Competitive Analysis

            SAP:  Considering the large price of SAP’S ERP in purchasing, implementing and maintaining the system, SAP also has to deal with competitors, offering alternative and substitute products for customers. However, SAP ERP is still the top-selling ERP system, in regards to its market share. Although there are numerous alternative available for companies, we focus on Oracle, Microsoft Dynamics and Infor (“Top 10 Enterprise Resource Planning Vendors”, 2015). All these systems are functionally ERP systems, but have both advantages and disadvantages which have to be compared, considered and weighed up, such as cost, values and risk but also functionality, IVK and Barton need to consider all these issues such as their market, their staff and users, as well as cost and fit when they decide which system they are going to use.

ORACLE: Oracle was for many years the database of choice for SAP ERP applications and was formerly best known for its relational database. The cooperation between Oracle and SAP had existed since the late 70’s until the beginning of the 20th century. In 2004 Oracle started to build its own ERP solutions. At the same time SAP began to offer its ERP solutions on the Microsoft SQL Server database platform as well. However, Oracle began to become a serious player in the ERP market and is now a well-established number 2 in the Tier I market (“Top 10 Enterprise Resource Planning Vendors”, 2015). SAP’s ERP system integrates several business applications, uniting and working with multiple databases. SAP works in ABAP (advanced Business Application Planning) language. In contrast, Oracle’s database is SQL-based and the company created its own ORDBMS (Object Relational Database Management System) and a pluggable architecture, using open industry standards. This makes it quite easy for companies to integrate and customize. The advantage for even small companies such as IVK is that they can also deploy it at an affordable price, whereas SAP’s system is hard at customizing and companies need to pay more for additional needs.

            MICROSOFT DYNAMICS: In contrast to Oracle, Microsoft Dynamics is mostly focused on Tier II clients in the ERP market. The solutions provided by Microsoft Dynamics refer to a number of different business domains including in the Customer Relationship Management domain. One of the most important advantages of Microsoft products is the user friendliness which holds for its ERP products as well. Especially with regard to the high complexity of ERP systems, it is crucial to make it as easy as possible for the user (“Top 10 Enterprise Resource Planning Vendors”, 2015). Microsoft Dynamics ERP offers comparable software to SAP’s All-in-One solution. However it is much more affordable than SAP’s system. Additionally, compared to SAP and Oracle, Microsoft Dynamics is significantly faster to implement and offers user-based pricing as well as a cost-calculator, similar to SAP. Furthermore, it is also scalable and fully customizable, like SAP and the risks of Microsoft Dynamics are also similar to SAP. Talking about IVK, Barton wants to restructure the IT departments, creating synergies across line of business integration as well as allow IVK to hire a Microsoft specialist to ensure they can take full advantage of software standardization. Microsoft Dynamics’ uses the same system as Microsoft Office. The advantage is that IVK probably already uses at least some of the applications. This in return would minimize training and help transitions.

            INFOR: The privately held company Infor Global Solutions has grown rapidly in the Tier II market since 2002. The company has taken an aggressive acquisition route to growth and continues to follow this path. Infor tries to match the footprint of the top 3 ERP vendors SAP, Oracle, and Microsoft by implementing a global presence with clients in over 190 countries. The solutions offered by Infor are in at least 14 different domains and an especially good presence in the manufacturing and distribution industry, the communication and energy sector, the service sector, and the retail sector (“Top 10 Enterprise Resource Planning Vendors”, 2015). Infor can be used with startups, small, medium, and large businesses and is also scalable as an organization grows.  The advantage is that it integrates well with Microsoft Office applications because it’s built on Microsoft Sharepoint. The advantage for IVK’s staff is that the interface is very friendly and consistent, offering real-time data. Furthermore it also supports multiple platforms and server OS. This makes integration and implementation easier and less risky to some extent. 

            The market share for ERP systems is widely diverse.  Of the systems that we are comparing, SAP holds 23%, Oralce holds 16%, Infor holds 16%, and Microsoft Dynamics holds 9%.  Below is a table that compares the four systems across many categories. While SAP may hold the largest market share, it has competition from the other systems in terms of cost and implementation duration.  Both Microsoft Dynamics and Infor come in below the total implementation cost for SAP.  Infor also has a competitive edge on implementation duration of 16.2 months compared to SAP's 19.5 months.  While SAP may be the most recognized on the market, it would be beneficial for IVK to do a complete analysis of which ERP system fits their needs best. 

 

References

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Compare Business Products (2015) Top 10 Enterprise Resource Planning (ERP) Vendors.           Retrieved from: http://resources.idgenterprise.com/original/AST0067016_Top_10_ERP_Vendors.pdf

Explore Consulting (2015). NetSuite Pricing. Retrieved from: http://www.exploreconsulting.com/netsuite/netsuite-pricing/

Jutras, C. (2008). The Total Cost of ERP Ownership in Mid-Size Companies. Retrieved from:           http://www.erp.org.il/download/files/tco_of_erp_in_mid-size_companies_-aberdeen_07-31-08.pdf

Panorama Consulting Solutions (2015) Clash of the Titans An Independent Comparison of SAP, Oracle, Microsoft Dynamics and Infor. Retrieved from: http://panorama-consulting.com/resource-center/clash-of-the-titans-2016-sap-vs-oracle-vs-microsoft-dynamics-vs-infor/