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Users Hit 'Pause' on ERP Investments

Chris Kanaracus | Jan. 24, 2011
The number of companies planning to invest in their ERP systems will drop slightly this year, according to a Forrester Research Inc. report, even as IT spending overall is expected to rise.

FRAMINGHAM 24 JANUARY 2011 - The number of companies planning to invest in their ERP systems will drop slightly this year, according to a Forrester Research Inc. report, even as IT spending overall is expected to rise.

One quarter of roughly 900 companies surveyed by Forrester plan to upgrade, expand or implement an ERP system, down from 29% in a study last year, according to the report by analyst Paul Hamerman.

Overall, 72% are "in a holding pattern for 2011, with plans to stand pat or no specific plans to invest in ERP," Hamerman wrote.

Roughly half of ERP customers are running product releases that are two versions behind the current one, according to the report. But expiring support windows and related price increases will spur more upgrades over time.

Still, overall the ERP market has rebounded well from its "disastrous" 2009, according to Hamerman's report.

ERP vendors will continue to roll out new features and functionality, although many customers may not adopt them for some time. Those features include cloud-based deployment options, mobile applications and embedded business process modeling, Hamerman said.

One of the most significant ERP product launches, Oracle Corp.'s Fusion Applications, is expected to happen this quarter.

Perhaps with one eye on the economy, Oracle has set modest public expectations for user adoption of the long-delayed software, which is supposed to combine the best attributes of the company's various ERP lines into a next-generation suite.

Fusion Applications will be available in modules to be deployed either on-premises or in the cloud. Oracle said the modules can be rolled out at the customer's own pace.

Also this year, SAP AG is expected to release of a series of software-as-a-service applications that act as extensions of its on-premises ERP systems, as well as mobile software obtained from its acquisition of Sybase.

 

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