Demand Being Re-heated
Jakovljevic - April 19th,
As reported on March 5 in The Dallas Morning News/KRTBN -- E-commerce
may get all the attention, but information technology experts say the
demand for enterprise resource planning professionals is almost as hot.
Companies, cured of the Y2K bug, are investing billions of dollars on
ERP, which are software applications that are supposed to streamline and
improve business processes.
the Y2K wrap happened, large companies embarked on new ERP" projects,
said Barbara Gomolski, research director at the Minneapolis-based Gartner
Institute. "Our expectation is there will be renewed interest in ERP and
e-business." Ms. Gomolski said companies reduced spending on ERP in the
second half of 1999 because they had to focus on the year 2000 bug, which
affected computer systems that represented years as two digits. Now companies
are struggling to find qualified professionals to implement ERP systems.
The trouble is that so many qualified ERP pros already have been lured
into e-commerce projects, Ms. Gomolski said.
The shortage is an opportunity for non-technical professionals to enter
the high-tech world, said John L. Hall, senior vice president of Oracle
University, the training division of Oracle Corp. All the non-techies
need going in, he said, is an understanding of how businesses operate.
"We are seeing a significant increase in students that are coming from
functional roles in business and are now applying those skills to IT,"
Mr. Hall said.
the Dallas area, Plano-based Electronic Data Systems Inc. plans to hire
250 to 300 ERP professionals in the next nine months to keep up with the
growth, said Robb Rasmussen, managing director of digital value chain
at EDS' E.Solutions division. "This has been lucrative for a lot of people,"
he said. "I wish I was 23 [years old] making what they make." Ms. Gomolski
said, "most companies will be willing to teach you what you need to know
about software." "What they are more interested in is your business knowledge,
your project management skills."
Nielsen, an ERP consultant based in Cedar Hill, said people with detailed
knowledge of specific industries are valuable because they can design
computer systems to a fit corporation's specific needs. He has specialized
in the chemical industry. "The ERP area is best for me because I ... look
at the broad picture and understand where all the pieces of the puzzle
belong," he said. "You have to have as much business knowledge as you
have technical knowledge." Mr. Nielsen said his business has been thriving.
He is buying a Cedar Hill office building for his firm, Tools, Toys and
Technology, which he ran from home until recently. The downside is that
Mr. Nielsen must spend a lot of time on the road. "ERP doesn't happen
in your hometown," he said. "Most of the times your clients are all over
the United States, Canada, and Mexico."
Mr. Rasmussen said newer telecommuting technologies will make it easier
on ERP consultants and their families. "In the future, much more will
be done remotely," he said. "I am trying to move to a model where not
all consultants have to fly out and show up on site." Mr. Hall said ERP
can be a good stepping stone for people interested in e-business. The
two areas intersect when data from the "front office" (Internet sales
and transactions) is piped into the "back office" (internal departments
such as finance and procurement). "It comes naturally for most people,"
he said. ERP professionals are "easily transformed into strong e-business
ERP is perking up - a sigh of relief for vendors, customers, and consultants.
The fact remains that the majority of ERP vendors have been taken aback
during the last 18 months by a combined effect of the following major
factors: the Y2K-caused market slowdown, the Fortune 1000 market saturation,
a bad reputation for exorbitantly expensive and protracted implementations,
and the market's attention shift to e-commerce (B2B, B2C), supply chain
management (SCM), client relationship management (CRM), business intelligence
(BI), and other extended-ERP applications. We also believe that the majority
of vendors tackled those difficulties with appropriate, time-and-money-consuming
counteractions like developing more implementation-friendly and industry-tailored
products attractive to the untapped mid-market, expanding product functionality
to cover the above-mentioned hot trends, face-lifting or fundamentally
revamping the product architecture, to name but a few.
recent upbeat quarterly results from almost all major players except for
Baan and SSA demonstrate the market is on its way back. We expect sales
to return to full force by the end of the second quarter 2000.
ERP is alive and kicking. This does not however imply that both vendors
and their affiliate system integrators will not have to seriously put
their current business models under a magnifying glass. The 'gravy train'
days of multi-year implementations, with $2000 consultant's charges per
day without producing obvious results, are past.
are now in the driver's seat and should be aware of the fact that they
need a reliable back-office system in place in order to conduct their
e-commerce business or client relationship management. Therefore, we encourage
them to aggressively inform themselves about vendors' latest product offerings
and vigorously negotiate contract terms. Pay close attention to vendors'
extended ERP offerings and discern hype from reality. The 64,000-dollar
question is how functionality rich those new modules are, and how seamlessly
they have been integrated with the back-office. Alternatively, how feasible
would the integration with third-party products be? Vendors' corporate
viability remains a crucial factor in any selection process, and it seems
as though the most of major ERP players are going to be around for a significantly
long time to come.
piece of advice to consultants: be agile and wary! Make every effort to
maintain your skills according to market demands. A magic formula lies
in the balance of both business skills and basic technical understanding
of what happens "underneath the hood". Inform yourselves about the company
you wish to join. Are they a 'hire-and-fire' place or a company who continuously
invests in its people's skill sets and attempts to cross-train them before
laying them off in droves? Needless to say that informal networking skills
are needed in order to find the answer to this question.