As part of our enterprise platform services research, we reached out to 15 global IT service providers and some of their key enterprise clients to understand their views on the leading cloud ERP vendors: Microsoft Dynamics 365, Oracle ERP Cloud, and SAP S/4 HANA.
We then analyzed their input against five important parameters.
Who’s the winner? Oracle ERP Cloud.
Here’s a drill-down on our analysis of the five parameters.
Technology sophistication/product excellence
Microsoft and SAP are still struggling to migrate all the on-premise functionalities to their cloud offerings. In fact, many of the enterprises we spoke with consider Dynamics 365 and S/4 HANA simplified versions of their on-premise offering, but with some functionality gaps. On the other hand, Oracle has made significant headway in its migration and is stepping up to integrate emerging technology capabilities into its cloud offering. Microsoft and SAP also lack case study-based proof points that demonstrate the maturity of their solution.
Ease of implementation and integration
Although implementation completion time is consistent among the three vendors’ cloud offerings, there are significant variations among their ease of integration. Because of its Fusion middleware, Oracle ERP Cloud is considerably easier to integrate with on-premise systems and other third-party applications than the others. SAP ranks lowest on this parameter, mainly because of challenges associated with integrating other SAP cloud offerings, such as SuccessFactors, Ariba, Concur, and Hybris, with the core S/4 HANA and on-premise SAP products.
Here, Microsoft fares better than both Oracle and SAP. It has a friendlier licensing model wherein it bundles its cloud ERP offering with CRM and other Microsoft products. In comparison, SAP’s limited features and functionalities make mid-sized enterprises its largest buyer group. And Oracle’s hosting environment isn’t particularly flexible; it is pushing to keep the NetSuite and Oracle ERP Cloud workloads in-house on the Oracle platform.
Because of Oracle’s and SAP’s strong presence in the on-premise ERP market, there’s an abundance of talent with the knowledge to be upskilled to implement, integrate, and manage their cloud-based offerings. In fact, supply is larger than demand. But Microsoft is struggling here, with a ~20 percent demand-supply gap for trained developers and integration consultants.
Overall customer experience
Over the past few years, Oracle has been able to improve its end-user experience with software updates. Microsoft is trying to create a better customer experience with its integrated enterprise offering. Dynamics 365 engagements are no longer just standalone ERP or CRM engagements; instead, oriented around a transformational impact message, they also encompass Office 365, Azure cloud services, and the Power platform. SAP is creating a better customer experience by collaborating effectively with its clients on implementation and maintenance issues. But it still delivers an inconsistent user experience between its on-premise and cloud version. While all three vendors have made strides in delivering a better customer experience, Oracle rose to the top on this parameter.
Our analysis shows that Oracle ERP Cloud is the clear, present winner in the war among the top three vendors. Although Microsoft and SAP are catching up with Dynamics 365 and S/4 HANA, and are doing great in specific niches, it will take some time before they evolve their offerings and establish some credible proof points across different industries.
Watch this space for additional blogs on the kind of challenges enterprises are facing with cloud ERP adoption, and what they should do to tackle them.