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August 2019 WHAT TO LOOK FOR IN YOUR NEXT ERP CLOUD STRATEGIES AND OTHER DEPLOYMENT OPTIONS Spotlight on Looking for a new Enterprise Resource Planning (ERP) solution is not Plex Systems something you do every day. According to the Mint Jutras 2019 Enterprise In this report we highlight Solution Study, the average age of ERP implementations today is one of the few ERP approximately 7.75 years. If you’ve implemented a new solution within solutions that was born in the last five years, hopefully you are not looking again quite so soon. the cloud and is offered Therefore, it is safe to say that (unless you’ve recently changed jobs), exclusively as Software as anyone looking today hasn’t done so in the past eight to ten years, or a Service (SaaS). Plex even longer. A lot has changed, and it is very possible your current Systems was also born on solution has not kept up. the shop floor of a factory making axles, pinion gears Eight to ten years ago deployment options were hardly a consideration. and drive shafts. Its Most ERP solutions were still licensed and deployed on your own founders are the workers premises, or perhaps licensed and hosted by a reputable third party. A who kept the presses short decade ago ERP could easily have been called the last bastion of running and made sure resistance to Software as a Service (SaaS). “Cloud” had yet to become part parts matched customer of the business vernacular and “SaaS” was still a relatively new and poorly specs. Frustrated with understood concept. While other complementary solutions, particularly inaccurate inventory, Customer Relationship Management (CRM), were headed in that machine breakdowns and even making the wrong direction, entrusting the transactional system of record of your business parts, they built Plex to to the cloud required a higher level of trust that had not yet developed. make the plant run better. But now - how times have changed! Today the majority of businesses have The Plex Manufacturing some sort of cloud strategy and the shift to the cloud and SaaS has begun in Cloud now connects every earnest. Thirty-one percent (31%) of survey participants in the 2019 Mint manufacturing operation in the cloud. Jutras Enterprise Solution Study have a SaaS deployment of ERP, and for those that do not, 51% say they will move in this direction, some sooner, some later. If you are currently or soon to be selecting a new ERP, it should be a critical factor in your evaluation. You might think decisions about deployment could be deferred until after you have chosen a solution. But this must be considered up front because not all ERP solution providers offer the same (if any) choices of deployment options. In this report we highlight The Plex Manufacturing Cloud (offered by Plex Systems), one of the very few ERP solutions that was born in the cloud and is offered exclusively as a multi-tenant SaaS solution. DEFINING DEPLOYMENT OPTIONS Non-technical ERP enD users often don’t know, care or need to know which of these deployMent options are actually being used to deliver the application and they are even less likely to care how it is paid For. But For those What to Look For In Your Next ERP Page 2 of 13 Data Source responsible For the purchase and deployment decisions, it is of paramount In this report Mint Jutras importance to unDerstanD all the potentially conFusing options. references data collected In our last few annual enterprise solution stuDies (incluDing our most recent in from its 2019 Enterprise 2019), we have asked how the participant’s current solution is Deployed. We Solution Study. For years ofFer the Following options to choose From: this annual study has investigated perceptions, • Software as a ServiCe (SaaS): Software is delivered only as a service. It is goals, challenges and not delivered on a CD or other Media to be loaded on your own (or status of software used another party’s) computer to run a business, as well • Hosted and managed by your ERP vendor: Software is licensed by you, as the impact of these solutions on the but you pay your ERP vendor to Manage and Maintain (host) hardware enterprise. and software • Hosted by an independent 3rd party: Software is licensed by you, but This year the study you pay another party to Manage anD Maintain (host) hardware anD collected responses from software 464 participants, from companies of all sizes • Traditional licensed on-premise: You license the software and are from very small to very responsible for managing anD maintaining it on your own preMises large, representing a • Hybrid: Parts are licensed and Maintained on-preMise and parts (e.g. aDD- wide range of industries. on Modules) are SaaS Given our Focus on clouD strategies it is iMportant to point out that hosted solutions May reside on your premises or on servers owneD anD operateD by a third party. But today they are quite often hosted and accessed via the cloud (more on clouD versus SaaS later). However, the customer still has to apply bug Fixes, updates and upgrades, or pay a third party to Do so. Each year the Mix of deployMents becomes More diverse. Figure 1 shows the spread this year, with SaaS being the Most prevalent by a small Margin. With a sample of 464, this should not be construed to Mean that 31% of all ERP deployMents today are SaaS. This is just a random sample and relatively small considering the millions oF ERP implementations arounD the worlD. Think oF it as directionally relevant. Figure 1: How is your Current ERP deployed? 40% All Respondents 31% 29% 30% 23% 20% 11% 10% 6% 0% Software as a Hosted and Hosted and Traditional Hybrid: on- Service (SaaS) managed by your managed by an licensed on- premise and solution vendor independent 3rd premise cloud (SaaS or party hosted) Source: Mint Jutras 2019 Enterprise Solution Study © Copyright Mint Jutras R&A, Inc. mintjutras.coM What to Look For In Your Next ERP Page 3 of 13 Also, For this question in particular, we have to take into account the observation noted above about end users not necessarily knowing or caring how an ERP is deployed. There is deFinitely some residual confusion over these options. We constantly assess this potential For confusion by cross-reFerencing diFFerent questions in our survey. In aDDition to asking how a participant’s current systeM is deployed, we ask which solution is deployeD. It is not uncoMMon for a participant running a solution that is offered exclusively as SaaS to select the seconD option (hosted anD Managed by your ERP vendor). We Find this to be a comMon Misperception and therefore accepted the response, but we scrubbeD out aDDitional responses where SaaS was selecteD even though no SaaS option of the selected product was oFFereD by the vendor, or where on-preMise was selected even though the participating company was running a solution ofFered exclusively as SaaS. Web-enabled user Web-enabled user interFaces further cloud the issue (pun intended). Many interfaces cloud the issue non-technical users siMply don’t know whether their organizations have (pun intended). Many licenseD a specific version oF the proDuct (anD perhaps pay maintenance in non-technical users simply don’t know order to have access to updates) or if they subscribe to software as a service. whether their More on the DiFFerent ways you can pay For ERP later, but For now, we simply organizations have incluDe Figure 1 to show diversity of iMpleMentations today, and as an licensed a specific version inDication that the acceptance oF clouD anD SaaS has grown. of the product (and We also askeD those that were not alreaDy using a SaaS-based solution iF they perhaps pay maintenance in order to had speciFic plans to Move to SaaS (Figure 2). have access to updates) Figure 2: Do you have speCifiC plans to move your ERP to SaaS? or if they subscribe to All Respondents software as a service. 30% 25% 23% 24% 20% 17% 11% 10% 0% Yes, within Yes, within Yes, No Undecided 1 year 2 years Eventually Source: Mint Jutras 2019 Enterprise Solution Study Over halF (51%) say they will Move in this Direction, some sooner, some later. Another 24% are still unDeciDed, leaving only one in Four (25%) bucking the trend towards SaaS, and Frankly, we suspect that some of those saying no today will likely reconsiDer or move to clouD at some point in the future. With alMost every ERP soFtware venDor hopping on the clouD banDwagon today, and Many of the largest claiMing victory in the race to be the biggest and the best, we Fear Many business users are also hopping on that wagon without truly understanding the benefits. And without this kind of knowledge, © Copyright Mint Jutras R&A, Inc. mintjutras.coM What to Look For In Your Next ERP Page 4 of 13 choices are being Made without Full understanding and some of those beneFits are being leFt on the table. Many solutions that were once only available as traDitional, licenseD deployMents (on your own coMputer or a trusted service proviDer’s) now oFFer a choice. But some of these “clouD” choices are really hosted solutions, which contributes to the confusion. Other solutions that were born in the cloud May only be ofFered through SaaS. It is iMportant to unDerstanD the difference between cloud and SaaS, as well as the diFFerent “flavors” of SaaS (Multi- tenant and Multi-instance). CLOUD VERSUS SAAS Many use the terms “clouD” anD “SaaS” interchangeably, but there are some important difFerences.

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