Capitalizing on new digital business models and the growth opportunities they
provide are forcing companies to re-evaluate ERP’s role.
Made inflexible by years of customization, legacy ERP systems aren’t
delivering what digital business models need today to scale and grow.
Legacy ERP systems were purpose-built to excel at production consistency
first at the expense of flexibility and responsiveness to customers’ changing
By taking a business case-based approach to integrating Artificial Intelligence
(AI) and machine learning into their platforms, Cloud ERP providers can fill the
gap legacy ERP systems can’t.
Companies need to be able to respond quickly to unexpected, unfamiliar and
unforeseen dilemmas with smart decisions fast for new digital business
models to succeed. That’s not possible today with legacy ERP systemsThat’s
all changing fast.
A clear, compelling business model and successful execution of its related
strategies are what all successful Cloud ERP implementations share.
Cloud ERP platforms and apps provide organizations the flexibility they need
to prioritize growth plans over IT constraints.
Many have taken an Application Programming Interface (API) approach to
integrate with legacy ERP systems to gain the incremental data these systems
New business models thrive when an ERP system is constantly learning.
That’s one of the greatest gaps between what Cloud ERP platforms’ potential
and where their legacy counterparts are today.
Cloud platforms provide greater integration options and more flexibility to
customize applications and improve usability which is one of the biggest
drawbacks of legacy ERP systems.
Designed to deliver results by providing AI- and machine learning insights,
Cloud ERP platforms, and apps can rejuvenate ERP systems and their
contributions to business growth.
• Enterprise Resource Planning software (ERP) packages are complex systems
that accommodate a variety of business functions across departments such
as accounting, inventory, order processing, purchasing, contact management,
warehouse management and customer communication. Although most ERP
systems will provide similar functionality, due to the complex nature of
sophisticated ERP, it can be difficult to compare them, especially when
evaluating more than 2-3 potential vendors. Aside from basic inventory and
accounting functionality, ERP systems also include features geared towards
specific industries and you will find that there are different types of ERP
depending on whether or not your business is in manufacturing, wholesale
distribution or service. To help you find the fight solution, the following are
several ways you can differentiate between software offerings:
6. Software Tier
• First and foremost, it is important that the systems you’re evaluating are directly
comparable. Trying to compare introductory software such as QuickBooks to true
ERP can become extremely dangerous, as the systems are designed to fulfill
different needs and are appropriate for companies of different sizes and
sophistication. Make sure you fully understand the different Tiers of software available
in the market to first determine which is appropriate for your business.
• Introductory systems are geared towards small businesses as the first solution
implemented in an organization. Introductory systems are typically designed to
accommodate one business process (such as accounting or inventory management)
and will often require integration with other standalone systems to provide
functionality across multiple departments.
• To be considered true ERP software, the system will be able to accommodate a
variety of business processes across the organization. ERP replaces all standalone
solutions as an all-in-one system. Not all vendors abide by the same definition of ERP
as it is technically defined rather loosely. However, there are certain features inherent
in true ERP solutions:
7. • ERP systems share a database
• Information flows between different areas of the software – accounting,
inventory, sales orders etc.
• Information is available in real-time
• The system and installation is elaborate
8. Deployment Method
The deployment method you choose for your business will have an on-going
impact on costs and necessary resources. For smaller businesses, cloud-
based solutions tend to be the better option, but are not always feasible if you
do not have access to a reliable internet connection. On the other hand,
larger businesses can often benefit from on-premises software if they already
have a dedicated team of IT personnel in-house, and the required server
infrastructure. Do your research to determine which method is best for your
business, and make sure that you compare the total costs of ownership
between the two over a span of several years. A vendor that provides both
options gives you the flexibility to switch down the road as your business
9. The People Behind the Software
Many ERP systems are similar in their functionality unless they are designed
for a specific industry such as pharmaceutical distribution software. Where
most systems tend to differ more greatly, is in the people behind the software.
Evaluate your experience with the people behind the company to get a feel for
how you think it will be to work with them in the future. This includes sales
staff, consultants, developers and support personnel. The easiest way to do
this is to start by evaluating the person you work with during initial sales
discussions. Are they attentive to your needs? Are they personal and put your
business needs first? Do they understand your industry? Do they ask the hard
questions and sometimes say “no”? ERP is designed to grow with your
business and so it is important that you’re happy with the people behind the
software for when it comes to dealing with after-sale support, customization
projects and upgrades. Ask the vendor to speak with existing customers to get
a feel for their experience
10. The Price
• Another obvious, but dangerous, means of comparison is the price. Certainly,
the price is very important in making a decision but always be careful. Low
costs may be attractive but could also be the result of low-ball figures or an
initial discount, which means you might end up paying more down the road.
High costs are usually a safer bet in terms of functionality and conservatism,
but you may be paying more than you need to. ERP solutions within the same
tier will have comparable price points so instead, the art is finding a balance
between low and high and understanding what the appropriate price is based
on the market. Keep in mind the price is not just about what you pay for
software, but also the cost savings you will gain from having a system that can
automate processes and increase efficiency.
11. Meeting Your Needs (Customization and Software
Software flexibility is a great way to compare software. Some vendors offer a
“canned” piece of software that is rigid and cannot easily be adapted to your
specific business. No two businesses are exactly alike and so it is important to
find a system that is able to adapt to your unique needs.
However, implementing a completely customized solution is also not the best
approach. Ultimately you want a balance of both built-in functionalities specific
to your business and industry, and flexibility through customization.
12. Artificial Intelligence Within ERP Systems
AI allows ERP vendors to improve ERP systems using machine learning and
natural-language interfaces. The AI in ERP systems provides actionable data
insights enabling companies to improve their operational efficiency
A good example of an AI-driven ERP solution is SAP Leonardo, which
includes a number of microservices integrated with a cloud platform. Oracle
also has introduced a number of AI-based tools for its ERP solutions, including
digital assistants, advanced access and financial controls, and smart supply
13. Company History and Current Standing
• Look at a company’s history to determine viability. The longer they have been
around the better – keeping in mind that ERP software has only been around
since 1990. Also, bigger is not always better as large companies have been
known to dump software products fairly frequently, forcing upgrades or
software upheavals. Instead, look at the company’s success stories, determine
the frequency of updates and be sure that the company is constantly adding to
the system instead of winding it down. And better yet – talk to it’s customers.
• In summary, the best way to compare ERP software is to review the following:
(1) software tier, (2) deployment method – cloud vs. on-premises, (3) the sales
team, consultants, support staff, developers and management of each
solution, (4) the cost, (5) the ability to customize the system, and (6) each
software vendors company history and current standing – is the software in
question still being developed and updated?
14. How to Evaluate ERP Vendors
• Customer Satisfaction
• One of the best ways to get an accurate picture of how a vendor treats its
customers after making the sale is, logically enough, by speaking with current
customers. Try to speak with multiple references in your industry or those who
have similar business processes, and perform background research on the
vendor’s implementation history.
• Sales Process
• Sales processes often vary significantly from one vendor to the next, but some
red flags can be raised during the process. Do they truly understand your
business needs? Have they been rushing you to a demo without adequate
preliminary discussions to find out your needs? Purchasing software is a large
investment and should be treated as such. It is not a decision that should be
15. • Support
• Support can sometimes be the deciding factor when it comes to choosing between
vendors. Some vendors may provide 24-hour support and international support in
multiple languages where others may not. However, larger businesses with 24-hour
support often outsource this process, decreasing personalization. Weigh the pros
and cons of personalized support vs 24-hour support.
• ERP software costs should be somewhat similar across comparable vendors. If one
system seems to be significantly less expensive than the rest, further information
should be gathered to determine why this is. Are similar components included? Are
some costs hidden in the fine print? Is the implementation and training process less
thorough or more restrictive? Watch for deceptive tactics sometimes employed to
close a sale — often through low-balling or providing inaccurate cost information.
19. TIER 1:
1. The Tier 1 ERP solutions are basically SAP andOracle
2. They are designed to service the needs of Fortune 1000 companies, which
for the most part are complex, large businesses that have many departments
and global locations
3. Revenues are typically in measured in billions
4. Tier 1 ERP solutions generally take a long time to implement and are
equipped with a wealth of features at a pretty high price.
20. TIER 2
• 1. Tier 2 ERP systems fit well with mid-size companies
• They can be installed and supported by local partners and offer a lower
• Total Cost of Ownership
• 3. The Tier 2 market is the largest of all the tiers in terms of the number of
21. TIER 3
1. These products do not offer the functionality of Tier 1 and 2 solutions
2. We get basic accounting abilities with these small business tools.
3. They have a low TCO and are easy to implement.
22. Cloud ERP with AI and Machine learning
Amazon has successfully partnered with automotive manufacturers and has
the most design wins as of today.
They could easily replicate this success with machinery manufacturers.
23. ERP Pricing and the Cloud
• ERP has been around as a software category since the late 1990s. In that
time, it's evolved in a number of important ways, most notably that many have
become cloud-enabled. The benefit to customers here boils down primarily to
cost and scalability.
• Because ERP systems are modular, traditional ERP systems often required
multiple servers to fully function. There may be one server for the financial
module, one for the back-end database, one for the inventory management
system, and so on. Now tack on redundant servers for reliability and increased
performance and you're soon looking at a hardware and infrastructure price
tag that can exceed the cost of the software. To market this technology
effectively to SME customers, vendors are using the cloud to power their
solutions and the Software-as-a-Service (SaaS) model to deploy it.
24. • That means customers have very little (often zero) upfront hardware costs—all of the
servers are in the cloud. That can be a huge reduction in overall total cost of
ownership (TCO) of an ERP solution. But, as an added bonus, this deployment model
also allows for immediate and highly cost-effective scalability. If your business runs a
web retail operation, it might opt for an e-commerce module in its ERP solution. But
during the holiday season, traffic through the e-commerce system might spike. In a
traditional infrastructure setup, that company would need to purchase extra servers
and configure them as redundant clusters to handle that increased traffic. Then, when
the holidays are over, those servers would simply be shut off and the company would
have to eat the cost of an unused hardware investment. Via the cloud, customers can
simply spin up new servers in the cloud to handle this increased load, pay for use
only during the holiday period, and then dissolve them once the holidays are over
(thus paying only for what they need when they need it).
25. Featured ERP Software
• Oracle NetSuite OneWorld
• Pros: Solid customer relationship management features. Broad enterprise
resource planning features apply to wide variety of businesses. Excellent
drilldown capabilities from several system views. Simple reporting. Custom
process workflows. Easily navigable, hierarchical dashboards.
• Cons: Confusing help system. Difficult to configuring system for specific roles.
Broad but complex feature set.
• Bottom Line: Oracle NetSuite OneWorld is written for the cloud, focusing on
ease of use and modularity. It is a solid financials platform that can be easily
expanded to meet other business needs simply by buying additional
functionality through the cloud.
26. Acumatica Review
• Pros: On-premises or cloud deployment. Robust amount of costing methods.
Works on many databases. Solid reporting. Non-user-based pricing
accommodates growing companies. Browser-based app makes it easy to use
mobile devices. Navigation is easy.
• Cons: Estimating licensing costs can be difficult. Standard report filters may
need customizing. Reliance on third-party add-ons needed if implementing
ERP for companies outside the manufacturing/distribution vertical. Unusual
• Bottom Line: Acumatica's intuitive design, enterprise scalability, and flexible
pricing model help make Acumatica an excellent choice for enterprise
resource planning, general ledger accounting, and inventory management.
27. Open Systems Traverse
• Pros: Deep dashboard drilldown. Full suite of ERP creation modules. Good
documentation and Help screens. Available in-house or hosted. Includes
Working Trial Balance report. Screen, forms, and reports customization. Easy
hosted mobile access.
• Cons: No Flowchart/Process navigation. Setting up data entry and reports is
• Bottom Line: While Open Systems Traverse is one of the oldest players in
the space, it actually shows its age in areas like UI design. Still it's a solidly
capable mid-tier financial platform that's well worth a look
28. SAP Business One Professional
• Pros: Extensive customization available. Underlying SAP HANA database
allows for complex business analytics. Microsoft SQL Server also available.
Includes Crystal Reports for custom reporting. Can handle multiple currencies.
Benefits administration module. Excellent documentation.
• Cons: Initial configuration and installation usually requires partner or
expensive Value Added Reseller (VAR). Extensive customization necessary.
Only supports Mozilla Firefox browser; testing failed. Ancillary system
applications such as HR have pared-down feature sets.
• Bottom Line: SAP Business One Professional has good features and
flexibility overall, but is designed as an "old school" enterprise resource
planning (ERP) platform. It may be too complex for many users especially
small to midsize businesses (SMBs).
29. Sage 300
• Pros: Mobile access from multiple operating systems using Google Chrome.
CRM available in the 300 product line. Easily changeable dashboard widgets.
Customizable, ribbon-based navigation menus.
• Cons: Payroll and inventory unavailable as 300 components. No hard
timetable for adding modules. No flowchart/process navigation. Limited
dashboard widgets on screen. Missing drill-down or navigation capability.
• Bottom Line: Sage 300 is a mid-range accounting and enterprise resource
planning (ERP) software solution that is easy to use. But its functionality and
expansion modules are limited, and it lags slightly behind the competition in
drill-down and customization features.
30. Microsoft Dynamics 365 for Finance and Operations
• Pros: The Business edition offers extended capabilities and features. Can
produce sales estimates and invoices in Microsoft Outlook, which is reflected
in the accounting system automatically. Launch screen offers a clear view of
critical key performance indicators, open items, and company data, including a
summary trial balance. Very tight Office 365 integration.
• Cons: Lacks comprehensive customer relationship management,
payroll/human resources, and project management features. Only available in
US and Canada. Only inventory costing method is FIFO. Process flowchart
navigation is lacking.
• Bottom Line: Microsoft Dynamics 365 for Finance and Operations, Business
Edition is a cloud-based accounting system that's tightly integrated with Office
365 and other Microsoft cloud applications. It's a solid offering that's easy to
navigate, but some small to midsize businesses may find it lacks particular
features they need.
An ERP system has a huge impact on the success and growth of organization so
it's important to follow a detailed selection process when choosing your system.
Manufacturing growth today is being empowered by ERPsoftware.
In fact, ERP is driving manufacturing growth in four keyways: Collaboration,
Responsiveness, Simplicity, Mobility
Deployment Method-This will impact on cost of installation and resources needed.
For smaller business, cloud based solution tends to be better.
The People behind the Software
Meeting Your Needs (Customization and Software Fit)
Company History and Current Standing