Customers call tune in strong market
IN A fiercely competitive software market where there are so many options to choose from, customers are calling the tune and suppliers are having to change their strategies to meet their demands.
Rob Bothma, industry specialist for HCM solutions at NGA Africa, says there is a growing resistance to purchasing software upfront when in reality the product never belongs to the customer. “Customers are asking why they should pay upfront when all they are getting is the right to use the software.”
He says this type of comment is increasingly common as more cloud solutions become available and it becomes easier to switch from one application to another.
“A similar thing happened to the mobile networks with number portability.”
Stephen Corrigan, MD of Palladium Software, says accounting and ERP software suppliers traditionally sold products on a one-size-fits-all basis and customers had to adapt their business processes to the limitations of the system. But customers expect the applications they buy now to adapt to their business processes.
This used to be a major task but nowadays most accounting and ERP systems are designed to be modified.
“With almost every sale we make involving more than 10 users, each customer has a different wish list,” he says.
Jane Thomson, MD of Softworx, says customers are getting smarter when they buy ERP software and they often expect the supplier to share the risks associated with the implementation. For example, if the implementation overruns or the system does not work properly the supplier must bear the cost of the time and support while sorting it out. “Some customers are even saying the supplier should take the system back if it does not work,” says Thomson.
She says sometimes customers do not always know what they want or do not define their requirements clearly.
Simon Carpenter, chief customer officer at SAP, says most organisations are concerned about the risks associated with the length of time it takes to implement an ERP system. “So suppliers need to make it quicker and easier to implement their software.”
He says the trend is moving to phased implementation, most commonly by taking a process such as procurement or human resources and creating a template and rolling it out across the business as a shared service. “We are also seeing a growing realisation that ERP is a business project and not an IT project.”
He says this view is most prevalent among customers who are on their second or third implementation of ERP.
Steven Cohen, MD of Sage Pastel, says user expectations are greater than ever before, especially among the younger generation. This puts pressure on accounting and ERP software suppliers to web enable their solutions and provide mobile access to certain data.
“Users are saying that they can get other applications on their cellphones, so why not their accounting and ERP information?”
However, with systems that were developed 20 years ago it is not easy to deliver this type of functionality. Similarly, it is not feasible to rewrite a traditional system and make it available in its entirety in the cloud.
“So suppliers are developing hybrid applications that enable relevant data to be shared between desktop systems and the cloud,” says Cohen.