SIZE DOES MATTER
Of course, smaller technology providers, such as Epicor, with $1 billion in annual revenue, argue that CEOs should have the choice of working directly with the original provider of ERP software and thereby cut out a layer of intermediaries. “We think freedom of choice is better,” says John Hiraoka, executive vice president and chief marketing officer at Epicor, which deals directly with its customers in North America. “The ability to choose between working with a local partner or the software organization provides CEOs with much more flexibility.”
The rule of thumb is that about 20 percent of SME companies buying their first ERP systems are opting for cloud-based solutions, but that figure is up from only 5 percent just two or three years ago and the industry expects the number to continue to grow rapidly. Hiraoka says non-manufacturing companies in finance, retail or distribution industries have been quicker to embrace the cloud because earlier versions of the software couldn’t handle the complexity of manufacturing. However, that is changing as the industry improves its offerings.
CEOs have also tended to locate functions in the cloud that are not seen as mission-critical, like the storage of emails. That, too, is changing as more embrace cloud solutions for their core functions, says Hiraoka. He says CEOs who are considering adopting an ERP system should consider the ease of use of any software they acquire. Hiraoka naturally argues that Epicor’s software has been redesigned to make it perform just as a consumer would use Google’s search engine. Epicor’s software can be used as seamlessly on a smart phone as it performs on a desktop or tablet, he adds. For its part, Microsoft says its systems have been designed to resemble its widely used Office products, familiar to the vast majority of users.
Certainly, there are many variations on a theme. But whether CEOs choose large or small technology partners, and whether they choose to embrace the cloud or not, they do seem to be stepping up to the ERP challenge because the systems are so essential in helping the small guys get bigger. The bottom line? Despite all the fears about ERP “bloat,” small company CEOs are embracing the tool and are increasingly basing it in the cloud.