Single vendor vs best of breed ERP
There is no simple answer to this choice when looking at ERP systems
There are many ERP systems available to us. Sage, SAP, Epicor, Dynamics, and others work well and have may paying, satisfied users. These ERPs have comprehensive modules for finance, production, order processing, supply chain, and nearly any need we have. These are examples of single-vendor ERP and they dominate the marketplace. Single-vendor ERP systems do everything the majority of businesses require and perform well. Single-vendor ERP systems are easier to maintain as they have consistent architecture and user interfaces across all the modules. Support for single-vendor ERP systems is usually good as a single phone call can be switched to the right expert within the same vendor organization.
Best of breed
While a single-vendor ERP is consistently good from module to module, some users want better than good.
Distribution businesses might want a warehouse management system that offers features not available in ERP. Slotting, where the optimal shelf location for an immediate item put away is important to keep wasted inventory and picker movement to a minimum. Yard management, where the contents of trailers and containers in the yard around a warehouse are managed so that the optimal trailer is brought to the best dock at exactly the right time is important. Reverse logistics is critical to many businesses that need to provide customers with simple product returns while managing the returned products separately from new merchandise. Warehouse management systems that are best of breed provide similar features that might not be included in an ERP WMS module.
Third-party logistics providers desire supply chain management qualities they need to maintain their market positions. Visibility of shipments at every stage and transition point from any corner of the globe is critical to ensuring orders arrive exactly when needed by the 3L customer. Along the way, there can be multiple country customs to be cleared. These businesses must manage many modes of transportation economically and with certain hand-offs from one mode to another.
Businesses that sell through internet web stores look for superior sales order management designed for internet sales rather than traditional purchase order/sales order management provided by ERP. Whether the storefront is Magento or Woo or another system, orders and payments processed perfectly in that system must be passed to ERP perfectly for fulfillment and accounting.
Which is better?
This question must be answered individually for each business. Best of breed systems will provide needed qualities for a business. They will likely provide those qualities at a higher initial cost, and the cost of maintenance likely will be more. If there is sufficient value, the cost is worth it to many businesses.
Best of breed systems tend to be niche products that might not be required for many businesses. When the best of breed system is used, the business will have ERP for other functions, particularly finance and the best of breed software must be integrated with ERP which can be challenging and expensive but many businesses have accomplished this successfully.
Probably the first question we need to answer is: Do we need a best of breed system? If the answer is yes, we recognize that some ERP modules while good enough for other businesses is not good enough to meet our requirements. v
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