There is a curious anomaly in the market for mid-range ERP systems. The packaged business software sector is dominated by large domestic software authors, such as Sage in the UK, or Mamut across Europe and the global super-vendors such as Microsoft and SAP. Look closely at what Microsoft and SAP are doing and you will see that in the main they are distributing their offerings globally in multiple languages for sale in local domestic markets. But who is joining up the dots for the increasing band of mid-sized companies that have presence in multiple markets and operating across borders? Where are the pan-European or global mid-market resellers, asks Gary Simon, FSN’s managing editor?
The paucity of mid-market resellers geared up to serving ambitious medium sized enterprises appears to be a gaping hole. Cambridge OnLine a top reseller of Microsoft Dynamics Nav, is one of small band of re-sellers that recognises it is time to call change in the way that services are delivered to mid-sized companies that operate internationally.
Ray Olds, a director and founder of Cambridge Online told FSN, “We are seeing a growing number of clients expanding across Europe but the traditional dealership model is too parochial and caters very poorly for their needs. Up until now companies have had the choice of large and expensive ERP systems or fending for themselves on a country by country basis which means that they miss out on a globally consistent approach.”
According to Olds, even operationally diverse (heterogeneous) multi-nationals can benefit from a cohesive and unified approach to business processes, technology and human capital. “It is about striking an appropriate balance between local and group needs, taking care to accommodate local custom, culture and business practice,” Olds told FSN.
Laura Coles Director, Invenio Business Solutions agrees. She told FSN, “Following in the footsteps of their large enterprise cousins, we’ve seen many UK small and mid-size businesses aspire to selling into foreign markets as a way to increase revenues and protect themselves against the fallout from the recent economic downturn. This is driving a need for systems support across extended time zones – something which has traditionally only been available for large corporates whose budget can command an extended support service from a global service partner. Unfortunately many SMEs seeking this kind of extended support have found that the vast majority of UK-based VARs still restrict their customer support offerings to traditional UK office hours."
It is a problem familiar to Sapphire Systems, another mid-market ERP vendor specialising in SAP Business One and Infor FMS SunSystems. “With businesses formulating plans to seek new revenue opportunities overseas, comes a need to access both application and technical support across extended time zones in order to support a successful global operation,” said Ralph Bolton, Technical Director for Sapphire.
Sapphire’s solution has been to tie up with another organisation to deliver services and last week it announced a partnership agreement with Invenio to offer extended time zone services and support for customers. Although headquartered in the UK, Invenio has operations in India and the Asia-Pac region, from it provides a range of industry solutions based upon SAP Business All-in-One.
“By joining forces with Invenio, we have acquired and trained a team that enables us to support our 650 strong client base across extended time zones. We chose India for its availability of highly educated and capable technical personnel who offer excellent English language skills. Sapphire is a strong proponent of the partnership model and we engaged with Invenio due to their complementary business activities in both the European and Pan-Asian SAP marketplace,” added Bolton.
The partnership will operate from joint facilities based in Mumbai, allowing Invenio and Sapphire to pool resources, share in regional and market intelligence and provide complementary solutions expertise.
But Cambridge Online is using a different model, leveraging Microsoft’s global reseller network to provide skilled local resources where necessary but under the centralised control of a Cambridge Online.
“There is no single answer to the deployment of an ERP system In general terms multinational groups benefit from a standardised approach based on core functionality common to all trading subsidiaries and divisions. Most modern ERP solutions support this concept together with localised functionality around the core. This approach greatly simplifies deployment and allows for the introduction of uniform processes and centralised support without compromising local needs,” says Ray Olds.
In fact with substantial multinational customers Cambridge Online is very aware of the cultural, language and technical issues that accompany a global roll out.
“Projects of this nature require a combination of local and central resourcing as well as an appropriate ‘teaming’ model. In most cases Cambridge Online takes overall project management responsibility from the centre, coordinating resources and deploying implementation teams comprising a mixture of specialist and company resources. Striking the right balance is important for maintaining the integrity of the global product approach, effecting knowledge transfer and giving the customer the confidence to assume responsibility at project hand-over,” he adds.
“But there are also judgements to be made about the need to involve local management and locally based Microsoft Dynamics NAV partners who can support local language versions of the product or who can support specific vertical market functionality. It is this ability to combine flexibility and control that makes our model so compelling for multinational companies,” Ray Olds tells FSN.
However, there is no such thing as a ‘one-size-fits-all’ solution and just as multinational operations have floated down into the mid-market this sector has also developed a taste for outsourcing. The SSC model was popularised in the nineties by large multinationals using traditional ERP, but with many new outsource providers entering the market around the world it is becoming an attractive option for even companies of modest size.
But with so much volatility how does one ensure that changes are enduring?
“It is the post-implementation effort that can make a long term difference to the success of an ERP deployment. The ‘lifecycle’ roadmap does not finish with ‘live’ running. In fact many would say that it is just the start with companies seeking continuous improvement against the backcloth of constantly changing requirements. Policies need to be carefully crafted and controlled to ensure that changes are effected in a way that does not compromise ‘core’ group functionality, support and upgradeability. At the same time clear limits need to be defined around what can be changed locally. Furthermore, it is vital that adequately skilled resources (internal and external) are constantly abreast of new developments and the possibilities for leveraging the investment in the new systems,” Olds tells FSN.
By all accounts the mid-market has not been well served by re-sellers in this segment. But demand for multinational support in the mid-market is beginning to have an impact and the early signs are that vendors such as Cambridge Online, Sapphire Systems are responding to the challenge.