Interest in Mid-Market ERP Systems Reported to Be Increasing

The mid-market is filled with innovative and vertical-focused Enterprise Resource Planning (ERP) solutions. Ed O’Brien, Director of Research at ARC Advisory Group, argues that an increasing number of industrial firms are interested in deploying mission-specific ERP systems at the plant level for such capabilities as manufacturing and supply chain management, while maintaining a central, corporate-level system for centralized functions, like financials, CRM, HCM, and other functions.  These solutions often target mid-tier firms with solutions that tend to be used at plants that require specialized and/or vertical functionality.

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Looking Closer at Mid-Market ERP Systems

Mid-market ERP systems are designed for, well, mid-size companies. While the term “mid-market” is loosely defined, Ali Jani, Chief Product Officer at Acumatica, refers to it as being smaller mid-market companies who are in the 20-500 employee range. Don’t let size fool you, they’re just as complex as the larger enterprises they compete with.

Many have manufacturing operations which must be optimized and integrated with their supply chain processes. Still others do business internationally, spanning multiple time zones, languages and foreign currencies. For these reasons and many others, mid-market businesses need sophisticated ERP systems just like their enterprise competitors. However, these organizations typically do not have the availability of in-house IT resources found in larger, established enterprises. What mid-market companies need is sophisticated ERP software, which is cost effective to acquire and operate.

Growing Interest in Mid-Market ERP

In today’s digital era, where technologies are only getting more intelligent and complex, the need for speed and high product quality is critically important in this age of Internet of Things (IoT), smart manufacturing, and Industry 4.0. Thanks to some of the new innovations made possible by digital transformation initiatives, ERP systems have been evolving to meet the need of extended ERP capabilities. O’Brien says,

“Opportunities made possible by industrial IoT have been before us for a number of years, and now there has been an increase in the need for extended ERP capabilities in mid-market manufacturing firms. And for many of these companies, SaaS, or a hybrid on-premise/SaaS model, may be a viable option.”

Technologies once considered staples in ERP software are no longer sufficient enough in the age of process management due to increased specialization in some industries and intense competition. As a result, solution providers have had to shift their focus and develop tools that meet the needs of organizations dealing with increasingly large data and process volumes.

According to O’Brien, an increasing number of industrial firms are interested in deploying mission-specific ERP systems at the plant level for such capabilities as manufacturing and supply chain management, while maintaining a central, corporate-level system for centralized functions, like financials, Customer Relationship Management (CRM), Human Capital Management (HCM), and other functions. These solutions often target mid-tier firms with solutions that tend to be used at plants that require specialized and/or vertical functionality.

Today, the “new wave of ERP” solutions designed for mid-market organizations are gaining traction from customers seeking improvements in their processes and solutions. O’Brien reports that we are at an inflection point in ERP product development, where smaller firms can take advantage of expanded functionality at a reasonable cost and level of effort thanks to advances in digital transformation.

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