New Challenges for Enterprise Resource Planning (ERP)
Many of the big players of enterprise software like SAP, originated as niche solutions for large corporations, focused on manufacturing, financial management, HR and the like. It has been 30 years since the inception of ERP and now they are defined by their ability to manage every internal and external resource of an organization.
Since this market is controlled by a relatively few global players, implementing and maintaining ERP is an expensive business. With IT budgets being reduced in order to save costs, only financial services, the public sector and service industries are continuing to invest.
Even markets that are expected to hold, pharmaceutical companies for example, went in for serious cost cutting. There is heavy pressure for ERP vendors to face the challenge of possible stalled growth.
An important factor for ERP decision-making is that the application is user-friendly for all levels of users. The user interface is what matters as customers are keen to drive out costs of what they see as burdensome legacy systems. Traditionally, retailers looked to ERP vendors to provide core transactional systems for strategic solutions such as supply chain and BI tools. More recently they look for ERP systems for most core functionality and point-providers for unique or strategic applications to solve specific ERP challenges. There may be a split in business flow from ERP and SaaS in the future, thus HR, payroll and the like could be outsourced as web, cloud computing or SaaS; but always on the basis that the customer owns and controls them.
For new entrants in the ERP market, cloud computing is a route for many of them. Even established players are also taking advantage of the way this market is opening up. But don’t expect ERP to be the next big thing in the cloud; you will see a lot of attractive services integrated in the ERP platform but everything can still be orchestrated from your platform.
No doubt that implementing and maintaining ERP is an expensive business.so, its not economical for small and mid-sized enterprises.Because at present the market is driven by few global players. And things may change ahead with new players entering the industry.