I remember a meeting with a systems integrator while at Gartner. He wanted to know who would be the “next SAP” they should build a practice around. So I showed him an ERP magic quadrant. I still remember his face as he looked up and went “Who the hell are all these guys? How do they survive?”
SIs, themselves in a hugely fragmented market (the largest outsourcer has about 7% market share), have been notoriously (and ironically) unwilling to align with niche ERP players. Everyone wanted to build an SAP, Oracle, PeopleSoft practice back then. The reality is many could have done better with targeted practices around niche ERP players. And in spite of talk of how the industry has consolidated, plenty have survived and done their own acquisitions.
This week, I had encounters with 3 vendors who have survived and thrived with their differentiated focus.
Infor announced this week it has acquired the marketing vendor, Orbis. But in core ERP, it has done well with verticalization that include Lawson’s healthcare and government, Intentia Fashion, Baan Manufacturing and other offerings.
In Boston, I met with Unit4 and SYSPRO. While the obligatory messaging was around SMAC (the Cognizant term for Social, Mobile, Analytics and Cloud) , I was struck more by the fact that UNIT4 has functionality for research organizations (it combines that with the higher-ed vertical). There are countless such NGOs and academic organizations which need tight fund and project accounting and management capabilities. Its Coda unit with core financials continues to be attractive as the pendulum swings back from fully integrated ERP offerings. Its European presence continues to be a major asset.
SYSPRO similarly does well in food and beverage, medical devices and a few other verticals where they have unique features like traceability. With its S. African roots, it does well on that continent. Finally, they have done well to focus on small and mid sized customers, with a vibrant reseller model.
SYSPRO tells me they have a $ 300 m annual “footprint” around their $ 70 m in revenues. That’s what their ecosystem of resellers makes.
Maybe some SIs should be paying attention to them and UNIT4 and Infor instead of just asking “who the hell are these guys?”
