Financial software and enterprise resource planning (ERP) systems are experiencing a boost in popularity as organisations finally face up to the reality of replacing legacy systems. Indeed, according to several experts in the sector, investment in a range of areas in financial IT is rapidly increasing.
Expanding on the renaissance of sorts for ERP, Gerry Power, management consultant with Sysco, said that "ERP is suddenly back in vogue again". It’s a phenomenon that the industry "has been expecting for a few years" Power added, saying that there was "a bit of pent up demand due to the recession which held things up a bit".
He continued, "The last major ERP overhaul was in the late ‘90s. There’s generally a ten year cycle, and we’re back into it now where companies realise that technology has moved on rapidly-for instance in terms of mobile devices. That whole level of architecture of applications has evolved and people are demanding products to meet that need."
EXPECTING MORE
Exchequer Software Ireland commercial director, Alan Connor told ComputerScope that there are plenty of companies out there who’ve managed with older systems until recently, "but while they may have done okay in terms of processing orders before, clients are now expecting far more".
He continued, "Even if they don’t want to adopt every bell and whistle, they want the comfort of online portals, online procurement, an integrated accounting system and other functionalities." Connor said that integration of financial software has been a big theme recently, with existing clients looking to expand in terms of automation, warehousing, distribution and customer relationship management (CRM).
Charles Alken, business development manager at Pegasus Ireland agreed with Connor regarding the positive impact of integration on the financial software sector. The attitudes of the client, he added, have also changed. "For instance, when I speak to clients I’m seeing more flexibility in the workplace such as smaller companies being more open to having their accounts system in the cloud."
Alken noted that a more mature, educated client-base now know exactly what they want from their investment as well. "There’s a lot of mature functionality knocking around in systems and you can constantly add to it but that’s not always going to achieve results, you have to know what you’re doing and clients are waking up to that."
ENCOURAGING
Striking a similar chord, Simon Rabone, SAP service line leader for Ireland at IBM Global Business Services said the last 12 months have been encouraging, in that there’s been "a really big demand for both extensions of existing (ERP) systems and almost surprisingly brand new systems".
There are, he said, "quite a number" of legacy systems out there that have reached their end of life, "or, are not sufficient to meet a growth agenda". In fact, he added, IBM has been encouraged by how many companies are talking to them about "growth agendas", focusing on a pressing need to expand their workforce and IT infrastructure. Rabone commented that of the ERP options available on the market, systems from Microsoft, SAP and Oracle are finding the largest amount of fans.
ANALYTICS
Elsewhere, Gavin Doyle, inside sales manager for large enterprise at SAP UK and Ireland noted that the company has seen "a great deal of investment in analytics and business intelligence (BI) solutions to provide increased insight and understanding of their entire organisations".
Doyle made the point that the insight from analytics "isn’t just a ‘nice to have’ solution" for organisations but can instead make a noticeable impact on the performance of the business from "an efficiency and decision-making perspective". This, he added, results in cost savings in addition to improving customer service and quite often becoming more competitive in the marketplace.
Asked about the current ERP market, Erin McCann, commercial product manager with Sage Ireland, said that customers "are looking for an ERP solution which is integrated, affordable and designed to fit business needs-both now and for the future". "Flexible" and "scalable" are buzz words used by McCann as vital to ERP solutions, commenting that the ability to add "CRM, BI and other functionalities at any time in order to scale a solution as your needs change is key".
BUSINESS INTELLIGENCE
Asked what exactly those who are moving on and buying into new ERP options are after, Datapac’s head of business solutions, Richard Murphy said that greater BI and reporting capabilities that facilitate faster, smarter decision making "are a key component of high-quality ERP systems these days".
Pinpointing Microsoft Dynamics NAV as the most popular option in this space, he made the point that by combining SQL Server database and SQL Reporting Services with NAV, it’s possible for customers to "gain greater insight into their key business intelligence", which, he added, helps to improve efficiencies across the board.
"For customers looking at an ERP system, improved data exchange and collaboration, and the capability to integrate with other third party systems are essential," continued Murphy. "This is particularly true for large organisations with offices in disparate locations. Additionally, web services that make it easy to share data with other applications, while helping to maintain data integrity and security are extremely beneficial."
Sysco’s Power noted also that, "Microsoft is putting a lot of money into ERP and in turn it’s beefing up the interest level in the market."
GRANULAR LEVEL
Applications account manager with Oracle, Tony Murphy said that for larger organisations the past year has seen a burgeoning interest in high-level enterprise performance management solutions-a combination of performance management and BI.
"It’s about large companies who basically want to consolidate financial results from numerous entities within their group or organizations. They need everything now, be it information from financial systems to HR systems or risk management systems and more, so they can plan their budgeting and forecasting processes at a more granular level."
Expanding on his point, Murphy admitted there are also other drivers like "disclosure requirements and statutory requirements" that companies need to embrace, and which are promoting interest in up-to-date financial systems. "The big thing though, is that chief financial officers in the multinational organisations no longer rely on an annual budget to create resource allocation and investment decisions.
"The speed of change," he added, "means they must have much more dynamic ways of budgeting, planning and forecasting. You have to be able to forecast more regularly as the current circumstances can mean quick market changes at any time. As a result I suppose financial solutions are being deployed more and more to cope with this almost automatically."
WHERE TO NOW?
If business has picked up with regards to financial software and ERP in the past year, where does that leave the industry for the rest of 2012 and on into the next few years? After all, now that such solutions are "back in vogue", how exactly do they stay that way?
For managing director with Big Red Book, Marc O’Dwyer the next year can be summed up quite simply.
"Cloud, cloud, cloud and cloud," he said when asked about the shape of things to come. The company deals with a large cross section of Irish SMEs and he commented that this market in particular will embrace the cloud over the coming 12 months, as they look for new financial software solutions.
Continued O’Dwyer, "With no upfront charges and a pay-as-you-go model, this is an ideal way for small businesses to ensure they have and use a proper accounting or bookkeeping system from the get-go within their business".
24/7 ACCESS
O’Dwyer added that 24/7 access "for both the business owner and their accountant, in an extremely secure environment, always backed up and always running the very latest version" is a big selling point. "It is," he said, "a no brainer for any small business for the future."
SAP’s Doyle is of a similar mind, "Cloud computing will be a focus area specifically in public sector through the recently announced Public Sector Transformation programme, which highlights the shift towards cloud."
While Exchequer Software Ireland’s Connor would also note that "whether it’s a simple web portal or a true B2B business service where customers can see all their transaction history" cloud is the big theme of the year ahead.
Oracle-man Murphy added his name to the list of those focusing on the cloud, focusing on the fact that with most clients having gone through cost reduction programs, not to mention often drastic head-count reductions, in the past few years, they’re now-as the well worn saying goes-doing more with less.
"Which means, from an operational perspective, everyone’s talking about the cloud. It doesn’t matter which cloud they’re talking about, whether it’s public or private or whatever; what everyone is looking at is doing something in the cloud and the reduction in capital expenditure is key to that. Organisations want guaranteed service levels which is what the cloud offers. They want a predictable cost and probably better service levels and it frees up resources to do other things in business."
Datapac’s Murphy focused on the release of Microsoft Dynamics NAV 7.0 this autumn as a major leap forward that will keep development in the sector moving forward.
"It will add new cloud deployment options using Windows Azure," he noted, adding that the "RapidStart" feature will develop templates for individual verticals to reduce the number of professional services days required for implementation, thus simplifying deployments. "On top of this, extended application functionality will be enabled to give the user better access to relevant data and enable faster decision making."
MOBILE
Sage commercial product manager, McCann was slightly cautious on the movement of financial software and ERP to the cloud, saying that for many companies it may be a "slow transition". Despite this, the positives though are obvious to McCann and many others that ComputerScope spoke to. Improved business agility and collaboration capabilities as well as greater resource agility topped her reasons for welcoming the cloud into a company’s financial architecture.
"The burden of IT infrastructure decreases, resulting in less management, maintenance and deployment time, and the additional benefit of greater scalability to easily handle peaks in demand," she said-adding that managed costs and a smaller carbon footprint are other reasons to make the leap sooner rather than later.
McCann also echoed several others as she commented that the next year to 18 months will be an exciting time for marrying financial software and ERP to mobile technology. With organisations having little choice but to embrace the change as their workforce relies more heavily on mobility, McCann said that vendors are stepping up to the mark and developing innovative "mobile strategies for ERP solutions".
She continued, "There is a big push within the mobile BI space, where companies are looking at their traditional business analytics practice and using mobile technology to help build flexible dash-boarding as a first-use case for validating mobile technology within a company."
INCREASING PRODUCTIVITY
IBM’s Rabone would also comment that while there may not be many "major technology leaps" in the ERP and financial software market in the coming 18 months, what’s already here will be adopted in large numbers.
"Everyone knows about cloud obviously," he said, "and ERP will increasingly be available as a service on the cloud. But there’s also financial supply chain management and increasing productivity applications through mobile to watch out for as well."
New standards of financial software applications mean that mobile devices are now able to run processes "in seconds that were previously done in a number of hours". "That," he added, "is a fundamental change in terms of financial reporting and calculations that plenty of businesses will want to benefit from."
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