John C. Maxwell once said, “Life is a matter of choices, and every choice you make makes you.”
ERP systems for Canadian manufacturers are also full of choices, but the choice they make might be make-or-break for their business. Through this article, Canadian manufacturers will learn their options and how to find an ERP system that will “make” them.
For the sake of brevity, we plan to cover only the publishers that are well known (or growing faster than their peers) and financially stable (as that is a factor in selecting an ERP). We have also opted out some of the other famous publishers such as Deltek, IFS, or Financial Force as they are not as relevant for manufacturers. Here are the options for Canadian manufacturers:
- Technical Platform ERP Segment: SAP, Oracle, Microsoft
- Industry-specific, Vertical-focused ERP Segment: Infor, Epicor
- Light Functionality, Simpler, Easy-to-use ERP Segment: Acumatica, NetSuite, Sage
How are these market segments defined, and what are their tiers?
At a broader level, market segments are defined based on the size of the manufacturers. Depending upon their size, the complexity of the business processes would differ, and as a result, they would require varying levels of flexibility to accommodate their unique needs.
With some variations in their definitions, there are three market segments that ERP publishers commonly use:
- Enterprise Manufacturers (over $1B in revenue)
- Mid-market Manufacturers ($50M-$1B in revenue)
- Small-sized Manufacturers (under $50M in revenue)
Large-sized manufacturing ERP systems are inherently flexible technical platforms.
While most larger publishers such as SAP, Oracle, or Microsoft offer solutions for each of the above market segments, their market share primarily consists of enterprise manufacturers.
Their products are technical to provide the needed flexibility for much larger manufacturing organizations. As they have much deeper internal IT organizations, the larger manufacturers prefer customizable solutions with the ability to tailor to their unique processes on an ongoing basis.
If you are an enterprise manufacturer, you are likely to require global breadth that a lot of other ERP publishers might not be able to match. Therefore, your best choice would be either Oracle or SAP, with Microsoft being the third.
Mid-sized manufacturing ERP systems are self-contained business applications to provide manufacturing sub-vertical functionality out-of-the-box
Unlike enterprise manufacturers, mid-market manufacturers don’t have large IT budgets or resources. They prefer a solution that can work out-of-the-box without expensive customizations.
The technical platforms offered by enterprise publishers require their resellers to build industry-specific functionality, increasing risk and costs for mid-market manufacturers. The mid-market ERP publishers, on the other hand, such as Infor or Epicor, are likely to provide much better value for the mid-market manufacturers. They provide self-contained solutions and have industry-specific last-mile functionality built in for several manufacturing verticals such as Industrial Automation or Machinery.
While Sage focuses on the SMB market, their primary target market is the advanced accounting applications such as Sage 100 or 300 or construction-centric businesses. Sage X3 could be a potential solution for manufacturers. Still, it suffers from similar problems as SAP Business ByDesign or Microsoft D365, where the last-mile functionality needs to be built by resellers.
If you are a mid-market manufacturer, Infor CloudSuite Industrial (Syteline) or Epicor must be your first two choices (Sage X3 being the third) as they provide a much deeper and broader solution with higher ROI and lower TCO.
Small-sized manufacturing ERP systems are more straightforward and designed to be easier for first-time ERP users.
In contrast to mid-market, smaller manufacturers don’t have as much international presence. They might have a couple of sites in North America. They don’t require as much planning as their mid-market counterparts do. They are incredibly tight on budget as well as with IT skillset.
If you are a small-sized manufacturer, your best choice would be either Acumatica or Netsuite (with the third choice being Infor Visual). These products are designed with lighter functionality in mind without making them overwhelming while also not requiring expensive customizations. They also follow an à la carte approach where you add apps from third parties as you grow.
They are especially suited for manufacturers that may be transitioning from simpler accounting systems such as QuickBooks or Xero.
As you can see, even among the popular choices, there are tons of product options provided by several publishers.
To find the wise choice that will “make” you, the first step would be to understand the target market for each publisher and ERP product. This article is an attempt to help you with that step. Learn how your business can leverage training for a successful ERP implementation.
If your business is interested in implementing an ERP system, consider learning more about the CME Technology Assessment Program (TAP). This program covers up to 100% of eligible costs to a maximum of $25K to conduct a third-party technology assessment on your manufacturing business. Speak to a member of Mentor Works team or call us at 1-888-599-3111 for more information.
Author: Sam Gupta has been a thought leader in the digital transformation space for nearly two decades, with the primary focus on financial systems and ERP. He has been part of large transformation initiatives for fortune-500 corporations but now spends his time consulting with SMEs as a Principal Consultant at ElevatIQ. Sam regularly speaks at industry conferences and contributes his experiences through many popular blogs and publications. He is always open to chat about technology and digital transformation topics on LinkedIn or Twitter.