Evaluating ERP Vendors

Can anyone tell me your view on the benefit of going with a tier-two ERP vendor rather than the usual tier-one suspects?

-CTO, insurance company

A: Any ERP package you choose is going to do accounts payable, accounts receivable and all of the other basic business processes. I am at a midsize company that considered going with a tier one, but in the end we went with a tier two for a variety of reasons.

First, on implementation and maintenance, our tier two is a fraction of the cost of the tier ones we considered. Second, while the tier ones are customizable for specific industries, that customization is expensive. With ERP, you always have to do some business-processes reengineering software modification, and out of the box, our tier-two package fit reasonably well with our business. Finally, we got the feeling that the tier ones didn’t value our midmarket business to the same degree as the tier twos. We like the support we get from them.

The big question with a tier two, of course, is how long they can compete with the tier ones. You need them to stick around. But in the end, it doesn’t matter which ERP package you go with if you don’t let the business lead the reengineering effort. The success or failure of ERP rides on the implementation, not on the software.

-Steve Holt, CIO, Accuride