Erp Smb
SMB ERP
Crumley, Fain, McFadden
ERP TREND TOWARD SMALL AND MEDIUM-SIZED BUSINESSES
Sam Crumley, Ezra Fain, Tara McFadden Today, large firms cannot compete without ERP systems. For large firms, ERP systems are recognized as an enabler rather than a differentiator. This distinction is evident in the proportion of large firms utilizing ERP systems. In the U.S., 98 of the Fortune 100 companies use Oracle to some extent.1 Furthermore, over 80% of Fortune 1000 firms have implemented a large ERP solution.2 Given the saturation of the ERP market for large corporations, new customer growth in the large firm market becomes minimal for ERP vendors. ERP software providers and implementation partners can maintain their revenues with support and upgrades but organic growth is only possible with expansion into new markets. With the convergence of ERP software firm’s growth demands, increasingly economical computing and networking, growing importance of information utilization within firms, and an ever growing technically trained workforce, the incumbent ERP solutions providers are now focusing sales growth on the small and middle sized business (SMB) market. Now, increasingly more SMB’s are gaining an efficiency and information advantage over their competition with the installation of ERP systems. Hence, industries dominated by SMB’s must now consider implementing ERP systems as their market landscapes become increasing competitive. For the purpose of our analysis and for the major vendors, SMB’s are firms with less than 1,000 employees or less than $100M in revenue.3 There are approximately 500,000 SMB’s in the U.S. versus only 95,000 firms in the U.S. with revenues over
1 2
www.oracle.com/corporate/story.html Conversation with Shawn Plaster of Accenture in Seattle on Monday, May 23 3 Oracle Presentation, June 2004 – Mid-Market Special Edition Campaign Plan: H1FY05
1
SMB ERP
Crumley, Fain, McFadden
$100M. Oracle, SAP, and Microsoft are now fiercely
Crumley, Fain, McFadden
ERP TREND TOWARD SMALL AND MEDIUM-SIZED BUSINESSES
Sam Crumley, Ezra Fain, Tara McFadden Today, large firms cannot compete without ERP systems. For large firms, ERP systems are recognized as an enabler rather than a differentiator. This distinction is evident in the proportion of large firms utilizing ERP systems. In the U.S., 98 of the Fortune 100 companies use Oracle to some extent.1 Furthermore, over 80% of Fortune 1000 firms have implemented a large ERP solution.2 Given the saturation of the ERP market for large corporations, new customer growth in the large firm market becomes minimal for ERP vendors. ERP software providers and implementation partners can maintain their revenues with support and upgrades but organic growth is only possible with expansion into new markets. With the convergence of ERP software firm’s growth demands, increasingly economical computing and networking, growing importance of information utilization within firms, and an ever growing technically trained workforce, the incumbent ERP solutions providers are now focusing sales growth on the small and middle sized business (SMB) market. Now, increasingly more SMB’s are gaining an efficiency and information advantage over their competition with the installation of ERP systems. Hence, industries dominated by SMB’s must now consider implementing ERP systems as their market landscapes become increasing competitive. For the purpose of our analysis and for the major vendors, SMB’s are firms with less than 1,000 employees or less than $100M in revenue.3 There are approximately 500,000 SMB’s in the U.S. versus only 95,000 firms in the U.S. with revenues over
1 2
www.oracle.com/corporate/story.html Conversation with Shawn Plaster of Accenture in Seattle on Monday, May 23 3 Oracle Presentation, June 2004 – Mid-Market Special Edition Campaign Plan: H1FY05
1
SMB ERP
Crumley, Fain, McFadden
$100M. Oracle, SAP, and Microsoft are now fiercely