Microsoft Word - Es - The Future Of ERP


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Microsoft Word - Es - The Future Of ERP

  1. 1. February 2, 2009 The Future of ERP ETS 09-02-09 Experture Strategic Direction or Planning ERP Solutions Group …experts on demand Client Challenge: Our client is interested in strategic direction of the top vendors of ERP solutions. Experture Opinion: Systems evaluation is not a simple task. Selecting an ERP can be difficult and, sometimes even very complex particularly in a large company where we sometimes deal with diverse industries or where the business is segmented for example in financial services, education. It is critical that ERP systems operate seamlessly throughout all operating units. In addition there must be data management consistency to support business processes and Management Reporting/Decision Support. ERP solution analysis should review client requirements with respect to:  Functional (Organization, Business Process, Location);  Technical (Data, Application, Technology). More specifically, the review should encompass:  ORGANIZATION - who will enable this process?  PROCESS - How this process will work, to achieve business goals  DATA - What information will enable this process?  APPLICATION - What applications will enable this process?  TECHNOLOGY - What computers and equipment will enable this process?  LOCATION - Where this process will take place, what policies do we need? In Today’s global and ever changing environment, companies are facing complexities and competition. They often deal with multiple organizations where objectives may be set by individual Operating Units or departments and not necessarily defined towards the Company common goals. In addition to common features regarding ERP modules or pricing it is also important to consider factors such as flexibility, security, infrastructure, Storage, redundancy and disaster recovery when evaluating Software solutions. Another variable we should consider in the ERP choice is to make should that it also accommodates business growth especially in today’s corporate strategy of merges and acquisitions. Copyright © 2004-2009 Experture, all rights reserved 4 Jennings Court, Westport, CT. 06880; (203) 254 6088;;
  2. 2. February 2, 2009 The Future of ERP ETS 09-02-09 Overview In general, ERP Systems include, but are As already mentioned in the introduction, not limited to the following modules: ERP systems must support Enterprise Basic functions in a common database in  Financial Management (Accounting) order to allow information and resources to  Customer Relationship Management be shared among different departments  Order Management within the organization. They should  Procurement provide features for solving organization  Supply-Chain Management issues such as inconsistent business  Manufacturing processes and controls, inconsistent  Data Warehouse Management financial reporting, limited global  Distribution and Logistics reporting, and limited drill down  Human Resources capabilities. Through integration of these products, Moreover ERP systems should support organizations can substantially increase future business growth, increasing efficiencies and stay competitive in a complexity and ever changing business demanding marketplace. environments. In order to conduct our analysis and help The focus of ERP System selection our client select the most suitable solutions outlined here resides in the functional able to perform management functions of domain areas. Therefore, the scope of this the company, we will focus on ERP inquiry will address business issues Software from the Top five leading primarily listing features: Providers like ORACLE (PeopleSoft, JD Edwards, Enterprise One, Siebel or Fusion  Business Processes - which describes Applications), SAP, Microsoft, Infor the work activities with some redundant Global Solutions (SSA Global tasks within a single site or national or Technologies, Baan) and SAGE group. multinational; Among other functionalities, we will focus  Organization - which describes the on highlighting basic and common features people, teams and departments; including integration, reliability and scalability.  Location which describes the physical locations or facilities. Scope Furthermore, our client operates in The scope of this analysis is based on multiple Organizational environments information from various public sources as where transactions can be processed in at well as data exchanged with business least one functional currency, which is US partners, systems integrators and Dollar in United States; that a process information from interaction with software starts at a given point to end at another; companies themselves. that in between the two points, transactions may be subject to different transformations Copyright © 2004-2009 Experture, all rights reserved 4 Jennings Court, Westport, CT. 06880; (203) 254 6088;;
  3. 3. February 2, 2009 The Future of ERP ETS 09-02-09 and, these transformations can also take  Sage Group place in different locations physical or  Syspro virtual.  SAP Considering above statement or Among these potential vendors, we are assumptions, our approach is to first making preliminary selection to retain the identify Vendors in the ERP Software Top 5 from which we will pick the ones marketplace, second choose vendors that that best meet requirements. meet the enterprise needs of our client in the market or market segments that client Preliminary Selection Criteria operates and competes in, third and finally, we will select the Top Vendor the most Selection criteria are based on business suited to transform or improve our client scope assumptions described above and key functional areas. considering that we need an integrated business functions within a single database In the scope of our analysis, we also or an ERP system that consists of a set of assume that client is mainly interested in discrete applications interfacing among the business functions of Accounting themselves, flexible and accessible across and/or HR while keeping in mind client business organizations or operating units. desire to preserve existing technology systems and continue to improve or Common Features perform in the most cost effective way. Any potential ERP Solution must meet the Depending on the gap that exists between enterprise’s requirements in Finance and the different vendors, technical aspects Human Resource (HR) providing business may be reviewed. functions through a variety of modules with the following features: Potential ERP Vendors Financial Features: Our initial research identified 16 Potential  General Ledger, Vendors from the low to the upper  Accounts Payables, midmarket. They are as follows:  Accounts Receivables  Cash-Flow Management  24Seven Office  Bank Reconciliation  Abas Software  Budgeting  Accpac  Cost Management  Agresso  Expense Management  Consona  Fixed Assets Management  Epicor  Invoicing or Billing  HansaWorld  Risk Management  Industrial and Financial Systems, IFS  Tax Management  Infor Global Solutions  Lawson Software Human Resource Features:  Microsoft Dynamics  HR Management  NetSuite  Recruitment Management  Oracle  Talent Management Copyright © 2004-2009 Experture, all rights reserved 4 Jennings Court, Westport, CT. 06880; (203) 254 6088;;
  4. 4. February 2, 2009 The Future of ERP ETS 09-02-09  Manager Self Service  Scalable and supportable growth;  Employee Self Service  Secure and segregatible data;  Time and Labor  Centralized;  Resources Planning  Reliable;  Benefits Administration  Modular and multiple platform;  Compensation Management  Quick to implement;  Tax Administration  Service-Oriented Architecture (SOA);  Payroll (Country Specific)  User and Management Reporting;  Vendor Service and Support focused. Please note we’re limiting the list to these features as we assume client is inquiring about Finance and HR only. However and Methodology if client industry or market segments require, we could provide other features Phase I such as:  Customer Relationship Features; Based on the client needs for an ERP  Supply Chain Management Features; Solutions, we can take the several steps in  Sales Order Management Features; our solutions evaluation.  Logistics and Distribution Features;  Manufacturing Features. First, select the environment that best fits our client organization requirements with Additional Capabilities key processes from Accounting-to-Finance such as General Ledger Processes, Some additional capabilities are: Accounts Receivable Ledger Processes,  Workflow Management for Approvals and Accounts Payable Ledger Processes. Management and SOX compliance;  Project Management (Billing/Costing); Second, select the functionality within the  Business Intelligence (BI) for Key organization. Assuming, for instance, we Performance Indicators or KPI; select document management as  Business Process Management (BPM); functionality within United States  Data Warehouse; organization.  Development Tools (Customization). We may want to explore multiple sites Other Considerations including international ones later on. For the sake of the case study, we will limit the Lastly, the better ERP systems are: analysis to national site.  Open and comprehensive;  Facilitate Daily Tasks; Question may need to be answered as to  Seamlessly Integrate; how many sites will be using the ERP  Not Proprietary; solutions? How many Systems users or  Flexible ERP licenses?  User Friendly Interface ;  Customizable; Third, select the client Industry. For  Regulatory-Aware (SOX Compliant); example Financial Services Segment  Automated;  Web-Enabled; Fourth, select the nature of business. Copyright © 2004-2009 Experture, all rights reserved 4 Jennings Court, Westport, CT. 06880; (203) 254 6088;;
  5. 5. February 2, 2009 The Future of ERP ETS 09-02-09 Example Services to customers client preparation and planning to build the future applications through the integration Fifth, select the enterprise size (Number of existing Technologies and adoption of of employees, annual revenue Service Oriented Architecture or SOA. Sixth, select IT budget and cost our client How does the enterprise get prepared to is ready to invest in the ERP solutions. combine various Technologies those Knowing Bearing in mind the client needs already existing in the company for continuing Lawson products. As organizations? Technology is changing, it’s important to size the opportunities to adapt and adjust to First, the enterprise should work on the changes. Therefore we would consider design of the future ERP. What should be client to make the transition by the future customization strategy? Do incorporating SOA Architecture to Oracle new features discard or integrate diverse technologies that will complement existing ones? Are there allow building, deploying and managing similarities? If so how can we ensure they processes around SOA. meet future business applications as the enterprise or market needs evolve? Phase II Second, identify Master Data and define Once we have identified the enterprise’s Standards. This to help in the integration requirements and mapped them to ERP Features, we can start comparing vendors’ Third, adopt SOA as the base to integrate solutions in order to bring the list of Oracle Applications and Non Oracle Potential Vendors down to the Top Five. Applications. At the end of our evaluation process, we In conclusion, in order to build a should select the best suited ERP Vendor successful SOA environment, enterprise able to offer the most competitive solutions should determine data objects and services in terms of that applications, both existing and new,  Licensing and Pricing have in common to ensure seamless  Quick and Easy deployment integration.  Open ERP evolution and future growth either through new releases, On the other hand, the enterprise should customization and development tools also be able to identify similarities that  Automated and integrated exist between new Technology Business  Flexible and modular platform Process flows and current ones.  Hosted or a SaaS solution  SOA Architecture Most importantly the enterprise should be  Current Systems Capitalization prepared to keep in mind cost, risk and  Ownership maintenance factors to protect its current  24/7 Available Technical Support investment. Phase III The future of ERP will depend on the Copyright © 2004-2009 Experture, all rights reserved 4 Jennings Court, Westport, CT. 06880; (203) 254 6088;;
  6. 6. February 2, 2009 The Future of ERP ETS 09-02-09 Assumption: Client chooses Oracle Once we have a clear understanding of the client needs, we can then compare Vendors The strategy or client direction is to that can offer the best functionalities at the minimize cost by doing the following: best price. However we should always  Reuse existing Technologies; consider potential customization and  Create or improve additional integration working in partnership with capabilities or Features to increase or other vendors or systems integrators in add value to existing applications (i.e. special cases. Lawson) using Development Tools available through Oracle; Finally, the best ERP solutions should  Start building based on key initiatives allow a seamless integration between the leveraging existing technologies while client Finance Business Processes and maximizing new investment. Human Resources. A typical integration usually meets Sarbanes-Oxley compliance. Important Note In order to comply with SOX for example, ERP Software should allow client to This list is not exhaustive and can be configure specific business rules in such a expanded. We decided to keep it short for way that employee expenses are approved the sake of this documentation. prior to payment by Accounts Payable. The Bottom Line: After a mid-level analysis, Experture recommends the following ranking: Recommended vendors: 1. X 2. Y Not quite recommended:  A  B  C Assuming the client decides to keep existing technologies, it appears X and Y are the only vendors with best Finance, Human Resource as well as Integration offerings. The remaining three vendors don’t seem to offer SOA architecture. Although, A stands out from both B and C, it has a lot of add-ons. Experture recommends further analysis by the client of the first two companies since they appear to be very flexible, scalable, open architecture and efficient. Copyright © 2004-2009 Experture, all rights reserved 4 Jennings Court, Westport, CT. 06880; (203) 254 6088;;
  7. 7. February 2, 2009 The Future of ERP ETS 09-02-09 Appendix - Top Five ERP Vendors Based on the information collected from different sources including vendors and systems integrators, Experture has determined that the following are the top Five ERP Software Solutions: Oracle E-Business Suite Oracle Corporation 500 Oracle Parkway Redwood Shores, CA 94065 Website: Toll Free 1-800-633-0738 Sales contact Details: Available on request Oracle Corporation (Oracle) specializes in developing, marketing and distributing enterprise software products particularly database management systems. Oracle Applications Software or Oracle E-Business Suite helps organizations manage businesses. Oracle is organized in Software and services. Oracle Services business consists of three operating segments consulting, on demand and Education. Oracle has made numerous acquisitions like PeopleSoft Enterprise, JD Edwards, Siebel CRM to build the roadmap for the future of Software Applications.
  8. 8. February 2, 2009 The Future of ERP ETS 09-02-09 SAP ERP Regional SAP Headquarters SAP America Inc 3999 West Chester Pike Newtown Square, PA 19073 Website: Toll Free 800-872-1727 SAP is the largest European software enterprise and the fourth largest in the world, with headquarters in Walldorf, Germany. It is best known for its SAP ERP Enterprise Resource Planning (ERP) software. The acronym stands for to stand for Systeme, Anwendungen und Produkte in der Datenverarbeitung ("Systems, Applications and Products in Data Processing"). Microsoft Dynamics Microsoft Corporation One Microsoft Way Redmond, WA 98052-7329 Tel: (425) 882-8080 Fax: (425) 706-7329 Web site: Microsoft develops and markets software, services and solutions that deliver new opportunity, convenience, and value to people’s lives. The company’s product segments provide management with a financial view of its key businesses. The segments provide a framework for the alignment of strategies and objectives across the development, sales, marketing, and services organizations, and for the timely and rational allocation of development, sales, marketing, and services resources within businesses. The company’s seven product segments are: Client; Server and Tools; Information Worker; Microsoft Business Solutions; MSN; Mobile and Embedded Devices; and Home and Entertainment.
  9. 9. February 2, 2009 The Future of ERP ETS 09-02-09 The Sage Group Plc North Park New Castle Upon Tyne NE139AA United Kingdom Toll Free +1 44 (191)-294-3000 Fax: +1 44 (191)-294-0002 Sales contact Details: Available on request The Sage Group plc develops, distributes and supports business management software and related products and services for medium-sized and smaller businesses. The Company is listed on the London Stock Exchange and from time to time been the only UK software company listed in the FTSE 100 Index. Infor Global Solutions Toll Free 888-436-3797 Infor Global Solutions is a privately held U.S. software company that specializes in enterprise software ranging from financial systems and resource planning to the supply chain and customer relationships. Headquartered in Alpharetta, Georgia, Infor is a privately held company whose primary shareholder is the private equity firm Golden Gate Capital Partners. As a private company, not listed on the Stock Exchange, Infor is not required to publicly disclose financial statements. So, the only public information is the one the company allows to be public. For instance, the company communicates its revenues, but not its net income, which remains unknown. Infor has acquired a number of companies (i.e. Baan, SSA Global Technologies) to become the 3rd largest business applications provider (comparing revenues) behind SAP and Oracle Corporation.