The Erp Marketplace

The ERP Marketplace

Through this paper I will reflect on the different types of ERP systems that are available in the vendor marketplace. In addition to this I will also reflect on how I believe the ERP marketplace has evolved. Since I do not have any work experience with ERP, my reflections are based on the written literature concerning this topic.

According to Osintsev (2011) who wrote for the TEC – blog, there is an implicit understanding of what is meant by tier 1, 2 and 3 vendors. Then again, by reading Baiyere’s paper (2012) I found that he subdivides the ERP market into four tiers. Osintsev (2011) on the other hand do not think a fourth vendor applies to the ERP space.

There are several EPR vendors in the ERP market, but three major vendors (SAP, Oracle and MS Dynamics) dominate the ERP software sector (Baiyere, 2012). These three can all be viewed as 1 tiers organizations, and by looking at the diagram showed in Baiyere’s paper these three vendors had a huge part of the market share in 2009. And as far as I can see it looks like these three vendors still have a dominant position in the market in 2013 as well. SAP is still a dominant player, and has held the top spot in this segment for a long time. Moreover, it also seems like the competition from other vendors are increasing especially around the cloud- based service businesses (Trefis, 2013)

In the TEC – blog, Osintsev (2011) distinguish between the three tiers they present. First, they distinguish between the tiers by examining the type of company they serve: Tier 1 vendors serve large global businesses, tier 2 vendors serve mainly mid- market businesses and tier 3 serve smaller-than- medium- businesses. Furthermore, they also distinguish the three tiers by: software pricing, complexity of the software and ‘Business differences’ (Geographic presence and financial stability).

Nevertheless, in reality the lines between tiers are not that clear, due to the history and natural development of...