Jeremy Waterman, Sage ERPJeremy Waterman, Sage ERP

According to Gartner, public cloud services globally are expected to reach $131 billion in revenue in 2013, up from $111 billion in 2012. Software-as-a-Service (SaaS) offerings are expected to account for 14,7% of the estimated $131 billion cloud service revenues in 2013. This translates to approximately $20 billion in cloud application sales in 2013, and presents a huge opportunity for on-premise software developers.

Locally, however, the adoption of cloud and mobile technologies in the enterprise resource planning (ERP) space is sluggish. According to , sales and marketing director for New Era Solutions, cloud ERP is still a few years off becoming a reality within mid-market and larger corporate SA. “Platform as a service (PaaS) is definitely a reality, but not true cloud,” he explains.


He continues, “This leads, of course, to enterprise mobility and today it is commonplace to have corporate e-mail on smart devices. The next trend is to mobilise ERP. It could be as straight forward as approving purchase requests, reviewing and placing sales orders, working on updateable dashboards, for example, and this trend will gain huge traction in the course of the next few months and years.”

“The pace at which business changes and operates has changed and we are seeing a trend where even traditional office-bound workers, like financial staff, are needing to interact with the ERP using mobile technology,” he says.

Stuart Scanlon, New Era SolutionsStuart Scanlon, New Era Solutions

According to , HansaWorld sales and channel manager: Africa, with regards to mobility, our local market has been a little slow on the uptake compared to the rest of the world. “This is largely due to concerns as well as limiting infrastructure; but as mobile data and WiFi hotspots slowly become more affordable and more accessible, people are realising the value of having their business software available on a mobile device, accessible from anywhere; it gives many more advantages than risks.”

If you hear that your competitor is able to check his stock, generate and process a sale and even have it signed off right then and there by the customer from his tablet, she says, you realise that you also need to be able to offer this level service, or risk looking inefficient and behind the times.

With regards to enterprise mobility, says , MD of Softworx, smart devices continue to evolve and demands on the functionality of those devices has increased, the idea of extending mobility to core business systems, such as ERP, has also grown.

“Businesses have gained a better understanding of the mobile phenomenon and they have begun to tackle the next level of mobile granularity — business applications. As such, mainly large companies have now put in place, or are in the process of putting in place, an enterprise mobility strategy; however my opinion is that few are fully executing on them yet,” she says.

, MD of Sage ERP Africa and Middle East, believes ERP is regarded as a ‘mission-critical investment’ for Chief Information Officers (CIOs), although the benefits of having integrated solutions to manage business processes are becoming apparent in most departments of the company. “From product planning, development, manufacturing processes, sales and marketing and more, ERP is no longer considered a luxury, but rather a requirement. Consumers are mobile, staff are mobile and logic dictates that in order to keep up, business management will also need to become accessible on the go,” he says.
He points to a recent survey conducted by CDW Research assessing the impact mobile devices are having on business, which found respondents from 752 companies almost unanimously (94%) said they believe their mobile devices make them more efficient. What’s more, he continues, 89% of business employees use personal mobile devices for work and over two-thirds (67%) said their companies would lose competitive ground without those devices.
The need for enhanced mobile capabilities is also recognised in backend operations, says Waterman. “According to the ‘ERP Trend Report 2013’, conducted by Softselect, some 88% of CIOs admitted to preferring an integrated IT system rather than using a ‘best-of-breed’ approach that uses multiple tailored solutions. A study conducted by based on a survey of 455 IT leaders across the world found ten percent t of the average IT budget is already spent on mobile ERP and over half of respondents said their organisation has a plan for mobile ERP.


Cloud technology is not a revolution; it’s an evolution that materialises the maturity of the Internet, according to Waterman. “Customer expectations change and the cloud can be an extraordinary accelerator of customer satisfaction, as well as moving IT from IT from a transactional to an interaction-based business. However as customers and suppliers, it has already taken us almost 20 years to get to where we are today with the Internet and it will take even longer before everything runs from the cloud.”

Because cloud is more flexible and Web-based, we can expect that the cloud will provide much easier access to an ERP system. “Although the cloud will not dominate for some time in the ERP space, it will profoundly change mindsets and drive software vendors in a new direction. Building hybrid systems and leveraging the best of the on-premise and cloud worlds will help the transition, drive adoption, and create true value for our customers,” says Waterman.

Thomson sees the adoption of public cloud ERP is increasing in the medium and smaller companies. “However, very large companies still prefer to use a straight on-premise or private cloud,” she says.

With the major vendors now all adopting and accepting SaaS based pricing, customers have the options to have a purely OPEX model for their ERP investments where they sign a multi-period deal for the access to the hardware, the software and the annual maintenance. “This makes it much easier for smaller cash strapped companies to be able to afford an ERP investment,” she says.


Waterman points out there is a global trend for ERP vendors to offer more lightweight, flexible ERP systems that are more accessible to smaller companies. “This, together with the more flexible payment options, will ensure a greater adoption of ERP by SMEs,” he says.

Scanlon highlights a trend in smaller ERP solutions being made available in the cloud. “So smaller organisations tend to steadily move toward a complete ERP offering using a building block approach, starting with core financials, inventory and sales orders. Once these organisations see the value in an integrated ERP system gained through access to data and control over that data,  they start to extend functionality, automate processes, and so on.”

Thomson has observed a significant degree of interest from African countries in the cloud and SaaS-based model. “The absence of a need for capital investment is one factor, but often the drivers for such decisions are vested in the absence of sufficient skilled and experienced IT staff to operate the systems themselves. Or the fear of the risk of being locked into and at the mercy of scarce skills – customer prefer to work with a reputable IT company who can provide their existing staff with a career and development,” she says. “They then start their journey to cloud by an initial outsourcing of people, systems and hardware, and then when the technology needs a refresh, they then move into a full cloud model.”

When it comes to smaller companies, Cromie believes scalable ERP solutions with more competitive pricing will grow in this market. “Options like renting the software instead of an outright purchase as well as ‘pay per use’ will become more popular and readily available. There are more affordable and better-suited ERP packages for the SME market; customers should research more rather than simply going for the names they know,” she advises.


An increased demand for interaction and collaboration between application suites for business streamlining in ERP is presenting its share of challenges. According to Cromie, ‘mixing and matching’ of systems are often the result and although this may have its advantages in the short term, very often these systems become unstable and very difficult to maintain. “I feel it is always better to try and find a system that matches as many of your needs, in one, integrated system, and if that system is customisable, then it may be worthwhile to add on and develop within the system rather than patching in another application,” she advises. According to Scanlon, this has definitely forced ERP companies to relook at how their customers need to interact with their ERP systems. “Some are taking the more traditional and safe approach by partnering with point technology offerings that enable this. Others are looking inward at their systems and architecture as an expensive investment in the future. Those providers that are doing nothing, will most certainly struggle to compete as the technology landscape will continually evolve at an ever increasing pace,” he says.

Waterman believes the adoption of hybrid cloud solutions enables companies to quickly and easily extend their ERP solutions to include customer relationship management (CRM) and human capital (HCM) management solutions.

“In this context, we are seeing the development of social business applications,” Thomson explains. She refer to the example of Infor Ming.le, which a comprehensive platform for social collaboration, business process improvement and contextual analytics. “It is embedded within key systems like ERP, supply chain management (SCM), HCM, and enterprise asset management (EAM). It enables employees across all areas of the business to communicate and collaborate, and easily follow people, assets, and processes relevant to the task at hand. Information such as documents, plans, photos, and videos are maintained in a centralised location with relevant activity captured to allow easy access by those who need it,” she says.


When it comes to the future of the ERP market in SA, the outlook is generally positive.

Cromie believes the move to mobility will continue in future as will having full access to business processes via one’s tablet and smartphone.

Jane Thomson, SoftworxJane Thomson, Softworx

“And the trend of changing to a monthly fee model, rather than making outright purchases will also continue,” she states. She also envisions the expansion of ERP technology into rural and previously undeveloped areas as a direction the market is moving towards.

According to Thomson, given the economic climate that prevails locally, the appetite for replacement of ERP systems in companies that already have existing such systems is low, and the focus should be on upgrading instead.
“Furthermore, the adoption rate amongst smaller companies who are now able to afford ERP is significantly increasing,” she says. “So the growth rate is not huge but it is steady and the advantage for the smaller customer is that once they have their base ERP system in place, they can then gain access to all the other associated and integrated business applications in the portfolio which improves the efficiency and effectiveness of their businesses,” she explains.

“We know that increased is forcing every business to be unique and different, and to maximise its ERP investment, a business must reinvent its ERP solution to support strategic enterprise initiatives,” according to Waterman. “The growing complexity of every business is driving business applications to provide more comprehensive and complete capabilities. So this means ERP business tools and solutions must evolve to address these changing business requirements.”

Waterman points out there are four key trends that are making a large impact on current ERP technologies: social, mobile, cloud and information management. “These four trends are influencing the need to drive ERP toward user centricity and away from traditional monolithic ERP architectures,” he says.

Scanlon believes SA is no longer in the shadows and competes in an International market. “The fact that SA is not a typical BRIC country and cannot compete with cheap labour or minimal Government intervention, forces business to control operational expenses and efficiencies more so than other emerging countries. When companies are small, it is possible to manage costs by being hands on, but as the business grows. Systems and processes are required to enable these business to manage the exceptions, as opposed to managing the detail. This places ERP in a strong position as SA is a more mature emerging market, requiring mature thinking,” he says.