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I BLOG ERP is my accounting of the advances, obstacles and evolution of the Enterprise Resource Planning (ERP) software industry. As an ERP software consultant and software practitioner who has made my livelihood in the ERP software industry for over 20 years, I follow the market and market players closely. Rather than just regurgitate other publicly available industry information, this web site looks deeper to provide additional perspective, insight, opinion, balance or sometimes the the story behind the story. Much of the less than public content I receive is from web site visitors I have never meant, but with whom I share common interests. If you have first hand knowledge, insight or a thoughtful opinion relevant to any blog post on this site, I'd be very appreciative of your input and perspective. Lets share the knowledge.


2007 ERP Software Industry Year End Review

2007 was not a particularly impressive year for the ERP software industry relative to recent years and compared to other business software industries. A lack of enterprise market competition is stifling innovation. The ERP enterprise software market continues to be dominated by only Oracle and SAP. While both of these software giants made a lot of announcements during the year, their actual delivery of new and innovate application software was largely absent.

The real news from Oracle in 2007 was its continued forward movement of Fusion. Oracle has seemingly recognized that without a concrete common technology foundation, the acquired Siebel, PeopleSoft and JD Edwards customers have no real investment nor stickiness to Oracle and will certainly consider SAP and other competitors such as Lawson or Infor at the point of their next upgrade or at the next technology refresh cycle. The not so real news from Oracle is its embracement of the software as a service (saas) movement. While Oracle provides great lip service to saas, including an announcement at the November OpenWorld conference that every application the company creates from 2008 on will be 'saas-ready', Oracle's subscription pricing model is largely unattractive and unaffordable to most high growth and middle market companies. It's also no secret that CEO Larry Ellison believes that the saas business model doesn't provide the type of financial return he's looking for. See the "Larry Ellison and SaaS Software" article at ERPblogger.com for Larry's comments about SaaS during a conference call.

SAP's innovation for 2007 was also limited to announcements and not deliveries. The two primary announcements which offer real customer value in the coming years include SAP's Business ByDesign software as a service ERP system and the planned acquisition of Business Objects. Both announcements show the potential to change the face of a software giant that hasn't shown much change in recent years.

The hot market this year was clearly hosted software. While salesforce.com has taken a commanding lead in the Customer Relationship Management software space, the hosted ERP space is just heating up. NetSuite finished 2007 with an impressive IPO and is now flush with cash to supplement its growth strategy with increased R&D expenditures as well as an acquisition strategy. Aplicor also made great strides during the year and remains the most formidable competitor to NetSuite. With only NetSuite, Aplicor and SAP's Business ByDesign offering impressive ERP hosted software solutions, the ERP on-demand market remains woefully behind the CRM on-demand market.

The rest of the years events are actually a noticeable absence of events. Infor, Lawson, QAD, Epicor and Microsoft didn't demonstrate any great innovation or product advancements. In fact, Microsoft's famed project to merge its four ERP accounting software solutions into a unified ERP system, code named Project Green, was officially terminated near the end of 2007. Epicor did achieve strong earnings growth, but showed no substantive innovation. Lawson, Infor and QAD plugged along, however, seemed absent of any company milestones or significant client successes.

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