, SCN has (or should have) a cost advantage: it is a lot easier to maintain one instance of the software for all customers than to cater to each one individually.
Mobile applications are still gathering momentum. It won’t be very long before you will be able to use your mobile device for many ERP functions. Mobile devices are actually powerful computers and the younger generation can enter information into them just as fast as the older generation can enter information into desktops or laptops. This does not mean the computer will be going away, because we all prefer to use large screens when we are working. In fact, two screens are now a must for many of us. Having a dual monitor is probably the least expensive method you can find to increase employee productivity.
The biggest change in ERP over the years has probably been in ease of use. ERP systems are a lot friendlier than ever before. But it’s unlikely they will ever be really simple to use. The whole point of ERP systems is to automate business processes across most, if not all, departments in an organization. And organizations have complex processes.
ERP failures still happen, albeit a lot less than they did in the past. Sometimes the system is not implemented on time, on budget or, most importantly, fails to meet objectives. In these cases, it’s usually people rather than systems that are at fault. So although it’s important to consult the survey for features and functions, make sure you know the people who will be implementing your ERP system. Using a proper/best practice methodology will go a long way toward limiting potential problems. It’s also a good idea to have clearly defined metrics to determine whether the investment was a success.
Michael Burns, MBA, CA.IT, is president of 180 Systems (www.180systems.com), which provides independent consulting services, including business-process review, system selection and business-case development. Contact 416-485-2200; email@example.com