Businesses that are growing fast and generating significant business are finding that using manual methods of reporting, tracking, and financial management is a problem. There is too much data, too many angles to look at, and too much falling through the cracks. One way they solve this problem is with an Enterprise Resource Planning, an ERP, software. ERP sales are soaring as companies need this type of automation. In fact, 1 out of every 10 dollars spent on software by companies is for ERP software, a 45.5-billion-dollar business.
A clear majority of companies use one ERP. It is all that is needed and centralizing everything on one system. However, some companies are so large and have different locations that require two or more ERP solutions. In this scenario, the corporate headquarters has an ERP solution that is the most prevalent throughout, but different locations will have their own ERPs as they are built for a more specific purpose and benefit from a specialty tailored solution. As each locations business model, workflow, and processes differ, a different ERP can be found to do better by their industry.
There are other benefits as well. Having multiple smaller ERPs is often cheaper than having one huge blanket ERP system. The one system will be far too costly to customize and maintain. Also, keeping the ERP on the cloud will make it far easier to manage and maintain based on the location.
In fact, in large companies from 2011, 48% reportedly considered a two-tiered ERP up from 32% the year before. As technology improves and expands, it seems likely that this is less of a trend and more of a permanent fixture in the ERP space. Time will tell, but the future looks promising for two-tiered ERP.