Vendor Credentials Influence Customer Decisions

Basil Daniells, regional sales director (Middle East, North Africa and India), Epicor Software talks to Biztech2 and share his views about general concerns and the evolving ERP needs of the mid-market.

When we talk about the ERP selection criteria of mid-sized customers, what are the top criteria they employ?

Companies of all sizes employ similar criteria while selecting an ERP solution. Their primary concern is the functionality fit for their business needs, followed by the compatibility of the technology of the product with their existing and planned technology infrastructure. The implementation and support services capability of the ERP solution provider often makes the difference between success and failure in ERP projects. Often companies choose an ERP product based on the credentials of the services provider rather than the ERP product itself. The price of the solution, obviously a critical criterion, is evaluated within the context of all the above criteria.
Is functionality more important to mid-market customers than the TCO or RoI?

Today, most midsize companies in emerging economies have aggressive growth plans and tend to invest in systems that can grow in scale and scope with their operations. Therefore, they are inclined to calculate TCO of the solution over a longer time period. At the same time, companies mostly do not compromise on core business functionality which may be offering them critical differentiators in a highly competitive environment.

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What about ease of use? How important is that for smaller companies?

ERP vendors strive continuously to improve the ease of use of their applications. At the same time, the IT savvy of the average business software user has also advanced substantially. Ease of use is, perhaps, more important for smaller companies, as they often do not have adequate in-house IT personnel to help them use the application.

Reports suggest that quite often mid-market companies struggle to extract full potential of their ERP investment due to lack of clear goals. Do you find this to be true?

This has been a major concern area for both ERP solution providers and their customers, and has made it difficult for companies to realise the benefits from the system. However, as companies embrace international best practices and processes in business management, we are seeing a marked shift towards an objectives-driven approach to ERP implementation.
What do you think they need to do to maximise returns from their ERP?

A clear understanding of the business objectives of the ERP implementation and their communication to the solution provider will always ensure the best results from an ERP investment. Ownership of the project at the most senior level within the organisation is essential for its smooth implementation and successful transition. Effectively managing the change from the current system to the new one is critical for its quick adoption and maximum utilisation. Here, the onus lies on both the solution provider and the customer organisation to overcome any inertia-based objections and get the staff trained and supported on the new system. ERP solution providers, today, use modern training techniques to ensure that the users are enabled on the system within a short time.

In the last few years, the functionalities offered in ERP suites have increased greatly and they now extend beyond the core ERP functionalities. Do smaller customers ask for these “add-ons”

Usually, only the business-critical add-ons are implemented with the initial ERP modules. As the organisation gets more comfortable with the use of the new ERP system, they become interested in add-ons. In our experience, add-ons on financial reporting, business intelligence and document management tend to have greater demand than the others.
How do you perceive the entry of larger solution vendors in your mid-market backyard?

Globally Epicor is positioned as a midmarket ERP provider. In India, while in the manufacturing and distribution sectors, we often find ourselves catering to mid and some large size companies, in the retail and services sectors our product suite is a good fit for large retail chains.

ERP vendors, who have traditionally catered to large enterprises, tend to have little understanding of midmarket needs and offer watered-down versions of their products that may have higher lifetime TCO than midmarket focused players like us.