Published monthly, September 2003

 

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Buyer Preferences and Purchasing Drivers for Back-Office Applications


Midsize businesses (MSBs) are no longer limited in choice to enterprise application suite (EAS) solutions that require all-or-nothing implementations. Instead, they can take advantage of new vendor options that are more affordable and less risky. They can deploy a subset of modules, often bundled together, that either address a basic set of requirements or specific business challenges. EAS solutions encompass one, some, or all areas associated with enterprise resource planning (ERP), customer relationship management (CRM) and supply chain management (SCM)
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What do midmarket IT decision-makers want and need for EAS solutions today?

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MSBs purchasing back-office solutions are highly focused on customer retention and return-on-investment as the highest ranked business justification criteria, with expense control still top-of-mind.

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Having a complete solution packaged by the vendor that includes integrated best-of-breed CRM and SCM is their top preference.

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Price continues to rank as the most critically considered evaluation criteria by MSBs when purchasing back-office solutions, with vendor financial stability, integration with established in-house solutions, ease of maintenance and customization remaining important.

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When considering deployment criteria, MSBs ranked minimal disruption to internal operations and staff as highest; with technical support responsiveness ranked as the highest post-sales support evaluation criteria.

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Business intelligence, analytics and corporate performance management (CPM) have emerged as critically demanded features and functions of interest to MSBs. They want more than a unified system to manage their operations, they also want a solution that's intelligent enough to alert them to what they need to know to run their business better.

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MSBs lack the internal resources found at large enterprises, and as a result expect powerful solutions that are easy to tailor and manage. Therefore, insurmountable integration obstacles and the cost of after-market services continue to be obvious concerns.

In short, MSBs are seeking component-based EAS solutions that are more appropriately scaled to their needs, are more likely to be successfully deployed, and offer more-easily identifiable and measurable business value. And to continue to compete successfully, they will need much more comprehensive business management applications to enable them to streamline, automate and improve their critical business processes.

By 2005, EAS vendors that deliver deep, industry-leading processing functionality, either alone or in conjunction with tightly integrated partners, will achieve 50% more market penetration than those that do not.

References
Research Note
Fewer Vendors, More Flexible Products Await SMBs in 2003
Publication Date: December 6, 2002
Author: Robert Anderson

Market Analysis
North American SMBs Identify Enterprise Resource Planning Preferences
Publication Date: October 4, 2002
Author: Robert Anderson

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When selecting vendors to provide CRM applications, midsize businesses' top criteria include vendors' vision for their products, commitment to midsize business requirements, and vendor viability.

Source:
Customer Relationship Management for Midsize Business Initiatives (Executive Summary), Gartner, Inc., November 22, 2002
 

CRM Implementation Challenges
The largest challenges for midsize businesses come from the organizational aspects of creating and implementing CRM strategies. Among the challenges related to implementing CRM, midsize businesses find re-engineering of business process, integration of applications and processes, and coordination across departments to be the most challenging.

Source:
Customer Relationship Management for Midsize Business Initiatives (Executive Summary), Gartner, Inc., November 22, 2002



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