SMB ERP Buying Guide for Oracle, Microsoft and SAP
While Oracle, Microsoft and SAP offer ERP software primarily geared toward larger enterprises, they also have solutions appropriate for SMBs.
Over the past year, we’ve published a series of ERP guides. One covered Oracle, Microsoft and SAP ERP solutions for the enterprise, while another detailed what other companies were doing in the midmarket ERP and SMB software spaces.
The Big Three also have solutions to address the SMB market for ERP, which is the focus of this guide.
SAP Business One is what the company offers to the SMB space. It provides integrated sales, financials, CRM and operations. According to SAP, it works well as the next step for SMBs that have outgrown packaged accounting-only software and need to replace multiple, non-integrated applications. Around 35,500 companies already use SAP Business One, which is almost exclusively sold by partners.
A core component is Business One's embedded analytics based on Crystal Reports. The analytics are powered by SAP HANA, the in-memory analytics platform which is becoming central to many of SAP's software roadmaps. “Analytics is a growing trend in small business ERP,” said China Martens, an analyst at Forrester Research. “They can either be layered on top of ERP, embedded in the heart of ERP or additional, reporting capabilities. This is a continuing focus for ERP vendors. And SAP has been bullish about in-memory technology.”
According to Andreas Wolfinger, Head of SAP Business One Global Product Management, pricing from SAP Business One partners can start as low as $4,000, including software licensing and implementation.
“SAP recommends 30 to 50 maximum concurrent users, but the product technically serves up to 70 users per database,” he said. “As complexity increases, Business All-in-One becomes the preferred choice.”
SAP's pre-defined implementation processes at fixed prices can help SMBs achieve return on their investment at a faster rate, Wolfinger said. For those choosing their first ERP system, SAP recommends the use of starter packages, as they provide preconfigured software that can be implemented in three to 10 days, covering all essential administration, sales, purchasing and inventory processes.
Once the business grows and needs to add more users, companies can upgrade to the standard edition of SAP Business One at any time, without having to reconfigure the software. SAP also provides tools to help automatically shift data from an older ERP system to SAP without extensive downtime.
Microsoft Dynamics ERP
Microsoft has acquired a rich portfolio of ERP software over the past decade or so. But try to get the company to specify which of its various ERP flavors is best for SMBs, and you don’t get a simple answer.
“Organizations in North America that are primarily looking to streamline financials and operations should consider Microsoft Dynamics GP,” said Gordon Macdonald, Group Product Manager, Microsoft Dynamics ERP. “Organizations outside North America, and those with specialized industry needs, should consider Microsoft Dynamics NAV. Organizations that are primarily project-driven should consider Microsoft Dynamics SL.”
Oh well. So what do they consist of? They are all available through either traditional on-premises deployments or the cloud. Detailed capabilities for each product are available on the Microsoft website, along with a product-selector tool to help determine which product is best suited to a particular environment and a list of Microsoft Certified Partners that sell the software.
As a general guideline, McDonald said most of these ERP products can be used by organizations with 10 to 250 employees. Organizations with more than 250 employees and/or a need for customized ERP would be better served by Microsoft Dynamics AX, which is designed for the enterprise market.
As Microsoft Dynamics NAV and Microsoft Dynamics GP are offered exclusively through resellers and not sold directly by Microsoft, the final price for both products varies. However, an MSRP price quote and more information on pricing can be found online.
Rather than dealing with tools, features and technologies, Macdonald suggests using a more human approach to ERP product selection. “Put people first when selecting an ERP tool,” he said.
All of Microsoft's ERP software has been engineered to have the same look and feel as Microsoft Office. User familiarity with the ubiquitous Office suite can often mean an easier time during the early days of ERP implementation.
Forrester Research's Martens sees this blurring of the lines between applications as a definite trend in SMB ERP. “Vendors are responding to user needs to give more of their staff access to data held within ERP apps by working on bringing more of a common look and feel,” she said. “The idea is that users can be within an ERP app but not know they’re there and not require training to reach the information they require.”
Oracle declined to be interviewed for this story. But at least they didn’t pretend to serve the SMB space by presenting a product that wasn’t suited to it. About the closest they come is the JD Edwards World ERP suite, but a quick look at the website reveals a level of sophistication that is beyond the needs of most small businesses.
“Oracle’s focus is more around what it can provide through its stack of products – all the way from servers and storage through database and middleware to business intelligence and applications, both general purpose and industry specific,” Martens said.
Drew Robb is a freelance writer specializing in technology and engineering. Currently living in California, he is originally from Scotland, where he received a degree in geology and geography from the University of Strathclyde. He is the author of Server Disk Management in a Windows Environment (CRC Press).