Will 2008 be the year of on-demand ERP? Certainly, there wil be a lot of talking about it, but I doubt if it will be a serious threat to ‘native’ traditional ERP players like SAP, Microsoft or Oracle. There are two international players for on-demand ERP who deserve some attention: Netsuite and Intacct.
This on-demand software company for accounting and ERP (like Salesforce.com is for CRM) has worldwide ambitions, which is why they launched an IPO in December 2007. They claim 5400 customers worldwide (they don’t tell how many of them are using the free trial), but my intuition says you can count the customers in Europe on one hand. And, booking $20.6 million in losses on a revenue of $76.8 million does not really impress me… but I may be and old-fashioned guy. It’s a pity their web site is not really up-to-date: in the ‘News’ section, the latest ‘Netsuite in the news’ dates back to November.
Intacct is still a privately held company and much smaller (only 2700 customers) than Netsuite, but I must say I was charmed by their web site: it looks dynamic, inviting, and the product overview is really clear… something Microsoft could take an example on: the way Microsoft Dynamics products are presented is not the most inviting I have ever seen.
Traditional ERP players shouldn’t be scared of those on-demand players in 2008 yet. There are lots of questions about consultancy, product localization, customization, product performance and technical support (the standard product license represents less than 30% of a total ERP implementation cost). But the trend towards more ‘on-demand’ is clear.