IT & ERP Consulting: Industry Trends

IT/ERP/MRP consulting industry is currently under the transformation.  This process is usually happening and comes in parallel with new economic recovery and change in the business paradigm.  We’ll try to appeal to historical excurse and give some hints on the future trends.  In our case we work with such products as Microsoft Business Solutions Great Plains, CRM, Navision, Retail Management System (RMS) and cross integrations between them and non-Microsoft products: Oracle, Lotus Notes Domino, Unix & Java platforms: J2EE, EJB, Bea Weblogic, Websphere, etc.  Let’s look at the history and the current processes:

• Classical Business Consulting.  It was flourishing back in 1950^th and had two major schools or directions.  It was the time when large businesses were trying to deal with the dilemma of growth and efficiency of internal document workflow.  If you remember – in that time computers didn’t exist and everything was recorded on the paper.  Plus it was the need to probe and deploy psychological methods of coordinating headquarters personnel: sales, purchasing, finance and accounting departments to work in synch with one another under the condition of paper document workflow
• ERP System of 1960^th.  This was the time of mainframe and first ERP.  If you look at the ERP application, it has GL, AP, AR modules – these are classical and could be tracked back to the 19^th century.  When you automate Sales Order Processing or Purchase Order Processing – this would be something new and each ERP vendor would be doing it as its own invention.  ERP Systems implementation faced the challenge of user experience lack in those days – this is why we see large number of flourishing ERP consulting firms in late 1960^th and 1970^th.
• ERP with rich functionality 1980^th & 1990^th.  Looking back to 1980^th – the typical large and midsize corporation had relatively similar business processes in Sales, Purchasing, Inventory Control, Warehouse Management, Logistics, Shipping & Receiving, Manufacturing, Accounting and Finance departments.  When we talk about similarity – we are comparing it to the diversification of late 1990^th and 2000^th when a lot of new companies grew up and went public.  The market conditions of 1980^th and early 1990^th made it feasible to design the systems with rich functionality.  From the ERP side we would name: SAP, Oracle, PeopleSoft, JDEdwards.  These systems cost several hundred thousand dollars in software licenses and the implementation of the system requires comparable budget.
• Business Models Diversification 2000^th.  If you look at the dot-com boom of late 1990^th – you will see that these companies tried to invent their own way of business processes to automate serving their unique business offer to the potential clientele, usually related to the new opportunities of internet marketing & sales.  In the case of these new public (plus small & micro cap) rapidly growing companies – business processes were in the turbulent change and the deployment of the system with rich functionality (usually with long implementation cycle) would not be the option.
• Customization & Integration.  As the alternative – new large and midsize businesses have to deploy standard functionality ERP system (not rich functionality ERP) and consider it as a platform for customization, custom development, reporting and integration.  These standard functionality systems are the ERP applications of the middle market: Microsoft Great Plains, Navision, Axapta, Accpac, MAS90, etc.  In our opinion – future business paradigm makes it non feasible to purchase high-end ERP system for midsize and even large corporation.