For IT chiefs like Pam Haney, IT director at Irvine Scientific, a $28 million life sciences company, issues of competitive advantage are overshadowed by ever-present customization needs with her ERP system. "What we're faced with is having to deal with ERP packages that are not designed for process manufacturers" like her company, says Haney, who also took the survey. In turn, she has had to make do with bigger packages that are "revamped" for Irvine Scientific's specific needs. The problem lies in the fact that while her company is small, "we have big company needs," Haney points out, such as operations in Ireland that introduce multicurrency issues. Given those currency and conversion issues, and the fact that her current ERP system can't reconcile all of the application changes (such as in the shipping and invoicing tools), the end result, she says, is that "we're doing a lot things manually or with customizations."

Innovation, Where Art Thou?

The giant ERP vendors, with their workhorse enterprise packages, are not exactly hothouses of innovation for small and midsize companies. (Read "Under Pressure, ERP Giants Struggle to Innovate.) The large vendors provide innovations but no longer can get to the micro-vertical solutions that customers expect," says Wang, referring to highly targeted, industry-specific applications. Yet while 38 percent of those surveyed pronounced themselves dissatisfied with the level of innovation delivered by their ERP supplier, nearly half declared themselves satisfied. Twelve percent weren't sure.

Doherty says there's a significant difference in what ERP innovation means to different CIOs. "I'm satisfied that they're being innovative with their products," she says, in reference to Oracle. "But they're not offering innovation for my business."

For example, "green buildings" are the next big thing in real estate. Doherty says that's an area where she would welcome ERP systems innovation. Her company's tenants as well as prospective ones are starting to ask for such buildings, which can improve energy efficiency and lower energy costs. To make such green initiatives viable, Doherty's company needs to integrate ERP systems such as billing with newer building information management systems that manage climate control systems. The payoff is happier tenants and more efficient and environmentally friendly buildings. But "how do we do that without it costing us a lot of money?" she asks. Given that the market for real estate applications is so small, she says that she can't imagine ERP partners wanting to do that.

Irvine Scientific's Haney also sounds pessimistic. "We're not getting innovation," she says. Although she's a member of QAD's customer advisory board, she says it has taken QAD too long (two years in some cases) to get new features into its products. Her gripes range from the slow rollout of newer initiatives, such as electronic signature features, to still missing functionalities from yesteryear, such as e-mail addresses in customer files. "This is 2008!" she says. "They are so far behind on being innovative." (Haney has since sent RFPs to several new ERP vendors.)