2021 Enterprise Resource Planning (ERP) Stats and Facts
Take a look at these ERP stats for 2021 to get a thorough understanding of the direction, challenges, and benefits that businesses are experiencing in modern enterprise resource planning implementations.
ERP systems are increasingly becoming a central aspect of business operations.
As an organization’s ability to leverage their data becomes the key differentiator between businesses, adopting systems that can unify operations across departments and provide a centralized repository for data from which to analyses can be made is crucial today.
This is where enterprise resource planning systems come in, and companies have been implementing these solutions in significant numbers over the last 10 (and particularly five) years.
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The purpose of this ERP stats and facts blog is to give an indication of what the market looks like, what business priorities are, and what kind of setups are being favored by organizations today.
- The global market for ERP was valued at $33.6 billion in 2017 and is expected to be worth $47.9 billion in 2023.
- Employees at distributions companies are most likely to actively use an ERP system (45% of employees), followed by e-Commerce (44%), and professional services (43%).
- Despite this, the manufacturing industry leads the way in ERP adoption (34% share), followed by IT organizations (15%), and professional and financial services (14%).
- Accounting was the most sought-after feature of an ERP system, with 57% of businesses requiring it in their system.
- ERP is the top tech investment priority among finance organizations, with 64% of firms planning implementations in the next three years.
- Businesses are increasingly replacing older systems, with 32% of respondents in a 2021 survey indicating their recent technology initiatives involved replacing legacy solutions.
- Satisfaction among employees in organizations where ERP has been implemented is largely positive, with a notable minority (1%) either being “dissatisfied” or “very dissatisfied” with their new systems. This dissatisfaction is far more common among companies that have failed to institute effective change management.
- 27% of companies put “very little or no focus on change management”, which is largely consistent with the number of businesses that express disappointment in their implementations.
- Of businesses that sought out change management services from a consultant like a managed service provider, only 33% found aspects of organizational change management difficult, compared to 67% overall.
- The most common change management activities for ERP implementation are customized training (73%), strategy (63%), and communication (57%).
- Digital business transformation as an objective is most common among SAP customers (58% of projects being business transformation), followed by Oracle (48%), and Microsoft Dynamics (44%).
- The majority of ERP solutions are based in the cloud, whether through the private cloud (46%) or the public cloud (12%), with a smaller amount on on-site servers (25%), and a minority on a hybrid cloud system (17%).
- Among the minority of companies that do not choose a cloud ERP, the three primary reasons for doing so are the risk of data loss (27%), risk of security breach (27%), and and lack of information about offerings.
- Just 1% of business acknowledge having no form of cloud infrastructure at all, with 48% having claimed to have completed their digitization projects.
- In terms of market share, Microsoft Dynamics 365 has a substantial advantage over its competitors, with 49% Following Dynamics 365 is Oracle (18%), Sage Intacct (17%), Infor (6%), and Epicor (6%).
- The biggest barrier to ERP adoption is employee resistance to change (82%), underlining the need for effective change management. Other barriers include inadequate backing (72%) and unrealistic expectations (65%).
- Technical aspects of ERP implementation were generally found to be the easiest to overcome, with just 8% of businesses finding the technical change of adoption difficult. By comparison, process changes (67% found difficult) and organizational change (75%) were bigger issues that had to be overcome during projects.
- An estimated 55%–75% of ERP projects fail to meet their objectives.
- 54% of ERP implementation projects today are on schedule, compared to 46% which run over schedule.
- The average budget for ERP per user is around $7,400 for a business with 500 employees over the course of a five-year period.
- This works out to around $123 per user, per month.
- 77% of organizations deployed their ERP system through the software-as-a-service model, compared to 23% using a hosted system.
- The average cost of a Dynamics 365 implementation is around $410K, compared to $1.9 million for Oracle.
- When asked in a survey how ERPs helped their operations the most, organizations were in most agreement that their ERP “allows co-creation of new applications using data and business logic from different departments.”
- For businesses that choose to partner with a managed service provider for their IT services, the most important attribute expected from an MSP was their ability to bring “innovative ideas of how to use IT to create business value through their ERP.”
- 37% of organizations customize between 26%–50% of the code in their ERP system, suggesting companies are opting for personalized solutions to a greater degree today.
- As far as organizational improvements are concerned, just 5% of businesses say that ERP did not improve their processes, with 49% stating they improved all business processes and 46% stating they improved their key processes.
- The principle reasons among businesses for implementing ERP were to increase efficiency (25% of businesses), support growth (20%), allow for greater functionality (20%), consolidate disparate systems (10%), and replace legacy software (9%).
- Operational efficiency is by far the clearest benefit of ERP implementation, with 97% reporting benefits to their operations thanks to their new system. This was followed by 86% stating better reporting and visibility and 68% noting increased growth and competitiveness.
- Business objectives for implementing ERP varied depending on the size of the company. Businesses with fewer than 50 employees valued supporting growth as the most important aspect of adoption (26%). For businesses with 50–249 employees, it was increasing efficiency (27%) while for businesses with more than 250 employees better functionality was the most important thing (22%).
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