A large number of Dutch businesses are using ERP solutions. Currently, more than two thirds of mid-sized and large Dutch businesses have an ERP system in place, according to a new study among 6,500 respondents. SAP is the market leader in the Netherlands, followed by Microsoft and Exact.
To manage their business, many companies use an ERP software package. This kind of software supports all processes in an organisation – it is a central point where all data including those from customers, products and suppliers come together. Often ERP solutions offer the ability to, within the landscape, build business-critical applications, so that the solution aligns with the organisation’s (data) needs.
New data from Computer Profile, based on interviews conducted with 6,500 managers and IT professionals active in the Dutch industry (only companies with> 50 employees) shows that in the Netherlands more than two thirds of mid- and large sized companies (67.5%) were using an ERP solution in 2015. The percentage is up 1.6% on 2012, but down 1.4% on 2014.
A comparison by industry reveals that the differences across sectors are considerable. ERP solutions have most deeply penetrated the Dutch manufacturing industry, where more than 90% of companies have an ERP package in use. In the wholesale and retail world and the construction industry, many companies are convinced of the added value of ERP software, with respectively 88.3% and 85.0% using the software solutions.
Some sectors make considerably less use of ERP, including education (35.4%), health care (41.6%) and the public sector (48.3%). The professional services sector scored below average with 66.9% of companies using an ERP package. However, the business advisory services sector is the fastest climber in the list – the sector has increased its ERP usage by as much as 9.2% since 2012.
The ERP landscape in the Netherlands has, in recent years, seen a significant shift. External data centres are clearly winning over local and remote locations in the choice of location where ERP software is housed. Increasingly, the ERP system is outsourced to an external application manager, so the proportion of organisations with a local ERP solution has decreased from 44% to 32% since 2013. Also remote hosting – a situation when the ERP solution is hosted from the head office or a sister establishment of the organisation – is receding, with a decline of almost 5% noted over the past four years.
Interestingly, the role of cloud computing seems to be very limited in the ERP landscape. Only 2.8% of ERP solutions are routed through the public cloud, and although this is 0.8% higher than in 2015, the percentage has hardly changed over the last four years. The analysts, however, point out that under the category of 'Hosted' – besides the data-centres of external service providers – a number of private cloud solutions are also included. Hosted ERP solutions have doubled their market share since 2013, from 15% to 31% in 2016.
According to the analysis, ERP location is predominantly related to firm size. For medium-sized companies (50 to 250 employees), approximately 66% still work with a locally installed ERP package. Multinational companies prefer to use a consolidated internal or external environment as a platform to run their ERP application, with 45% opting for 'Remote' and 44% for 'Hosted'.
Most used ERP solutions
Of the various ERP software vendors in the market, SAP is by far the largest provider. With a market share of 20.4%, SAP can, as in previous years, call itself the absolute market leader. More than half of the Dutch multinationals (53%) uses ERP solutions from SAP, while also in the government and public sector SAP is the most widely used ERP brand, at 11.6%. The second place goes to Microsoft’s ERP software (11.8%), the market leader when it comes to national enterprises (250-2500 employees) and medium sized businesses – in these segments Microsoft has a market share of 18.4% and 14.4% respectively.
The third place goes to Exact, a Dutch based ERP solutions company with more than 1,550 employees globally, with an overall market share of 8.6%. In all four segments – the public sector, multinationals, national enterprises and medium sized businesses – the company holds a top 5 spot in the list of top ERP providers. However, as it stands, “only” a small 3.8% of multinationals companies in the Netherlands are using ERP software from the Delft-based IT firm.
After Oracle (5.3%), which is used mainly by large multinational corporations and public institutions, it is particularly customised solutions which claim a large market share (4.8%). The rest of the market is fragmented, with more than twenty software vendors distributing the remainder of the pie, each focussing on certain segments of sectors and/or functionality.