ERP Vendors 

ERP Vendors Tapping Into SaaS or Software as a Service ERP Applications

In the not so distant past, companies had limited options when it came to ERP Vendors and products. ERP or enterprise resource planning software option were only developed by less than a dozen of vendors and product offerings were slim. The dominant vendors back then were only three, namely SAP, Oracle and IBM. The ERP vendor giants targeted the largest of the large Fortune 500 manufacturing companies with limited industry sectors, so if you were not in the ERP vendor's software target sweet spot with respect to industry or type of business you faced an uphill battle trying to get the enterprise application to work with your business processes.

In the past 10 years, on premise ERP solutions have increased their product offerings to target and work with midsized companies to capture this huge market opportunity. Companies of virtually any size now have a significantly wider array of on premise ERP software solutions and ERP vendors to work with than ever before with solutions that better fit their individual businesses.  The ERP industry has also dramatically innovated with new web based product such as software on demand applications or SaaS, software as a service solutions that have been skyrocketing in demand from companies of every size and capturing significant market share from on-premise ERP vendors with robust solutions that are easy to use, easy to deploy, and significantly more affordable.

SaaS solutions are gaining a strong following and installed base because companies, particularly smaller to midsize businesses can deploy an ERP solution in literally one day and enjoy the state of the art robust features and technology benefits that are on par or exceed any application on the market today with minimal IT resources and capital cost requirements. Through a hosted, subscription based model, companies using the application can focus on their business rather and enjoy ongoing application enhancements and software improvements in real time. Software improvements developed in one subscriber can be shared with all subscribers in real time without requiring companys to disrupt their business or incur additional expenses with software upgrades.  This significant benefit as well as the outsourcing of application maintenance and upgrades are key reasons for the popularity of web based solutions.

A SaaS based ERP vendor does not require additional IT hardware or resources to implement and deploy the solution or software updates including annual maintenance fees. With on premise ERP systems particular the big ERP application like SAP, Oracle, Microsoft Dynamics, IBM and amongst others, yearly maintenance costs and enterprise application upgrades end up costing more than the ERP software after a few years.

For smaller businesses, it gives the user the opportunity to finally enjoy the benefits that an ERP solution can deliver to an organization by eliminating the major capital requirement hurdle. However, note that SaaS ERP vendors are indeed entities just like on premise ERP vendors so managers in charge of ERP software selector for their company should be very clear on what the full costs of subscriptions will be for a web based system currently and in the future given company growth expectation and the new user seat projection. Usage fees may increase and exceed original planning expectations and budget levels if a sales organization expands, or other departments want additional seats to use the web based application.  Similar to the on-premise ERP solutions, once a company has settled in a SaaS based application, it is a difficult and disruptive process to go with another vendor, SaaS based or on premise.

In summary, for smaller companies in particular, SaaS based system should be considered as a real viable enterprise application option. For many companies web based ERP vendors and solutions may be the only affordable solutions for many companies to take advantage of the benefits of ERP solutions and compete in the marketplace.

Written by :

aniseo