The Little Geeni

The last great boom for ERP was at the end of the 1990s, as large numbers of organisations around the world replaced their legacy applications in response to the potential doomsday scenario that was looming as a result of the Y2K bug. There were literally dozens of ERP vendors in the market, most of which prospered and grew at an impressive rate in a buoyant market.

Since those heady days, the ERP vendor landscape has changed dramatically. Today, as shown below, six vendors account for almost two thirds of global ERP sales and SAP and Oracle alone own 50% of the global market by revenue. Two of the top six vendors, Infor and Microsoft, did not have an ERP presence at all at the start of the last decade.

 Fig 1: Percentage of Global ERP Revenue by Vendor (2008)

 

  

This has come about largely as a result of significant rationalisation as vendors sought to ward off static or declining revenues by acquiring other ERP products that provided access to new markets in different business sectors, geographies or client market segments.

While the rationalisation process has reduced the number of ERP vendors, it has not done much to reduce the number of ERP products – since the majority of the products gained by acquisition are still being sold by their new owners. The range of products tends to reflect the nature of competition in the ERP market.

Typically, ERP products compete either horizontally by market segment or vertically by industry segment. SAP and Oracle dominate the ERP market in large organisations. Occasionally, Infor, Lawson or Microsoft will win projects in this segment, particularly if the customer is close to the lower boundary, but for really large organisations the choice almost always comes down to either SAP or Oracle.

At the small enterprise end of the market, Sage, Microsoft, SAP, Infor and to a lesser extent Lawson, compete with a number of smaller vendors of ERP systems, as well as a myriad of accounting packages and Best-of-Breed systems that offer elements of ERP functionality. It is noteworthy that of the top six vendors, only SAP and Sage have specific ERP products designed for the small enterprise market – the other vendors compete in this segment with products that they also use for the mid-market.

The mid-market segment is the only one in which all of the top six vendors compete, along with a range of vendors of other ERP products. Many of these products have been designed specifically for particular industry segments e.g. process manufacturing, project-oriented services, pharmaceutical distribution, etc. In order to compete successfully against these, the leading ERP vendors have had to add sector-specific focus to their product offerings. This has been approached in a number of ways: 

Development by the ERP vendor of industry-specific, pre-configured templates using a standard ERP product (e.g. Oracle’s Business Accelerators or SAP’s Best Practice Templates). The templates are fully supported by the ERP vendor and are intended to provide a lower cost implementation by removing the need to configure the system from scratch.
Addition of new vertical-specific functionality to a standard ERP product by a value-added reseller (VAR) (e.g. VAR-modified versions of the different Microsoft Dynamics or Sage products). The enhanced versions of the product are primarily supported by the VAR rather than the ERP vendor.
Acquisition of ERP products that have been designed specifically for industry verticals (e.g. Microsoft’s acquisition of the Fullscope Process Manufacturing solution for AX, Infor’s acquisition of SX.e for Distribution or Lawson’s of M3 for Manufacturing). Once the product has been acquired, the buyer provides product support.

One important point to make about the competitive landscape for ERP products is that the neat delineations suggested by the market segments and verticals just described do not always translate into a logical choice of ERP product. For example, most ERP vendors will be able to point to customers outside of their primary target market segment who are successfully using one of their products. Sometimes, organisations will choose a generic ERP product rather than one tailored for their industry vertical, often because of concerns about the longevity of the tailored product or of the organisation that supports it.

Finally, many larger organisations do not choose a single ERP product. The hub-spoke model is becoming more common, where a single ERP product (usually SAP or Oracle) is used to drive group financials and the larger divisions, with a mid-market or even small enterprise ERP system deployed in some of the smaller parts of the organisation.

This is an extract from a much more detailed article, which is available for download free of charge from www.bsmconsulting.co.uk/publications.

BSM is an independent ERP consulting organisation and works with organisations worldwide to provide client-side services across all stages of the ERP life cycle.

For further information on ERP, please contact Sean Jackson on Tel: + 353 (0) 91 746900 or by e-mail info@bsm.ie

 

ERP 2010, Marketplace

There is increasing awareness of Voice over Internet Protocol (VoIP) in the Australian marketplace of late, and understandably so. VoIP has the potential to revolutionise the way we communicate.

Much of the hype has been around residential VoIP, rather than business VoIP communications. It is crucial to understand that major differences exist between residential and business grade VoIP solutions. Relying on a residential grade VoIP service can have disastrous effects for a business, including loss of sound quality in phone calls and down time where your business’ ability to communicate may be cut off entirely. The integration of a business grade VoIP solution has many cost and efficiency benefits for Australian Small to Medium Businesses (SMBs).

The most obvious advantages of a business-grade VoIP solution are the reductions in call and line rental costs, however, there are many other significant business advantages for SMBs of all sizes to realise:

* Increased productivity by integrating VoIP with the computer desktop and allowing features such as Click2Dial from Outlook

* Increased business metric capabilities from detailed reporting on inbound and outbound call patterns

* Vastly improved and centralised personal attendant and reception capabilities allowing visibility of all staff extensions in a consolidated view, simplifying transfers to extensions and voicemail

* Awareness of an individual’s location as ‘available’, ‘busy’ or ‘out of the office until 2pm’

* Increased efficiency from converging the voice and data networks (operating both voice and data on the one network)

To decide how best to integrate VoIP with your existing voice and data infrastructure you must have a clear understanding of your business drivers and the results you wish to achieve.

VoIP Gateways

Ideal times to consider the introduction of a VoIP solution are during an office relocation, or during times of high growth. An excellent entry level solution for businesses who wish to experience the benefits provided by VoIP is to connect their phone system to PSTN via a VoIP gateway device. A VoIP gateway device is a simple piece of hardware that allows the basic integration of VoIP with a traditional phone system, most often without having to physically change any configuration.

Pacific Internet’s VoIP gateway is connected via a business-grade broadband service and will send calls destined for external locations (whether local, national, mobiles, international or another VoIP service) across the VoIP network and into the traditional phone line at the destination point. It is Pacific Internet that maintains connectivity to the traditional phone line. This scenario allows for the seamless integration between the two networks (PSTN and VoIP) and a traditional phone system to co-exist with a VoIP solution. The advantage of a gradual migration to a total VoIP solution is that it allows you to immediately appreciate some of the benefits of VoIP, without the upfront cost of replacing your entire existing voice infrastructure.

Connecting to Traditional Voice Networks via VoIP

A number of scenarios are available to connect your phone system to the traditional PSTN via VoIP, the most common of which are:

* Full replacement of traditional analogue or digital lines for all inbound and outbound calls, providing for standard geographic Direct Inward Dial (DID) numbers to be allocated to the VoIP service, for example, 02 9999 9999 for Sydney, 07 3333 3333 for Brisbane, 02 4900 0000 for Newcastle

* Partial replacement of traditional analogue or digital lines for all outbound calls

* Installation of additional VoIP lines to sustain call overflow during unexpected or regular peaks in outbound calls traffic

* Additional lines for calling only specific, designated prefixes. For example, making all outbound calls to mobiles via VoIP.

Each of these scenarios can be configured to either work automatically or to require manual user selection with most phone systems. For example, if VoIP is being installed solely to make all outbound calls to mobiles then the phone system can be set-up via Least Cost Routing (LCR) to automatically use a VoIP line when an individual calls a mobile.

An important consideration when integrating your traditional telephone system with VoIP is to very clearly understand current calling behaviour. For consideration are items such as:

* How many simultaneous inbound calls does the business receive?

* How many simultaneous outbound calls does the business make?

* How many spare PSTN ports (or trunk ports) does the telephone system have?

* Are the spare PSTN ports for analogue lines or for digital (ISDN) lines?

* If there are currently insufficient spare PSTN ports, can the phone system be cost-effectively upgraded with additional cards to provide sufficient port capacity?

Once you have a clear understanding of your current call behaviour and phone system, you can accurately determine how many VoIP lines are required and the resulting demands this will place on business-grade broadband service. You must consider bandwidth requirements, segregation of voice from data, and Quality of Service (QoS).

As your VoIP provider, Pacific Internet, can make qualified recommendations on the best configuration to achieve your desired business benefits. Integrating VoIP with an existing business data network and phone system takes a significant amount of careful planning and it is crucial that this step not be overlooked, however, it is an ideal way to test a VoIP solution and immediately start to appreciate some of the cost and efficiency benefits that VoIP can provide.

Information Technology Australian, Internet, Marketplace, Over, Protocol, Voice, VoIP