Computing South Africa
In tough economic conditions, it is standard practice for certain organizations to besmirch the efforts and products of competitors.
The reasoning is that if they can cast some FUD (fear, uncertainty and doubt) around a particular industry or company, they have a better chance of convincing potential customers to avoid these competitors and buy their solutions.
“This kind of sales technique is exactly the type of unethical behavior that got the ICT industry into the position that it is in right now,” says Mike Evans, MD at J.D. Edwards SA. “Customers today want an up-front ICT partner that can deliver solutions targeted at delivering exactly what the client needs, not some fuzzy sales pitch that will be followed by endless bug fixes and consulting bills.”
In particular, Evans refers to businesses that have reached the zenith of their industries and have few options left. “Instead of changing and advancing their product and industry, they attempt to slow the rate of innovation to milk their markets a bit more,” he adds.
A recent comment in an American publication represents this type of marketing. A well-known industry figure was quoted as saying: “Everyone in the world who needs an enterprise resource planning (ERP) system has one”.
“This is clearly an attempt at FUD,” Evans states. He concedes that the ERP market as we knew it five years ago is something of the past, “not because ERP is of no business value; on the contrary, it is of even greater value to organizations, because ERP has evolved to meet 21st-century customer requirements.”
In SA, for example, the ERP market is growing healthily (J.D. Edwards is posting growth figures in the 40 percent range). A key reason for this is Y2K: Just before the millennium change, companies stopped ERP spending and waited for the “end of the world” to pass. Now they are starting to look at what improvements their ICT systems need, as well as what additional value new ICT solutions can deliver to their businesses.
“The downturn has put customers in a good position,” notes Evans. “They can pick and choose and find a solution that delivers exactly what the business wants. ERP vendors who have moved with the markets, and evolved their products accordingly, are on target to serve their customers and profit from the changing times.”
What customers demand is value. Integrated systems that streamline business processes and smoothly interact with legacy systems sell. Massive installations taking years and several multiples of the licensing costs to implement are not going to be approved. Standalone applications have fallen out of favor across the globe. Systems that take a holistic view of the organization and its data, avoiding silos of redundant data, are in demand.
Evans affirms: “This is where ERP vendors have the advantage; the systems that they provide have been integrated for years.”
The holistic approach also makes it easier to add new applications to the corporate infrastructure. “Why would a company have a separate database and set of applications for its CRM initiatives, for example, when most of the data and access mechanisms are already in place in its ERP implementations?” asks Evans.
Building CRM applications into the overall ERP system provides more than mere customer information and tracking. It permits the corporation to evolve relationship management into customer lifecycle management and expand the definition of CRM to include all of the business processes and associated systems that touch a customer, including billing and delivery.
The value of the solution to a business grows considerably when business applications are tightly integrated with solid ERP and supply chain management (SCM) functionality. This solution enables the business to support and streamline its business process from original customer contact through post-sales service.
“The reality of the market we operate in is that ERP, as it was sold five years ago, is dead,” comments Evans.
However, he adds that ERP, as it has evolved into a solid foundation for global e-business, is certainly not terminal and has not been relegated to the hangers-on brigade, which merely sells upgrades and licences.
Individual point solution applications that were hailed as winners and market conquerors a few years ago in areas such as customer relationship management, human resources, and supply chain management are merely a burden on clients’ pockets and infrastructures now. Those erstwhile industry darlings are today’s “also-rans”. Their initial functional advantages have been eroded and the integrated suites that serve the greater organization in a holistic solution are in greater demand.
As customers’ requirements have changed over the years, so ICT products have evolved to meet these needs. ERP is no different. It is all about delivery, as customers tend to avoid hype these days and rely on proven reliability, value and a measurable return on investment.