In the early 90s I did some work with a multi-national which had SAP at its home country, J.D. Edwards on AS/400 in major country subs, Platinum on LANs in smaller markets and spreadsheets in even smaller markets. Not ideal, but broadband and talent costs justified the tiered strategy. In the 2000s, with telecommunications better and a number of offshore firms helping with implementations in secondary markets (if you check ERP references of a TCS or a Wipro, you see a number of such rollout projects), some of those tiers got flattened.
In last couple of years, I have seen tiering reappear – in many cases at the initiative of some of the regional subs. They are tired of the corporate chargebacks of expensive amortization of software license, annual maintenance, private data centers and not-so-cheap-any-more offshore application management.
In its earnings call today, CEO Zach Nelson talked about how NetSuite is benefitting from such re-tiering.
Another trend in recent years is the emergence of the “micro-multinational” – small firms which are global almost from inception. They would prefer not to tier – but still like the SaaS model vendors like NetSuite offer. Pay more only as you grow.
(Read this and other articles @ Deal Architect)
[...] I came across an interesting announcement by an SaaS vendor NetSuite on two-tier ERP and an analyst’s observations on the same. The analyst mentioned that the industry is moving in cycles from multiple-ERP suites [...]