Published on the 04/04/2016 | Written by Hayden McCall
Fourteen of 20 enterprise ERP solutions available in the A/NZ region have delivered fully browser-based access…by Hayden McCall
A long hard slog to re-architect ERP systems around modern web-based platforms is entering a new phase as vendors complete re-design projects to deliver their software via browsers. R&D teams will not be the only ones sighing with relief. Product managers, marketers and advertising copywriters will finally be able to stop using exuberant and factually dubious terms to legacy ‘cloud’ architectures: terms like ‘available in the cloud’, ‘cloud-ready’ or ‘cloud-enabled’, which in reality meant ‘can be hosted in a third party data centre, but only for use on your desktop’. A cloud by any other name. The transition has not been painless. It’s expensive, time consuming and the much-touted merits of fully browser-based solutions are not universally accepted. But the cacophony created by those vendors with built-for-web solutions combined with user expectations of anywhere, anytime and any device access have been impossible for vendors to ignore. Xero has a lot to answer for, along with Salesforce, NetSuite and a raft of enterprise-grade solutions being delivered via software-as-a-service (SaaS) models. So why change? Patrick Saundry, head of SMB Solutions at SAP partner UXC Oxygen commented: “The pressure to remain competitive is felt by people on the front line and it is these line-of-business users that are driving the demand for more heterogeneous business tools, particularly mobile apps.” A thorn in the side of orthodoxy The cloud revolution that brought ease of use, rapid, lightweight implementation and on-demand user licensing has created new expectations across all software categories and ERP has not been immune. ERP buyers and system owners, of course, have understood that the functionality necessary to run their unique, complex business couldn’t be delivered through a browser. The gob-smacking amounts of cash spent on configuring ERP systems meant they were ahead of the pack and could “run simple” as SAP puts it. ‘These SaaS systems are for companies that settle for the generic, bland and undifferentiated – that’s not us’ they said. Err, wrong. In fact it is that “simple” word that is pivotal. If software processes aren’t simple and easily accessible they will be circumvented. Process compliance will be paid lip service while back-office workarounds prevail. Underutilisation of ERP investments is commonplace – a Telsyte survey last year reported that Australian CIOs reckon less than six percent of staff use 80 percent of ERP functionality. Quantifying cloud investments (and returns) Analyst estimates put SAP’s spend on rebuilding its all-cloud BusinessByDesign product at around A$4.4 billion, over the course of seven years. Justified, perhaps, by annual cloud revenue growing 109 percent to A$3.4 billion (as of Q4 2015). But against a total SAP revenue of A$31 billion, it’s a tough game. The global CEO of Microsoft (no less) was the man announcing the latest ‘cloud-first’ release of the Dynamics AX suite, providing an indication of the visibility the investment has inside Microsoft. Satya Nadella is not alone. Eye-watering cloud R&D investment announcements from ERP vendors over recent years are commonplace. As one example, announcing a doubling of product R&D investment, Unit4 said “we will invest even more aggressively in innovation and R&D”. Closer to home, Peter Dickinson, Greentree CEO and cloud sceptic who once described some cloud vendors as “sandal waving zealots”, has budgeted around NZ$20 million to build the browser-based Greentree4. This from a company with annual revenues at the time of around NZ$15 million. And, according to vendors’ responses to iStart’s annual ERP Buyers Guide, the R&D investments are starting to pay off. Fourteen products of the 20 that made the cut have confirmed that “all screens are accessible via browser”, with all others (bar one) progressively converting screens to be browser-enabled. Mobility is also on the same track, with 14 vendors reporting that they have built mobile apps (iOS or android) for their solutions. Most of those are not in fact native mobile apps, but rather responsive versions of the same desktop screens – such is the beauty of the HTML5-compliant code base most have used. PwC prepared a report back in 2013 entitled ‘ERP in the cloud: Is it ready, are you?’, outlining the key considerations for cloud implementations at the time. Paramount among them was the extent to which ERP vendors were “investing significantly in enhancing their offerings, expanding the functionality and availability of their services, and reducing the risks of adoption”. In 2016, it seems, that investment is now in production and available for deployment. Upgrading legacy client/server-based installations to the latest versions is seldom a trivial exercise. There will be new web servers, public visibility and security architecture issues to resolve, so it will be some years before user communities start to enjoy the latest features. Saundry points to hybrid cloud as a way through this phase; “Most often we will recommend a hybrid cloud environment where the business can augment the investment in its existing SAP ERP on-premise solution by adopting any one of a number of line of business cloud applications.” The ERP vendor community is now switching its focus toward simplifying user experience in the application and building implementation accelerators to reduce project risks and failure rates. The issue is becoming less about whether the ERP products are ready; rather, the question now is whether businesses are ready to invest. And that is not a new challenge for most vendors and their partners. The iStart 2016 ERP Buyer’s Guide provides side-by-side comparison of the leading ERP solutions in the A/NZ region. The full PDF can be downloaded here, and detailed product fact sheets on each of the individual solutions can be accessed here. If you require assistance with your ERP selection and evaluation process, the get-a-shortlist service accelerates the challenge of matching of your requirements against vendor and product capabilities. Why, when, and how to invest wisely… The benefits of incorporating a data warehouse when upgrading your ERP… What to expect for the future of payables… Manual processes can lead to error-prone data analysis… What is a Finance Department and Manager Level KPI?…
The rapid increase in the availability of web-based business software has been a thorn in the side of the established ERP software houses, prompting two stark choices – massive investment or sunset solutions.
The investment by ERP solution providers to modernise their architectures is a matter of survival. And as a result, the spend has been massive, but so too are the returns.FURTHER READING
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