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Enterprise resource planning (ERP) software was originally developed for large organizations to manage their entire operation from a single software console. During their early days, they required loads of on-site servers and lots of individualized software customization. Today's ERP implementations, however, are mostly delivered as cloud services, which makes them not only accessible but even attractive to small to midsize businesses (SMBs). Largely for this audience, we've reviewed 10 enterprise-level general ledgeraccountingsoftware solutions from vendors that are also able to extend their product suites to full ERP functionality.
These suites are designed in a modular fashion for the most part, which means you're able to purchase only the features your company needs. The suites are also squarely aimed at the small to midsize enterprise (SME) market. Typically, we review products that are aimed either at SMBs or enterprise organizations. The SME designator is less an indication of size than of the complexity of the business.
To make an investment in ERP software worthwhile, a business should have a need for custom business processes, multinational commerce, fairly complex manufacturing, or complex supply chain requirements. That's where SMEs become the better indicator rather than SMBs. A SME can still be roughly the same size as a high-end SMB (figure SMEs will typically grow between 100 and 1,000 employees), but it's a business with enough complexity and high-end requirements that will make the move to ERP a good investment.
What Is Enterprise Resource Planning (ERP)?
ERP generally describes a modular software solution that incorporates the financial side of the business and then adds closely integrated app modules that address other areas of the business, including business intelligence (BI),customer relationship management(CRM), Materials Resource Management (MRP), and Supply Chain Management (that is, logistics). MRP includes capabilities such as fixed asset management, Just-in-Time (JIT) Inventory,point-of-sale(POS) systems, and project management.
In essence, ERP is a systemic approach to managing the entire enterprise, not just its finances. By integrating all of these modules into a single, cohesive whole, customers can gain new insights and create new processes that weren't possible using separate tools.
For example, most ERP systems also enhance accounting and overall management by adding features or capabilities to enhance a basicpayrolltool into a more comprehensivehuman resources(HR) management framework, or to expand inventory management to more closely adapt to the specific type of business the customer operates, such as companies that center around warehousing or distribution.
Sometimes More Is Better
When looking at a company's management information systems portfolio, it's sometimes not obvious that a generic app may not be the best approach. A good example of this is payroll. The payroll for a service organization, for instance, incorporates time and billing and possibly expense management; it's considerably different from the payroll that should be used for a food and hospitality organization, which requires that the company track employee tips. And that's very different from payroll for a construction company, which often requires multiple rates for the same employee depending on what job they're performing (and also has to report to multiple unions).
Inventory is another area in which needed functionality differs depending on the type of business. For example, the inventory for a manufacturing company might require component tracking using bar codes to identify parts bins as well asBill of Materials Processing(BOMP) that provides a list of all the parts and subassemblies needed to construct a particular product, or even Kitting, which consists of inventorying and tracking subassemblies rather than discrete parts.
The point is, because ERP platforms are (a) modular and (b) so broad in terms of the situations they address and the features they provide, the planning process for choosing the right ERP solution begins at home—long before you actually speak to a vendor. You need to start your selection process by sitting down with the front-line managers of all your key business processes, and mapping out exactly how your company does business. Exactly how do your web customers go from a credit card transaction to a shipping box arriving at their front door? How are payments processed, orders fulfilled, warehouses managed, inventory moved and tracked, and shipping orders picked up and delivered? How is all of this information used to provideongoing BIfor the organization? What kinds of information aren't you getting that you really need? The list of appropriate questions will get much deeper in the real world and extend far beyond the typical IT questions that get asked before installing SMB software (such as servers required, per seat licensing costs, etc.), though those questions still apply to ERP as well.
The reason you need to get a comprehensive understanding of how your company does business is because ERP systems not only run the gamut of business process features (as discussed earlier) but they also provide varying degrees of integration between their various modules. With standard SMB software, it's rare to find direct feature synergies between warehouse management and the HR framework, for example. But with an ERP system, not only can that be possible but you can also tweak that integration to work even more effectively for your organization. For specialty warehouses that store specialized inventory (like dangerous chemicals, for example), your HR system can automatically kick in its shift-management capabilities to make sure that, when such chemicals arrive at a particular warehouse, the right staffers who have the skills necessary to handle those chemicals are there to receive and store them.
That's just one example out of myriad possibilities. What's possible for your organization is entirely dependent on the capabilities of the ERP platform and how well you understand how your business really runs.
Lose Some, Gain Some
In our initial review of the software suites, we looked at the financial side, concentrating on the general ledger and examining overall usability, navigation, and workflow. In this cycle, we went back to each vendor's offering and examined it for overall ERP functionality and the availability of modules that enhance the financial management aspects of the system (and extend it into other areas of enterprise operations).
In doing so, we made some changes in the vendors and products covered. In the initial set of financial accounting reviews, we included bothIntacct(Visit Site at Sage Intacct)andIntuit QuickBooks Online Plus. Neither of these has a true ERP edition so we excluded them from this round of reviews.
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.
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).
A final cloud benefit is licensing cost. In an on-premises model, your company would pay for an initial setup fee and the "X" dollars (usually between $1,000 and $5,000) per user or seat. That license would extend and generally last until the software was significantly upgraded. In a cloud model, the initial setup fee either doesn't exist or is typically much smaller, and the licensing costs are assessed at "X" dollars per user per month (typically anywhere from $90 per user per month up to $500 per user per month). For those who carefully do their math, this type of subscription-based licensing can be significantly cheaper than a traditional on-premises, per-seat scheme.
One area in which you likely won't save money over standard on-premises ERP deployment is the third-party partner. Most of the vendors we tested require (or at least strongly suggest) that you purchase and implement their software by using a third-party, value-add partner. This entity will manage the purchase, the initial deployment, and (most importantly) the initial configuration, which, for some of these platforms, can span several months up to a full year. That's because it's the partner who does the hands-on work of customizing these platforms so they work as they need to for your particular business. They interview those front-line business managers (if you haven't already), they do custom coding or scripting to build middleware connections between modules if the right ones don't exist out of the box, they make sure the right features are switched off or locked down; and they handle ongoing maintenance, troubleshooting, and employee training. All of that costs significant additional dollars, which can certainly equal or even exceed the cost of the software, depending on how you're paying for it. So, make sure that (a) you really need a third-party partner to set up your software, and (b) you get an accurate estimate of what their services are going to cost you.
The lesson is clear: Do your homework before attempting to evaluate any ERP system. Chances are you'll work with a reseller to manage the fit between your company and the software. But the better you understand how your company operates and where the potential bottlenecks and problem areas in an implementation will be, the smoother the process will go. The smoother the process, the more effective the final installation will be.
Oracle Cloud ERP versus SAP
Only Oracle offers the most complete suite of cloud applications.
And overall, both SAP and Oracle ERP software do this well. But Oracle stands victorious. Oracle simply has a more comprehensive financial suite with better budgeting, pricing and core accounting tools. All other features were rated equally by our analyst team (except for HR, which SAP held the upper hand).
SAP is the most demanding ERP system nowadays as it has several benefits over other ERP systems. SAP ERP software supports organization to integrate and simplify their various business processes such as finances, HR, manufacturing, and other operations.
What ERP system does Amazon use? The simple answer is SAP. Amazon switched to using SAP software when they could not meet their long-term goals with their then existing system.
Sage 300. Sage 300 is a mid-range accounting and enterprise resource planning (ERP) software solution that is easy to use.
Google Cloud has an ongoing partnership with SAP to provide SAP-certified infrastructure for all of your SAP systems. You can even choose Google Cloud to power SAP cloud offerings, like SAP S/4HANA Cloud, SAP Ariba, SAP HANA Enterprise Cloud, and the SAP Cloud Platform itself.
- TIBCO Software.
NetSuite is a strong competitor of SAP which helps you run your key back-office operations. NetSuite ERP helps organizations to accelerate growth and drive innovation. Their solutions are tailored for businesses of any size, any industry, suitable for employees in different roles.
Despite Oracle's revenue base being higher than SAP's, SAP's revenues have increased by 26% from $24.4 billion in 2016 to $30.6 billion in 2019. This is much higher than the 4% increase in Oracle's revenues during the same period from $37.7 billion in FY2017 to $39.1 billion in FY2020.
When considered as a percentage of a company's annual revenue (or budget, for public-sector organizations), SAP is the higher cost option. The average SAP customer spends 4% of its annual revenue on its total cost of ownership, while the average Oracle customer spends 1.7%.
SAP and Oracle are two different vendors and have a clear market share with established product lines.
Implementation of the S/4 HANA is an overwhelming process and many-a-times it has failed miserably, some even ending in multi-million dollar lawsuits. Today, we will be looking at the top 5 monumental S/4 HANA failures that will definitely go down in history as epic ERP implementation failures of all times.
SAP is so popular among enterprises because businesses can get an all-inclusive set of integrated, cross-functional dealing processes with it. Therefore global businesses of all sizes are biased toward selecting SAP for their businesses.
Oracle Fusion Cloud ERP is a complete, modern, cloud ERP suite that provides your teams with advanced capabilities, such as AI to automate the manual processes that slow them down, analytics to react to market shifts in real time, and automatic updates to stay current and gain a competitive advantage.
The ERP applications market includes both ERP Financial Management & ERP Services and Operations applications. Last year SAP led the pack with a nearly 7% market share riding on a 5.2% jump in ERP license, maintenance and subscription revenues. Oracle was #2, followed by Intuit, FIS Global and Microsoft.
- SAP. The SAP systems featured in the report include SAP S/4HANA, SAP Business One, and SAP Business ByDesign. ...
- Oracle. The Oracle system featured in our top 10 ERP systems report is Oracle Fusion Cloud Supply Chain & Manufacturing. ...
- Microsoft. ...
- Infor. ...
- Oracle NetSuite. ...
- IFS. ...
- SYSPRO. ...
Many manufacturing companies rely on Excel for all sorts of tasks, from scheduling to inventory management to data analysis, because it is readily available, easy to use, and is seen as a cost-effective solution for organizing and planning business operations.