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7 Questions to Help You Choose: NetSuite vs. SAP ERP

Originally, ERPs were used by large manufacturers, however right now data-driven business processes have popularized the adoption of ERPs in SMEs. The benefits are endless. How how do you choose between NetSuite and SAP? This article is here to help.

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Irina
datepicker icon September 13, 2022

NetSuite vs. SAP ERP. Which one to choose? ERP is the common database that helps to visualize and analyze all company processes. The best part is – the business can set it up for the needs of different departments. Depending on the needs, any employee from CEO to administrative staff can make use of it.

1. What is an ERP?

Enterprise Resource Planning or ERP is the common system that manages all business processes. The system helps to collect all data produced by different departments, interpret it and plan ahead. It is the place where users can view all business operations as a “one whole” thanks to integrating various business applications. The ERP system collects all processes and data in real-time and is constantly updating to take into account all processes. Moreover, thanks to modern technology present-day ERPs include machine-learning algorithms enabling the users to plan ahead and get the sophisticated analysis of business operations.

ERP usually has different modules for accounting, human resources, production, supply chain management, CRM (including marketing, sales, and account management). Each department can have its own adapted interface, however, each of them is using the common database and has the same “look and feel”. This way an ERP is helping to transform your business into an intelligent enterprise, regardless of how many employees you have.

2. Who ERP is for?

In the mid-1990s the manufacturing companies used ERP to plan their production. However, later their applications became widely adopted by other companies for their ability to have a larger view of the smaller processes within each department.

Nowadays ERP systems are applicable in various industries.  Manufacturing is still the biggest customer of ERP systems with 33% of the market share, followed by the IT sector (15%), the financial sector (14%), and many more industries including healthcare, education, and non-profit organizations.

Furthermore, the market size for the ERP systems is projected to exceed $49.5 Billion by 2025. The growing demand for ERP software is explained by the increased demand for business intelligence and wider adoption by small and medium-sized businesses.

The good part is that major ERP providers now offer a cloud-based solution. This means that businesses now access the shared cloud data centres from any location, which is more secure and cost-efficient. 

3. Why does Your Business Need an ERP?

ERP creates transparency between all your business processes and helps to understand how to use all resources of your business efficiently. ERP is the single system that allows viewing all business processes in one place. Imagine a large organization with different departments that are using their own computer systems to manage their work.

Think of the financing department, purchasing and inventory management, sales, and many other departments that have their own optimized computer interface that supports their day-to-day activities. An ERP is a system is based on all databases run by a business but still can provide each department with a tailored interface.

4. What are the Challenges of ERP Implementation?

An ERP system is not a magic stick that will solve all your organization’s problems and miraculously increase efficiency. There is a case when the incompetent ERP integrations have led to disruption in production. A recent famous case is the Revlon implementation failure.  Moreover, research indicates that around 50% of ERP implementations fail the first time.

The challenges that may lead to the unsuccessful result are the poor quality of business-produced data, poor project management, lack of skilful staff for the ERP implementation. The successful implementation of an ERM system is not under the IT responsibility, but dependent on the readiness of all business units for the new business strategy

5. What are the Benefits of an ERP?

Nonetheless, an ERP system is a tool that will help you achieve greater efficiency and transparency. 77% of small and medium-sized businesses reported the standardization of the back-office operations and saving costs (11%). Moreover, small businesses admitted they have saved time, and almost half reported increasing their data insights into the business processes.

However, it will require some preparatory work to get there. Frequently businesses are hiring ERP implementation consultants.

In the beginning, you have to analyze the technical requirements and the architecture required for an ERP implementation. Then you have to form a team that will lead the ERP deployment, also the contribution from all business units will be required. After the ERP implementation success, it will require constant optimization and monitoring.

6. Oracle NetSuite or SAP?

The market leaders in ERP systems are considered NetSuite and SAP. Both are fully customizable, have machine learning capabilities, have a mobile version, and offer regular updates. The pricing is very individual and is tailored to each company’s requirements and size. However, expect to pay a monthly subscription fee that usually varies on the number of users, maintenance fees, extra salaries, and one-off implementation costs. Below are several points that might help you to decide which ERP system is better for your organization.

NetSuite

In 1998 Oracle’s top executives have founded NetSuite with their own seed money. However, in 2016 the Oracle Corporation has acquired  NetSuite. NetSuite ERP is available exclusively online and offers Software-as-a-Service solutions. More than 27,000 companies around the globe are using NetSuite ERP.

NetSuite is a better solution for the retail and e-commerce businesses, financial services, advertising and media, transportations, and logistics, but also good for manufacturing. The ERP by NetSuite is generally better for smaller, growing to larger corporations.

SAP ERP

SAP ERP was developed by the German multinational software company that was founded in 1972. The ERP went live in 1992. Historically, it was software that was running in the in-house business’s data centres. However, in 2007 the Cloud version became available too (SAP Business One). With a cloud solution, it is easier for users to access the software from anywhere in the world with their login details.

SAP is best for manufacturing, after all, historically this was the main target industry. Also, it is better fitted for the wholesale distribution, professional services of SaaS companies. Additionally, is more preferred for large enterprises.

7. How to Enhance the ERP Capabilities?

No matter which ERP system your organization is using, both NetSuite and SAP have a great interface for Account Payable and Accounts Receivable. Why not integrate the Kolleno Collections software extension and automate your AR. We specialize in communication with clients using AI technology, via several different communications channels using the perfect timing and most appropriate tone-of-voice. Through open-API we can integrate with your existing solutions and help to improve your cash flow.

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Irina