We just blogged about SMBs' growing interest in ERP and the efforts of big vendors like SAP and Microsoft to appeal to that interest. Then we encountered some statistics on IndustryWeek that show why so many SMBs seem ready to invest in ERP.
According to the Aberdeen Group, 14 percent of SMBs do not have an ERP system. The ERP systems of others are getting pretty creaky -- older than 10 years for 20 percent of SMBs and five to 10 years old for 31 percent of SMBs.
A solution that may appeal to many SMBs is hosted ERP, a model exemplified by Workday, a company recently launched by several former PeopleSoft executives.
In this mini-case study of a manufacturer using a hosted ERP solution from Glovia Systems, also in IndustryWeek, the company uses the product for purchasing, inventory management, MRP and support for a range of financial operations.
One of the biggest benefits, says a company executive, was that the product took IT troubleshooting off his lead engineer's crowded plate, freeing him for more strategic tasks. The company's previous on-premises system was costly and expensive, he says.
While the SaaS model has definite advantages, including reduced capital investment and the reallocation of resources mentioned above, some experts contend it's not the right choice for tasks that involve lots of company-specific processes -- which is certainly the case with some ERP systems.