What Do You Want from Your ERP Supplier in 2009?

Dennis Byron

In looking at the ERP value proposition from a market research perspective, functionality, market penetration, industry orientation, and partnership strategy are the keys. IT managers and staffs look at these same characteristics from their perspective, sometimes after first making an architectural or platform decision, but most often "Functionality rules!" By "ERP Value Proposition," IT Investment Research refers to the advantages of a single database for all business information being updated in real time from consistent user interfaces such that it is theoretically the only piece of business software the enterprise needs. End users such as plant managers and budget planners assume all software offers this value and become very frustrated when they find that standalone application software does not.

 

The characteristics are important to IT staffs for a variety of reasons. For example, a higher market penetration translates to an increasing likelihood that you will find references in your specific industry and size of company classification. The supplier's partnership strategy also helps in terms of industry centricity (and the partner may also be closely tied to a preferred platform such as AS/400 or .NET).

 

The ERP Supplier Comparison, 2009 table illustrates in detail these characteristics in terms of the leading suppliers of ERP software: Infor, Microsoft, Oracle and SAP. Delivery methods such as software-as-a-service or availability in a hosting arrangement are important also, but all the leading suppliers offer all the leading methods, so the differences are less relevant.

 

The suppliers' visions for the future are equally important but since enterprises still tend to turn over their ERP applications only once per decade, you can be pretty sure your supplier will be where you need it by the time you are ready to move.

 


Of the characteristics considered in ERP product research and the value proposition IT is looking for, IT Investment Research thinks industry centricity is the most important to users in 2009. And of course, as in previous years, functionality rules.



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Feb 23, 2009 11:23 AM Todd Todd  says:

I agree.  The value of ERP is difficult to quantify in terms of dollars.  The advantages are so much more than simple ROI.

Of course, you've got to deal with executives who want to know what the dollar value is.  They need to know how much money they'll save.  We've go to learn how to describe the number of man hours spent making decisions.  We've got to enumerate the value of making bad decisions based on poor or late data.

We know the value is there, we just need to be good at describing it.

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Sep 10, 2010 4:57 AM toll free numbers toll free numbers  says:

Well, there are many factors which has to be taken into consideration before setting out for setting a thought on what we want from ERP at the end. Now the year 2010 is almost coming to a close and hence, I must say unlike last year, the insurance of having a strong relation between them does not only solve the case but they need to tie up their shoes a little bit more to ensure others don't have a chance to buy in some of the ERP consumers!    

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Jan 6, 2011 1:05 AM CNA Training CNA Training  says: in response to Greg Ryan

Also...Using ERP will, by its nature, provide improved operational efficiency.  The most important step is, of course, setup.  Knowing the business and its processes will help to get the initial setup started; then seeing how to refine the processes for better efficiency is easier to do.

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Jan 6, 2011 12:52 PM Greg Ryan Greg Ryan  says:

Dcreased costs is a big advantage to using ERP!Using ERP to track costs is like using the seat belt in your car.  It's a tedious thing that we have to remember to do, but if we ignore the tools, we are destined to fail.

If we just take the set of figures from the Average companies in the Benchmark Report, we can see a 12% reduction in Inventory, a 9% drop in operational costs, and a 10% reduction in administrative costs.  If a company is carrying a million dollars in inventory costs, wouldn't a 12% decrease be a welcome sight?

Effectively running an ERP solution doesn't just reflect in Inventory.  Since ERP touches so many aspects of the overall business, cost reductions can be seen across the board including administrative costs.  People spending less time on unneeded tasks-time better spent on things more important to the overall business.

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