Every year, we conduct an independent analysis of the Tier 1 ERP vendors. The report, called Clash of the Titans, is based on data we collect from organizations implementing SAP, Oracle, Microsoft or Infor products.
As we release our latest Clash of the Titans report, we thought we should provide some selection advice that is applicable to the vendors in the report. We call these vendors Tier 1 ERP vendors.
While Tier 1 ERP vendors provide systems suited for a variety of company sizes, their flagship offerings typically are designed for companies with more than $750 million in annual revenue. Most companies of this size have complex processes or complexity around consolidation and entity management.
Clash of the Titans 2021
This report analyzes some of the notable differences between SAP, Oracle, Microsoft and Infor.
Findings from 2021 Clash of the Titans
SAP Compared to Other Tier 1 Vendors
- The most customers focusing on digital business transformation
- The most customers focusing on product data management functionality
- The most expensive ERP projects
Oracle Compared to Other Tier 1 Vendors
- The most use of external resources vs. internal resources
- The most customers focusing on product information management (PIM) functionality
Microsoft Compared to Other Tier 1 Vendors
Infor Compared to Other Tier 1 Vendors
- The most customers using a single-ERP strategy
- The most customers focusing on EAM functionality
- The least customers focused on digital business transformation
How to Select a Tier 1 ERP System
1. Consider Whether the Vendor Would be a Good Implementation Partner
Your ERP consultant will not be your only implementation partner. Your ERP vendor may also be involved in helping you strategize, implement, manage change and support the system after go-live. Some key criteria to look for in an implementation partner are vision, dedication and expertise.
What is Your Implementation Partner’s Vision for Your Organization?
Let’s look at an example to understand what we mean by vision. Let’s say you have a business requirement to print shipping labels from various logistics services before shipments leave your warehouse.
A vendor solely focused on winning the bid might tell you their software can meet this requirement, but a vendor with vision will ask related follow-up questions: Have you considered an integration with carrier services directly to your ERP system? Are you utilizing dock management to best schedule your logistics partners for pick up and drop off times?
Follow-up questions like these can mean the ERP vendor has a vision for what you could achieve with your ERP software. In this example, they are envisioning an integrated ERP system that not only prints shipping labels for your warehouse but also talks directly to your logistics services to know when they are coming and ensures your docks are available for when they arrive.
How Dedicated is Your Implementation Partner?
Dedication is a criterion that’s a little harder to determine. You want an implementation partner that will dedicate time and resources to you when you encounter an issue, despite how many other customers they are supporting.
While Tier 1 ERP vendors have thousands of customers, they still typically offer reliable, long-term support. You can gauge their dedication by thinking back to the RFP process – did you have a dedicated account manager or one whose attention seemed divided?
How Much Expertise Does Your Implementation Partner Have?
The most straightforward consideration in a partnership with an ERP vendor is expertise. Even though Tier 1 ERP vendors have a wide breadth of capabilities that are likely normalized throughout industries, it’s good to ask if they have any specific expertise related to your business.
How Trustworthy is Your Implementation Partner?
Partnerships rely on trust and communication, so it’s important to reflect on your RFP process with each vendor. Were they transparent in their pricing? Did they communicate clearly and follow up in a timely manner? If you have difficulties with trust and communication before you’ve gone all in, imagine the challenge after you’ve already paid the bill.
2. Evaluate the Vendor’s Implementation Approach and Post Go-live Support
When it comes to implementation and post go-live, vendors and consultants can provide external resources. This combined expertise can lead to a successful ERP implementation. However, this requires that both consultant and vendor have a practiced and proven approach.
When evaluating your vendor’s implementation approach, it’s important to ensure it isn’t overly ambitious in terms of cost or timeline.
What Support Options Does Your ERP Vendor Offer?
Post go-live support is another important consideration. While it may seem too early to think about post go-live support before you’ve selected an ERP system, it’s better to know about your vendor’s support plan sooner rather than later so you can make the right ERP selection decision.
An ERP vendor should offer several support options, including a dedicated one. With Tier 1 ERP vendors, a first level of support almost always is included with software licenses. Therefore, a more apples-to-apples comparison is to look at the first level of paid support. How many hours are included? What are the typical service level agreements that come with opening tickets?
3. Focus on Your Differentiating Business Requirements
Tier 1 ERP vendors have a variety of industry-standard business processes built into their software. However, every business is unique, so you will potentially find that one of your differentiating business requirements can’t be me out of the box. You don’t want to standardize these particular processes because they provide competitive advantage, so what now?
This is when it becomes important to ask about customization and integration options.
If you’re implementing SaaS ERP software, it’s important not to go overboard in this area because your software will receive regular, automatic updates that require compatibility. To prevent compatibility issues we recommend asking each vendor what their customization and integration policies are and what this means for you when it’s time to upgrade.
4. Look at the Vendor’s Other Offerings
A unique advantage that Tier 1 ERP vendors have over smaller vendors is that they tend to have other applications in their portfolio that complement their main ERP system.
Internally developed cloud services, for instance, streamline the deployment and management of your IT environment as you only have one vendor to deal with.
Other examples include the Microsoft Office suite of products that can send emails to and from your ERP system and Infor’s artificial intelligence solution that can help analyze the massive amount of data coming from your ERP software.
What Other Systems Will You Replace in the Future?
When selecting an ERP system from a Tier 1 vendor, consider what other business applications you may replace in the future. Does the vendor offer those business applications? Would it be beneficial to replace legacy systems as part of your ERP project plan? What is your digital strategy, and can this vendor be your partner for the long haul? These types of questions may help you narrow down your list of potential ERP vendors.
5. Consider Case Studies and References
Since Tier 1 ERP vendors tend to have thousands of customers, they should have plenty of case studies and references for you to consider. Ask the vendor to provide a reference for one of their customers of a similar size and industry. Better yet, ask if there are any case studies on your competitors.
Leveraging these references and case studies, you can determine the kind of implementation partner the vendor is, what their implementation and support process is like and what other applications within their portfolio may add value to your ERP implementation.
Implementing a Tier 1 ERP System is Challenging
Since Tier 1 software solutions can have a long implementation duration and often require business process changes, it’s smart to select an ERP vendor that will give your company the attention it needs.
It’s also important to find an ERP consultant that can help your company select and implement your new system. Independent ERP consultants, like Panorama, can work with your vendor to develop a project plan that includes success factors like business process reengineering and organizational change management.
Request a free consultation below to speak with our ERP experts, and don’t forget to download 2021 Clash of the Titans.