Proof of Pudding in ERP Fact Finding Report and Predictions for 2016

Jan, 04. 2016



It is that cliché time of the year when everyone jumps on the bandwagon, reviews the last 12 months in terms of what has been happening in ERP Land and proffer their predictions for the next year but more of that later…..

When Panorama Consulting Solutions recently published their annual Clash of the Titan’s Report  there was no doubting the quality of the content, nor questioning the accuracy of the data.  It does, however, beg the question of why they compare the ERP market by Vendor and not by Product ….?

Show me the Money
For starters, off the top of our heads we can think of at least 7 different ERP products from Infor, 4 from SAP, and 5 for Microsoft.  With continuous acquisition and vertical market specialisation, just between SAP, Oracle, Infor and Microsoft there are literally dozens and dozens of ERP products.  Unless you are comparing apples with apples – how can you truly compare Implementation Time or Total Cost of Ownership??

There is a plethora of information from Industry Analysts and the likes of Gartner about market share; growth of cloud implementations;  top 10 or 20 ERP vendors (and, by the way, no list is ever the same); buyers guides with feature comparisons; on-premise vs hybrid vs cloud; Tier I and Tier II vendors but absolutely nothing on actual Sales Revenue! 

ERP Fact Finding
Surely the ERP market is sophisticated and mature enough to be evaluated more analytically?  Whilst Microsoft Dynamics AX would be considered a Tier I product, NAV would be considered a Tier II.  Of course, each individual AX sale would produce more $ revenue but the volume of NAV customers worldwide (110,000) is 5 times more than those of AX (20,000) and, one might argue, potentially generate a higher total revenue overall – but this is supposition as the facts are not easily available.

Given the responses in the Clash of the Titan’s Report  came from 519 different companies surely there is an opportunity here to delve deeper into the data and get a more accurate comparative view – even if only from a quantitative perspective.

Try Harder
Try as we might, we cannot find any financial data or breakdown of Microsoft ERP sales by product.  The fact that their successful CRM product is still grouped with the ERP products is surely indicative that the success of Dynamics as a group is mostly due to CRM ….

But the same could be said of the other software houses Oracle, SAP & Infor.  We have extensively googled and trawled the internet for some meaningful data with the only quantifiable nuggets of data being at least 3 years old so and, in this industry that is a very long time ago.

So why is it that the big vendors will not produce a breakdown of their revenue of their top selling products – what are they afraid of or, maybe trying to hide?

Failure is not an Option
Going back to Panorama’s report it is truly sad to note that organisations still struggle to get their software implemented within the project guidelines with problems such as unrealistic timelines, resource constraints and technical/data issues being regularly cited.  We whole-heartedly agree with Panorama’s conclusion:

Organizations that fail to adequately prepare for an ERP implementation, in terms of people and processes, will always struggle to achieve a return on investment from their ERP software – no matter how sophisticated the system”

This is where someone in a project assurance role can oversee the project as a whole, give a birds-eye view from a quality and governance standpoint and help identify these stumbling blocks before they become real issues.

Choice Selection
The market is literally saturated with ERP software and, with industry-specific solutions and vertical markets well-catered for –along with the variety of cloud offerings, SaaS and different licencing modules – there really is a product for everyone but …..

  1. Do not be fooled by marketing literature and think “big software vendor” equals “the right choice
  2. Focus on what makes your business unique and find a product that has that functionality to supports your needs
  3. Check, check and double check that your implementation partner has the resources to implement the system
  4. If you haven’t got the experience in-house of recently implementing ERP systems think about bringing in some outside help with Project Assurance and Governance

Crystal Clear
As for our observations for next year we have two predictions ….

  1. Smaller ERP vendors who have been successful players in a vertical market will be acquired by bigger vendors wanting that market share and specialism
  2. As recent scandals have highlighted the security of any organisation’s software can be compromised. During 2016 we will hear more news stories of large companies being hacked.  However, what we won’t hear about are the increasing numbers of small and medium size organisations that have their data stolen and their business operations disrupted!

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