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Traditional ERP systems are not suited for people-centric businesses. But that's where Unit4 ERP systems differ.
That was the message from Unit4 at its Experience4U (X4U) virtual conference for customers and partners this week where the vendor touted its line of ERP products, saying they have evolved in lock-step with manufacturing to support a services-centric business model. Unit4 also unveiled plans for Unit4 ERPx, a next-generation ERP platform, which evolved out of the current Unit4 ERP 7 platform for industry segments such as professional services and higher education.
Unit4 ERPx will not be released until March 2021, according to the company. Industry experts said announcing the platform a full six months before its release date was not ideal but also not surprising, as the market for next-gen ERP platforms continues to be competitive terrain.
Unit4, based in Sliedrecht, Netherlands, provides cloud-based ERP software for small to midmarket organizations. The company claims to have over 5,000 customers in 100 countries, mostly in Europe, although in the past few years their presence has expanded in North America, South America and Asia/Pacific regions.
People industries need different ERPs
Unit4 ERP illustrates the evolution of ERP from its traditional origins in manufacturing and products, said Mike Ettling, Unit4 CEO, in his X4U conference keynote.
"This is not a good match for a people-driven business," he said. "The services industry is a different game and requires a different ERP system."
The Unit4 ERPx is built on three pillars -- deep industry functionality, a better user experience and a cloud architecture. The pillars are intended to make the next-generation Unit4 ERP the right fit for targeted organizations in professional services, higher education, the public sector and the nonprofit sector, said Dmitri Krakovsky, Unit4 product evangelist.
"[Unit4 ERPx] comes out of a deep understanding of how these four industry segments work and codifies this knowledge in the functionality and industry models," Krakovsky said during a conference session. "There are out-of-the-box configurations that substantially reduce the costs of going live."
Unit4's strategy also includes deep localizations of the software, down to national and regional levels, and is designed for small to midsize organizations, according to Krakovsky.
"We're not trying to go for large organizations," he said. "We know the [midsize] market and will focus like a laser on it."
Unit4 ERPx is built on a cloud Microsoft Azure infrastructure, and it includes low-code extension tool kits that make it easier for customers or third-party partners to build customizations and extensions into the product. Functionality in the next-gen Unit4 ERP's initial release includes Financial Planning and Analysis (FP&A), ERP and HCM in an integrated architecture.
"ERPx functionality is based on the current Unit4 ERP 7 solution," Krakovsky said. "Current differences, while very substantial within the bowels of the platform, are not significant in terms of a functional footprint."
Moving to a modern, industry-specific ERP
One of the customers looking forward to the modern advantages of Unit4 ERP is the Surrey County Council in the U.K., which recently awarded Unit4 a £30 million contract to replace its SAP ERP system, according to reports.
The time was right to move to a Unit4 ERP platform, Leigh Whitehouse, executive director of resources for the Surrey County Council, said during the conference's keynote.
"We had a series of imperatives to move off of our existing ERP platform. It was technologically dated software running on aged hardware, increasing the risk that it would become unstable," Whitehouse said. "There's also a transformational imperative, as the organization is going through a huge program of change and wanted software that would support us in that journey."
The Surrey County Council ran a year-long procurement process, and Unit4 ERP came out on top across a series of domains in a broad field of competitors, he said.
People-centric ERP not new
Unit4 is not plowing any new ground with its message of a "people-centric ERP," but the vendor does it well, said Cindy Jutras, president of Mint Jutras R&A Inc., an enterprise computing research firm based in Windham, N.H.
"The focus is good and Unit4 knows these industries well," Jutras said. "The organization size focus on midmarket came as a bit of a surprise, as in the past they have targeted upper-mid to large companies. Although they haven't capped it before. In fact, they probably have mostly served the midmarket simply because of the industries they target, so this makes sense."
Unit4 ERPx checks all the right boxes from a technology perspective, and it's pioneering when compared to legacy ERP systems, but it is playing catch-up to some of its competitors, Jutras continued. It remains to be seen if announcing the update a full six months before the release date will be advantageous.
"If they don't announce something like this, they might be accused of falling behind," she said. "Some customers just won't want to wait six months, but, more likely, they will need a push to do anything anyway. There is some risk involved in preannouncing, but if they deliver on time, it can work out well. Although, I question how much preparation customers can really do until it's there."
The industry-specific focus of Unit4 ERP is part of a burgeoning trend that should help its customers, particularly those in higher education, deal with challenges brought on by the COVID-19 pandemic, said enterprise industry analyst Vinnie Mirchandani, founder of Deal Architect blog about enterprise technology trends.
"In every industry during the pandemic, we have seen vertical edge apps get adopted and implemented, and they have allowed companies to survive and even thrive -- apps which support telemedicine in healthcare, PPP [Paycheck Protection Program] loan processing in banking, digital home selling in real estate, online education in higher education," Mirchandani said. "Most ERP vendors have had a tough time selling their core functionality, but specialists like Teladoc, nCino and Shopify have done very well in contrast."
The decision to announce Unit4 ERPx six months in advance is not ideal, he said, but unsurprising in the tech world, and it should give customers some lead time to get ready for the upgrade.
"I don't personally like it, but it is common in enterprise tech," Mirchandani said. "Corporate budgets don't get approved overnight, and in the pandemic, long projects like ERP are being greenlighted even slower."
Unit4's approach should help it grow in new markets, said Ray Wang, founder and principal analyst at Constellation Research.
"This people- or human-centric approach is the future of ERP, and the [Unit4 ERPx] launch will help take Unit4 into North America," Wang said. "The platform is super solid and modern, and they've brought together a cadre of ERP veterans to build and service a world-class solution."