Enterprise resource planning (ERP) systems are software applications designed to help businesses manage their core processes. They can be used to track everything from inventory and sales to finances and human resources. ERP systems are becoming increasingly popular in Europe, as businesses of all sizes look for ways to improve efficiency and reduce costs.
ERP adoption in Europe
According to a 2023 report from Eurostat, 43.3% of enterprises in the EU used ERP software applications in 2023. This represents a significant increase from 2021, when the adoption rate was 37.9%. The report also found that the use of ERP software varied depending on the size of the enterprise. Large enterprises were much more likely to use ERP software than small enterprises; with adoption rates of 86.3% and 37.9% respectively.
A separate analysis by Monitor ERP identified similar trends, noting that over 43.3% of all EU enterprises used ERP systems. They also observed a marked disparity in adoption rates based on company size, with smaller enterprises being less likely to employ ERP systems.
Popular ERP systems in Europe
A wide variety of ERP systems are used in Europe, but some of the most popular include:
- SAP: SAP is a German multinational software corporation that makes enterprise software to manage business operations and customer relations. Its ERP system is one of the most widely used in the world, and it is particularly popular in the manufacturing, retail, and financial services industries. For insights on choosing reliable SAP consultants, read our blog post on key tips for choosing reliable and skilled SAP consultants.
- Oracle: Oracle is an American multinational computer technology corporation headquartered in Austin, Texas. It offers a wide range of cloud-based solutions, including a popular ERP solution. Oracle's ERP system is known for its scalability and flexibility, and it is used by businesses of all sizes.
- Microsoft Dynamics 365: Microsoft Dynamics 365 is a cloud-based suite of ERP and CRM applications designed for small, medium, and large businesses. It offers a wide range of modules, including finance, operations, sales, and marketing. Microsoft Dynamics 365 is known for its user-friendly interface and its integration with other Microsoft products. If you're considering implementing Dynamics 365, you can find skilled Dynamics 365 consultants through our services.
- Infor: Infor is an American multinational enterprise software company headquartered in New York City. The company provides business cloud software products for industries. Its industry-specific ERP systems are used by a variety of businesses, including those in the manufacturing, retail, and healthcare industries. Infor's ERP solutions are known for their focus on industry best practices.
- Epicor: Epicor is an American company that provides industry-specific enterprise resource planning (ERP) software designed for organizations in the manufacturing, distribution, retail, and services industries. Epicor's ERP solution is recognized for its strong manufacturing capabilities. You can find Epicor consultants with the right expertise for your project through Right People Group.
- Workday: Workday is an on‐demand financial management and human capital management software vendor. The provider's ERP system is particularly popular in the financial services and technology sectors.
This is a small sample of the extensive range of ERP options available in the European market. Many other providers cater to specific industries, business sizes, and functionalities. To gain a deeper understanding of the different types of ERP systems and the professionals you might need for your implementation, check out our comprehensive guide to types of ERP systems and the ERP professionals you need.
Factors contributing to ERP adoption in Europe
Several factors are contributing to the growing popularity of ERP systems in Europe. These include:
- Increasing need for automation: Businesses are looking for ways to automate their processes so they can reduce costs and improve efficiency. ERP systems can automate many tasks, such as order processing, inventory management, and financial reporting.
- Business scalability: Small and medium-sized enterprises (SMEs) are increasingly adopting ERP systems to help them scale their businesses. ERP systems can provide SMEs with the infrastructure they need to manage their growth.
- Demand for real-time data access: Businesses are demanding real-time access to data so they can make better decisions. ERP systems can provide real-time visibility into all aspects of a business, from sales and inventory to finances and customer relationships.
- Growing adoption of cloud-based ERP systems: Cloud-based ERP systems are becoming increasingly popular, as they offer a number of advantages over traditional on-premises systems. These advantages include lower costs, greater flexibility, and improved security.
- Advancements in cognitive technologies: The increasing adoption of cognitive technologies, such as blockchain, artificial intelligence (AI), and machine learning (ML), has further increased demand for ERP systems in Europe.
Factors hindering ERP adoption in Europe
Despite the demonstrable benefits of ERP systems, one of the main barriers to adoption is cost. Setting up ERP systems can be expensive, particularly for smaller businesses that are still establishing themselves. This is further compounded by the potential need to upgrade network infrastructure and implement stronger security software. For more information on the challenges of ERP implementation, you can read our blog post on ERP: Definition, benefits, and common challenges.
Beyond the financial hurdle, the effective implementation of an ERP system necessitates a well-structured strategy, competent personnel, and a proficient team. It is crucial to have effective planning and skilled individuals to install and use such systems. If you're looking for skilled individuals to support your ERP project, you can find ERP project managers through Right People Group.
Benefits of using ERP systems
ERP systems offer a number of benefits for businesses, including:
- Improved efficiency: ERP systems can automate many tasks, which can free up employees to focus on more strategic work.
- Reduced costs: By automating processes and improving efficiency, ERP systems can help businesses reduce costs.
- Better decision-making: ERP systems can provide businesses with real-time visibility into all aspects of their operations. This data can be used to make better decisions about everything from inventory management to marketing campaigns.
- Improved customer service: ERP systems can help businesses improve customer service by providing them with a 360-degree view of their customers. This information can be used to personalize interactions and provide better support.
- Increased competitiveness: By improving efficiency, reducing costs, and making better decisions, ERP systems can help European businesses become more competitive in the global marketplace.
The future of ERP in Europe
The European ERP market is expected to continue to grow in the coming years. Grand View Research predicts a strong compound annual growth rate of 9.1% through 2030, highlighting increasing adoption of cloud-based and mobile solutions.
Several trends are shaping the future of ERP in Europe. These include:
- The rise of cloud ERP: Cloud-based ERP systems will continue to gain popularity, as they offer a number of advantages over traditional on-premises systems.
- The growing importance of mobile ERP: Mobile ERP applications will become increasingly important, as businesses look for ways to give employees access to data from anywhere, at any time.
- Artificial intelligence in ERP systems: AI will be increasingly integrated into ERP systems, providing businesses with insights and automating tasks.
- The rise of industry-specific ERP solutions: ERP vendors will continue to develop industry-specific solutions that meet the unique needs of different sectors.
ERP systems are essential tools for businesses of all sizes in Europe. By automating processes, improving efficiency, and providing real-time visibility into operations, these applications can help businesses succeed in today's competitive marketplace. With the European ERP sector projected for continued growth, these systems are poised to play a crucial role in shaping the future of European business. If you're looking to implement or optimize your ERP system, consider partnering with a specialized IT consulting company like Right People Group.